Bagged Salad and Salad Dressings - US - July 2008

Table of Contents

• Scope and Themes
• What you need to know
• Definition
• Data sources
• Sales data
• Consumer survey data
• Abbreviations and terms
• Executive Summary
• Market at a glance
• Packaged salad and greens drive growth
• Packaged salads and Fresh Express are growing together...
• ...while salad dressings and Kraft decline
• Innovation has been slow but it is coming
• Cooking at home is rising--packaged salads need to broaden appeal
• Grocery is main channel but mass and natural sales are rising
• Who' s using packaged salads?
• And how are they using packaged salads and dressings?
• Health and safety concerns resonate with black and Hispanic consumers
• Market Size and Forecast
• Overall growth is moderately strong and likely to continue
• Even fast food restaurants have gotten salads
• E-coli and Salmonella scares hurt market
• Premium pricing will lose some consumers
  • Figure 1: Total U.S. sales of packaged salads, salad dressings and toppers, in current prices, 2002-12
  • Figure 2: Total U.S. sales of packaged salad and salad dressings, in inflation-adjusted prices, 2002-12
• Wal-Mart sales
• Competitive Context
• Key points
• Food safety is critical
• Interest in cooking at home is on the rise
• Cross-merchandise with salad kits and/or other prepared proteins and carbohydrates to compete with QSRs and prepared meals
• Packaging is another important element of the competitive landscape
• What can the industry do?
• Overall Segment Performance
• Key points
• Packaged greens drive growth as dressings drag down category performance
  • Figure 3: Total retail sales of packaged salads, dressings and salad toppers, segmented by type, 2005 and 2007
• Salad dressing drags down overall category sales
• Toppers can drive category innovation
• Segment Performance -- Packaged Salads
• Key points
• Packaged lettuce and greens drive overall category growth
• Consumers and restaurants are persuaded to embrace healthier foods
• Flat incomes and safety concerns hurt sales
  • Figure 4: Total sales of packaged salads, at current prices, 2002-12
  • Figure 5: Total sales of packaged salads, at inflation-adjusted, 2002-12
• Segment Performance -- Salad Dressings and Toppers
• Key points
• Salad dressing sales are slowly declining
• Not health-enhancing...
• Rise in the incidence of cooking at home
• Price may not justify benefits, especially given an increase in healthy eating and home cooking
  • Figure 6: Total sales of salad dressings, at current prices, 2002-12
  • Figure 7: Total sales of salad dressings, at inflation-adjusted prices, 2002-12
• Salad toppers sales are growing
  • Figure 8: Total sales of salad toppings, at current prices, 2002-12
  • Figure 9: Total sales of salad toppings, at current prices, 2002-12
• Retail Channels
• Key points
• Food stores are the primary channel but are losing share to mass merchandisers
  • Figure 10: Retail sales of packaged salads, dressings and toppers, 2005 and 2007
• Natural channel/SPINS
  • Figure 11: Natural product supermarket retail sales of packaged salad and salad dressings, at current and inflation-adjusted prices, 52 weeks ending June 14, 2008
• Sales of both packaged salads and dressings both rose in the natural channel
  • Figure 12: Natural product supermarket retail sales of packaged salad and salad dressings, by segment, 2006-08
• Natural supermarket channel sales of packaged salads rose in 2008
  • Figure 13: Natural product supermarket retail sales of packaged salads at current prices and inflation-adjusted prices, 2006-08
• Natural supermarket channel sales, salad dressings
  • Figure 14: Natural product supermarket retail sales of salad dressings at current prices and inflation-adjusted prices, 2006-08
• Natural channel sales of packaged salad by organic
  • Figure 15: Natural product supermarket retail sales of packaged salads, by organic, 2006-08
• Natural channel brand sales
  • Figure 16: Manufacturer brand natural supermarket sales of packaged salads, 2006 and 2008
• Niche salad dressings brands doing well in the natural channel
  • Figure 17: Manufacturer brand natural supermarket sales of salad dressings 2006 and 2008
• Natural channel sales of salad dressings by organic
  • Figure 18: Natural product supermarket retail sales of salad dressings, by organic, 2006-08
• Market Drivers
• Key points
• Weight management concern and the desire to live a healthier lifestyle is driving salad sales
  • Figure 19: Percentage of population who are overweight or obese, 20-74 years of age, 1988-2004
  • Figure 20: Average daily per capita calories consumed,* by food group, 1970-2004
• Rise in the proportion of people currently "controlling diet" and watching fiber intake rose after 2004 and has remained high
  • Figure 21: Attitudes about diet, trended, 2001-07
• Desire to achieve better health directly influences shopping decisions
  • Figure 22: Factors that influence grocery shopper' s purchase decisions "a lot," 2006
• Added convenience has high appeal to time-starved consumers
  • Figure 23: Attitudes and behaviors related to cooking, September 2007
• Salad remains a popular dinner item
  • Figure 24: What consumers have for dinner, November 2007
• Leading Companies
• Key points
• Fresh Express still leads the market but private label shows impressive growth
• Dressing manufacturers struggle
  • Figure 25: FDMx sales of packaged salad, by company and brand, 2007 and 2008
• Brand Share -- Packaged Salads
• Key points
• Chiquita' s Fresh Express brand dominates the packaged salad market
• Food safety concerns and product recalls hurt Dole
• Private label is growing fast
• Packaging innovation need to spur usage occasions and drive sales
  • Figure 26: FDMx sales of packaged salad, by company and brand, 2007 and 2008
• Brand Share Salad Dressings
• Key points
• Shelf stable pourable dressings sales on the decline
• Unilever' s innovative Spritzers see slight growth
• Niche brands Ken' s Steakhouse and Newman' s Own growing
  • Figure 27: FDMx sales of shelf stable pourable dressings, 2007-08
• Refrigerated dressings hold their ground
  • Figure 28: FDMx sales of refrigerated salad dressings, 2007-08
• Dressing mixes are a small segment of the market that is not ideally positioned relative to the health driver
  • Figure 29: FDMx sales of salad dressings mix brands, 2007-08
• Coleslaw dressings
  • Figure 30: FDMx sales of coleslaw dressings mix brands, 2007-08
• Brand Qualities
• The Fresh Express brand communicates specific qualities that help it to maintain market dominance
• Newman' s Own leverages gourmet positioning along with social responsibility, purity and sustainability to create a unique and desirable brand proposition
• Innovation and Innovators
• Key points
• Premium salads help people achieve restaurant-style dining experiences
• Salad kits will help take salads from a side dish to an entrée
• Salad Sprays change the nature of dressing and effectively leverage demand for lower calorie dressings
• Unilever' s Wish-Bone Bountifuls appeal to the desire for pure, whole ingredients
• Advertising and Promotion
• Key points
• Advertisers seek emotional connections with high value customers
• In-store marketing can be used to add value by creating perceptions of purity, freshness and a sense of being close to the origin of the food
• Kraft appeals to the desire for more wholesome foods with PureKraft
  • Figure 31: Purepare yourself for a whole new Kraft, 2008
• Clorox' s Hidden Valley Ranch ads create a sense of simple pleasures, and appeal to the need to make vegetables appealing to children
  • Figure 32: Hidden valley ranch salad, 2007
  • Figure 33: Hidden valley ranch salad, 2007
• Unilever' s Wish-Bone Bountifuls emphasize differentiation and a new salad experience
  • Figure 34: Wish-bone Bountifuls salad, 2007
• Packaged Salads Usage and Consumption
• Key points
• Women, blacks, and Hispanics are heavy users of packaged salad products
  • Figure 35: Packaged salad or packaged greens use, by children in the household, June 2008
  • Figure 36: Packaged salad or packaged greens use, by children in the household, June 2008
  • Figure 37: Packaged salad or packaged greens use, by race/ethnicity, June 2008
• Black, Hispanic, and affluent consumers eat more salads per week
  • Figure 38: Mean number of salads eaten in the past week, by race/ethnicity, June 2008
  • Figure 39: Average number of salads consumed in the past week, by income, June 2008
• Types of Salad and Packaged Greens Used
• Key points
• Ethnicity drives packaged salad and greens preference
  • Figure 40: Types of salad greens purchased, by race/ethnicity, June 2008
• Affluent consumers tend to eat a wider variety of greens
  • Figure 41: Type of packaged greens used, by income, June 2008
• Salad Dressing Usage and Consumption
• Key points
• Most households use salad dressing but they are not using as much as before
  • Figure 42: Trended salad dressings use, by sub-category, 2002-07
  • Figure 43: Incidence of prepared salad dressings use, by race/ethnicity, January-November 2007
  • Figure 44: Volume of salad dressings used, by race/ethnicity, January-November 2007
• Types of salad dressing used
  • Figure 45: Type of salad dressings used, by race/ethnicity, January-November 2007
• Flavors of salad dressing used
  • Figure 46: Flavors of prepared salad dressings used, by race/ethnicity, January-November 2007
• Brands of Salad Dressing
• Ethnicity influences brand usage
  • Figure 47: Brands of salad dressings used, by race/ethnicity, January-November 2008
• Attitudes and Motivations
• Key points
• 18-34s are more likely to eat salad for lunch or a snack
  • Figure 48: Occasion based packaged salad use, by age, 2008
• Blacks and Hispanics are more likely to wash their packaged greens and report only purchasing organic salad greens
• Consumers are not convinced of the value of "prewashed"
• Packaging is a problem
• Organic salads and greens are less popular than expected
  • Figure 49: Attitudes about packaged salads, by race, 2008
• Still mainly for tossed salads
  • Figure 50: Use for purchased greens, by race, 2008
• Why aren' t consumers buying packaged salads? They often prefer to buy greens in bulk
  • Figure 51: Reasons packaged salad greens are not bought, by income, 2008
• Blacks and Hispanics have a slightly higher affinity for salad dressings
• Figure 52: Salad greens and dressings attitudes, by race, 2008
• Appendix: Simmons cohorts
  • Figure 68: Married couples cohorts
  • Figure 69: Single women cohorts
  • Figure 70: Single men cohorts
• Appendix--Useful Consumer Tables
• Lifestyle and habits
  • Figure 71: Attitudes toward health and diet, by gender, May 2005-June 2006
• Salad and dressing usage tables
  • Figure 72: Types of packaged greens purchased, by age, June 2008
  • Figure 73: Type of salad dressings used, by age, January-November 2007
  • Figure 74: Flavors of prepared salad dressings used, by age, January-November 2007
• Mayonnaise/mayo-type salad dressings
  • Figure 75: Mayonnaise/mayo-type salad dressings use, by custom consumer groups, January 07-November 07
  • Figure 76: Fat-free/Non-fat mayonnaise/mayo-type salad dressings use, by custom consumer groups, January 07-November 07
  • Figure 77: Light/low-fat mayonnaise/mayo-type salad dressings use, by custom consumer groups, January 07-November 07
  • Figure 78: Low cholesterol mayonnaise/mayo-type salad dressings use, by custom consumer groups, January 07-November 07
  • Figure 79: Regular mayonnaise/mayo-type salad dressings use, by custom consumer groups, January 07-November 07
• Appendix: Trade Associations