Healthy Snacking - US - June 2009

Table of Contents

• Scope and Themes
• What you need to know
• Definition
  • Figure 1: Foods eaten as snacks and as healthy snacks, February 2009
• Data sources
• Sales data
• Consumer survey data
• Advertising creative
• Abbreviations and terms
• Abbreviations
• Terms
• Executive Summary
• Market at a glance
• Challenges abound
• But so do opportunities
• 12 diverse segments show mixed results through FDMx
• Innovations include fortified/functional versions of familiar snacks and new snacks that blur category lines
• What is a healthy snack?
• What do people want in healthy snacks?
• Race/Hispanic origin affects views on snack foods
• Better-for-you and better-for-planet positioning of SunChips
• Creating a weapon against "bad" snacks helps promote sales
• Market Size and Forecast
• Key points
• Snack food sales rise, but not as fast as inflation
• Volumes decline while prices rise
  • Figure 3: FDMx sales of healthy snacks, at current prices, 2003-13
  • Figure 4: FDMx sales of healthy snacks, at inflation-adjusted prices, 2003-13
• Competitive Context
• Key points
• More competition from private label
• Snack bars
• Yogurt
• QSR value menus and snacks continue to compete for snack dollars
• Innovation in natural/organic markets gives direction for larger healthy snacking market
• Segment Performance
• Key points
• Dairy segments show strong growth
• Fiber in snack bars has sparked new interest in a stagnating segment
• Trail mix and rice/popcorn cakes grow
• Dried fruit/snacks and BFY chips grow slowly
• Sales and forecast
  • Figure 5: FDMx sales of healthy snacks, by segment, 2006 and 2008
• Segment Performance--Cheese
• Key points
• Natural cheese carries segment
• Most forms of natural cheese grow
• Natural cheese takes share from processed
• Incidence of eating cheese as a healthy snack
  • Figure 6: Incidence of eating cheese as a snack and as a healthy snack, 2009
• Segment Performance--Cereal
• Key point
• Mature segment with little growth
• Thinking outside the box
• Healthier options come at a premium
• Incidence of eating cereal as a healthy snack
  • Figure 7: Incidence of eating cereal as a snack and as a healthy snack, 2009
• Segment Performance--Crackers
• Key points
• Uneven sales results vary by type of cracker
• Baked and wholegrain versions propel sales
• Incidence of eating crackers as a healthy snack
  • Figure 8: Incidence of eating crackers as a snack and as a healthy snack, 2009
• Sales and forecast
  • Figure 9: FDMx sales and forecast of crackers, at current prices, 2003-13
• Segment Performance--Yogurt
• Key points
• Strong growth through innovation and the addition of new flavors
• Functional benefits grow segment
• Dessert-flavored yogurts complement traditional fruit varieties
• Superfruits find a new medium
• Incidence of eating yogurt as a healthy snack
  • Figure 10: Incidence of eating yogurt as a snack and as a healthy snack, 2009
• Segment Performance--Energy, Cereal, Diet and Snack Bars
• Key points
• Inherent portability and convenience grow segment
• Bars are packed with fiber
• Sales of nutrition and energy bars in the natural channel
  • Figure 11: Natural product supermarket retail sales of nutrition and energy bars, at current prices, 2006-08
• Incidence of eating energy/diet/cereal/snack bars as a healthy snack
  • Figure 12: Incidence of eating energy/diet/cereal/snack bars as a snack and as a healthy snack, 2009
• Segment Performance--Nuts and Seeds
• Key points
• Sales rise even amid safety concerns
• Snack nuts are taking on new shapes and flavors
• Recalls have not had severe negative effects
• Incidence of eating nuts and seeds as a healthy snack
  • Figure 13: Incidence of eating nuts and seeds as a snack and as a healthy snack, 2009
• Sales and forecast
  • Figure 14: FDMx sales and forecast of nuts and seeds, at current prices, 2003-13
• Segment Performance--Dried Fruit and Fruit Snacks
• Key points
• Fruit snacks a drag on sales
• Superfruits attract attention to the segment
• Prunes get a makeover
• Interest in other dried fruits detracts from raisins
• Incidence of eating dried fruit and fruit snacks as a healthy snack
  • Figure 15: Incidence of eating dried fruit and fruit snacks as a snack and as a healthy snack, 2009
• Sales and forecast
  • Figure 16: FDMx sales and forecast of dried fruit and fruit snacks, at current prices, 2003-13
• Segment Performance--BFY Chips
• Key points
• Olestra and Light chips drag on sales
• Whole grains and baked chips drive sales
• Incidence of eating potato/corn chips as a healthy snack
  • Figure 17: Incidence of eating potato/corn chips as a snack and as a healthy snack, 2009
• Sales and forecast of BFY chips
  • Figure 18: FDMx sales and forecast of BFY chips, at current prices, 2003-13
• Segment Performance--Popcorn
• Key points
• Diacetyl concerns and lack of innovation stifle growth
• RTE and kernel go organic
• Incidence of eating popcorn as a healthy snack
  • Figure 19: Incidence of eating popcorn as a snack and as a healthy snack, 2009
• Sales and forecast
  • Figure 20: FDMx sales and forecast of popcorn, at current prices, 2003-13
• Segment Performance--Pretzels
• Key points
• Thins and crisps and flavored varieties grow sales
• Incidence of eating pretzels as a healthy snack
  • Figure 21: Incidence of eating pretzels as a snack and as a healthy snack, 2009
• Sales and forecast
  • Figure 22: FDMx sales and forecast of pretzels, at current prices, 2003-13
• Segment Performance--Trail Mix
• Key point
• Exotic mixes give new life to the segment
• Incidence of eating trail mix as a healthy snack
  • Figure 23: Incidence of eating trail mix as a snack and as a healthy snack, 2009
• Sales and forecast
  • Figure 24: FDMx sales and forecast of trail mix, at current prices, 2003-13
• Segment Performance--Rice/Popcorn Cakes
• Key points
• Rice cakes struggle to deliver the flavor consumers want
• Incidence of eating rice/popcorn cakes as a healthy snack
  • Figure 25: Incidence of eating rice/popcorn cakes as a snack and as a healthy snack, 2009
• Sales and forecast
  • Figure 26: FDMx sales and forecast of rice/popcorn cakes, at current prices, 2003-13
• Market Drivers
• Key points
• Unemployment and fears of job loss lead consumers to tighten food budgets
  • Figure 27: Seasonally adjusted unemployment rate, 16 years and older, by month, 2000-09
• Weight issues create market for healthier alternatives
  • Figure 28: Age-adjusted* prevalence of overweight and obesity among U.S. adults, age 20 and over, 1988/94-2005/06
• Childhood obesity is an ongoing concern
  • Figure 29: Prevalence of overweight among children and adolescents aged 6-19 years, 1971/74-2005/06
• Growth in food allergies creates market for low-allergen foods
• More people reading labels means fewer foods may be seen as "healthy"
• Selected Brand Analysis--Cheese
• Key points
• Kraft processed and natural sales take a tumble
• Sargento grows on natural products
• Manufacturer and brand sales
  • Figure 30: Selected FDMx brand sales of cheese, 2008 and 2009
• Selected Brand Analysis--Cereal
• Key point
• Kashi meets BFY demand and hits popular price point
• Special K as a dieter' s friend
• Manufacturer and brand sales
  • Figure 31: Selected FDMx brand sales of cereal, 2008 and 2009
• Selected Brand Analysis--Crackers
• Key point
• More BFY brands hit FDMx
• Whole grains and baked varieties boost traditional brands
• Toasted versions are on the decline
• Manufacturer and brand sales
  • Figure 32: Selected FDMx brand sales of crackers, 2008 and 2009
• Selected Brand Analysis--Yogurt
• Key points
• Brands promoting digestive health thrive
• Manufacturer and brand sales
  • Figure 33: Selected FDMx brand sales of yogurt, 2008 and 2009
• Selected Brand Analysis--Energy, Cereal, Diet and Snack Bars
• Key points
• Fiber continues to reinvigorate category
• Sales of diet bars uneven
• Manufacturer and brand sales
  • Figure 34: Selected FDMx brand sales of energy/cereal/diet/snack bars, 2008 and 2009
• Selected Brand Analysis--Nuts and Seeds
• Key point
• Innovative packaging helps consumers count calories
• Kraft expands its natural offerings
• Manufacturer and brand sales
  • Figure 35: Selected FDMx brand sales of nuts and seeds, 2008 and 2009
• Selected Brand Analysis--Dried Fruit and Fruit Snacks
• Key points
• Antioxidants and fiber hit the sweet spot
• Manufacturer and brand sales
  • Figure 36: Selected FDMx brand sales of dried fruit and fruit snacks, 2008 and 2009
• Selected Brand Analysis--BFY Chips
• Key points
• BFY snack giants lose traction
• Manufacturer and brand sales
  • Figure 37: Selected FDMx brand sales of BFY chips, 2008 and 2009
• Selected Brand Analysis--Popcorn
• Key points
• Natural and organic are the key words
• Smart Food appears in your microwave
• Pop Secret changes hands
• Manufacturer and brand sales
  • Figure 38: Selected FDMx brand sales of popcorn, 2008 and 2009
• Selected Brand Analysis--Pretzels
• Key point
• Snyder' s multigrain misses mark
• Manufacturer and brand sales
  • Figure 39: Selected FDMx brand sales of pretzels, 2008 and 2009
• Selected Brand Analysis--Trail Mix
• Key point
• Kraft launches more natural products
• Manufacturer and brand sales
  • Figure 40: Selected FDMx brand sales of trail mix, 2008 and 2009
• Selected Brand Analysis--Rice/Popcorn Cakes
• Key point
• Highly concentrated segment owned by Quaker Oats Company (PepsiCo)
• Manufacturer and brand sales
  • Figure 41: Selected FDMx brand sales of rice/popcorn cakes, 2008 and 2009
• Brand Qualities
• Key point
• SunChips, the better-for-the-planet snack
• Innovation and Innovators
• Omega-3 and antioxidants in new versions of familiar snacks
• Nut crisps offer a non-traditional way to consume nuts
• Advertising and Promotion
• Key points
• Manufacturer initiatives
• PepsiCo Inc.
• Quaker Foods
• Frito-Lay
• A Woman' s World (Frito-Lay)
  • Figure 42: Awomansworld.com (Frito-Lay) TV ad, 2009
• Brand-specific ad activity
• Kashi wants to make all eating occasions healthier
• Philadelphia Cream Cheese (Kraft Foods) is not just for breakfast anymore
• Emerald Nuts (Diamond Foods) uses humor
• Yoplait Whips (General Mills) become an indulgent, but healthy treat
  • Figure 43: Yoplait Whips TV ad, 2008
• Dannon Light & Fit (Groupe Danone) is too good to resist
  • Figure 44: Dannon Light & Fit TV ad, 2009
• Activia (Groupe Danone) works or your money back
• Kellogg' s Special K (Kellogg Co.) competes with traditional chocolate treats
  • Figure 45: Kellogg' s Special K Chocolately Delight TV ad, 2009
• Sunsweet Ones (Sunsweet Growers) aren' t your grandparents' prunes
  • Figure 46: Sunsweet Ones TV ad, 2007
• Partnerships with retailers
• What is a Healthy Snack?
• Key points
• Snacks more likely to be salty than fruity
  • Figure 47: Foods eaten as snacks and as healthy snacks, February 2009
• Women have a broader view of what makes a healthy snack
  • Figure 48: Foods eaten as snacks, by gender, February 2009
  • Figure 49: Foods eaten as healthy snacks, by gender, February 2009
• Healthy snacking is a daily occurrence
  • Figure 50: Incidence of eating a healthy snack, February 2009
• Attitudes and Motivations
• Key points
• Attributes that make a snack healthy
  • Figure 51: Important attributes when choosing a healthy snack, by gender, February 2009
• Younger adults willing to sacrifice taste for health, while older adults look for what' s not in a snack
• The search for energy not limited to drinks
  • Figure 52: Important attributes when choosing a healthy snack, by age, February 2009
  • No surprise--women place higher value on healthy eating
  • Figure 53: Behaviors and opinions towards healthy snacking, by gender, July 2007-September 2008
• Healthy eating concerns appear to be grown into
  • Figure 54: Behaviors and opinions towards healthy snacking, by age of head of household, July 2007-September 2008
• Majority of respondents have not let the down economy impact their snacking habits
  • Figure 55: How snacking habits have changed along with changes in economy, by age, February 2009
• Race and Hispanic Origin
• Key points
• Black and Hispanic respondents show higher interest in price and nutrition
  • Figure 56: Important attributes when choosing a healthy snack, by race/Hispanic origin, February 2009
• Hispanics least likely to snack between meals, but most likely to try new healthy snacks
  • Figure 57: Behaviors and opinions towards healthy snacking, by race/Hispanic origin, July 2007-September 2008
• Hispanics changing snacking habits with economy
  • Figure 58: How snacking habits have changed along with changes in economy, by race/Hispanic origin, February 2009
• Appendix: Other Useful Consumer Tables
• Detailed sample sizes for foods eaten as snack and considered a healthy snack
  • Figure 72: Foods eaten as snacks and as healthy snacks, February 2009
• Appendix: Trade Associations