The key trends driving snack segment growth – Food Business News

LAS VEGAS — The snack category is growing quickly, and manufacturers are evolving offerings to meet emerging consumer demands. Salty snack sales grew nearly 16% in 2022 to reach $28 billion, according to the market researcher Circana, and are projected to reach $38 billion by 2028, according to Mintel.
At Pack Expo 2023, held Sept. 11-13 in Las Vegas, David Walsh, vice president of membership and communication for the trade group SNAC International, highlighted the most significant trends driving the snack category’s momentum.
Forty-nine percent of consumers are snacking more than three times per day, Mr. Walsh said, up 8% in the last two years. Younger generations like millennials and Generation Z are driving the accelerating trend.
“They’re most likely to replace a meal with a snack, as 92% replace at least one meal a week with a snack,” Mr. Walsh said. “And as their buying powers increase…it’s leading to more dollars going into the snack category.”
He added that the late-night daypart is ripe for opportunity.
“Cravings for calorie-dense foods peak at night, as well as overall appetite … it creates the perfect storm,” he said. “Large companies and investors know this, and they see it as a matter of ‘when, not if’ we’ll see snacks specifically catered to the nighttime snacker.”
The pandemic boosted snack consumption as consumers turned to snacks as a source of familiarity and comfort. But subsequent inflationary pressures have shifted the way they’re purchasing snacks. Twenty-five percent of consumers are now looking to buy what’s on sale, up 3% from two years ago, while 20% of consumers are buying less assortment of snacks for their household to save money, up 7% over the last two years.
Using flavors to differentiate
When it comes to flavor, spicy offerings are posting strong unit growth across numerous snack categories. Mr. Walsh said consumers are gravitating toward spicy flavors with added nuance.
“It’s not just heat, but different types of peppers like ghost pepper, habanero, hints of lime, chili, chipotle, adobo, hot paired with cheese, just to name a few examples,” he said.
On the sweet side, berry, cinnamon and chocolate nut flavors are trending, while lime and tangy tamarind varieties are growing amongst tangy snacks.
Global flavors are increasing across snacks as well, including Latin American, Asian and Middle Eastern flavors. Mr. Walsh emphasized that this growing global influence is here to stay.
“As consumers are trying to make their dollar stretch a little bit further, these international flavors are creating an opportunity for snack makers to deliver more ‘foodie’ and elevated experiences while consumers are continuing to stay home,” he said.
While there has been some growth in the market for better-for-you (BFY) snacks, indulgence remains the primary reason for snacking. Fifty-four percent of consumers want a snack as a treat, according to Mintel, while only 22% are motivated by health.
Mr. Walsh observed this gap may be due in part to inflation, and that consumers will opt for more BFY snacks once their purchasing power increases.
“Indulgence will never go anywhere; sometimes consumers just want their favorite snack,” he said. “But better-for-you is definitely still alive and well.”
Trending BFY snack attributes include prebiotics, probiotics, antioxidants and a serving of fruits or vegetables. Allergen-free and allergen-friendly snacks also posted strong dollar (25%) and unit (8.7%) growth in 2022 as did plant-based protein. Snacks featuring protein continue to perform exceptionally well, with snacks offering 15+ grams of protein growing 40%.
“There’s really a group of consumers that will pay more for their healthier snacks, so this just shows they’re putting their money where their mouth is,” Mr. Walsh said.
Consumers, especially younger ones, also are seeking brands that represent their personal values, including social and environmental awareness, Mr. Walsh said. But he noted that snack makers should home in on a specific message.
“According to Innova, 55% of consumers say there are too many environmental labels, so they don’t know what they’re looking for,” he explained. “Food producers should really pick a cause that’s important to them and resonates with their company so that consumers go that route.”
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