First to the Table
Q&A on Shopper Insights
With Tony Luciano, Director Category Leadership Snacks, Kraft Foods, Inc.
Snacking has become a major consumer behavior and presents tremendous growth potential for retailers. Snacking, or between-meals eating, has become part of a healthy lifestyle as consumers often opt for moderation and look for better-for-you products in the store.
Snack categories in supermarkets are under pressure because consumers are shopping for these products in multiple channels — even including quick-service restaurants such as McDonald's and Quiznos.
Consequently, capturing snack sales calls for focused action. The first step in a successful snacking strategy is a thorough understanding of consumers and their snacking needs and occasions, along with knowing the key trends affecting the category. For a closer look at snacking and ways to spur category growth, Supermarket News spoke with Tony Luciano, Director Category Leadership Snacks, Kraft Foods, Inc.
SN: What do your consumer insights tell you about the state of snacking in America?
Luciano: Snacking continues to grow. We hear from consumers that snacking, when done in moderation, can help manage their hunger, weight, and energy levels. We expect the trend for increased snacking and eating more mini-meals to continue.
SN: What are the typical snacking occasions for most people?
Luciano: The old answer many years ago would have been that snacking occasions tended to occur later in the day. To some extent, that's still true. But when you look at it, consumers today are really snacking throughout the day. You could almost call Snacking 24-7. We really don't see a typical occasion.
For example, morning snacking continues to grow, which is just further evidence that consumers see that snacking isn't limited to one occasion or day part.
SN: What drives consumers to snack throughout the day? Is it just hunger?
Luciano: To some degree, yes. There are two main motivations: functional and emotional. On a functional level, consumers tend to snack when they're hungry or want to maintain their energy levels. But we also know that consumers will snack as kind of a reward or a treat.
Consumers tend to snack more on wholesome items earlier in the day to satisfy hunger or the need for more energy. They tend to snack on more indulgent-tasting and rewarding items later in the day.
SN: Please list the different snack categories and what their roles are to drive category growth.
Luciano: When we look at the snacking universe, we see twelve main categories that represent over $90 billion in snacking occasions. They include cookies, crackers, nuts, bars, candy, salty and meaty snacks, pudding and gelatin, ice cream, fruit, yogurt and pastries. Then, there is what we call a "Super 7" category of snacks that includes cookies, crackers, nuts, bars, pastries, candy, and salty and meat snacks. Those "Super 7" categories represent over $60 billion in sales.
Cookies, crackers, and salty snacks really draw traffic to the store and into the aisle. The main profit contributors are nuts and pastries. There are a number of products that are transaction builders, helping to increase the total register ring — cookies, crackers, nuts, bars, and candy. The cash generator is salty and meat snacks.
- Little Luxuries
- Whether it's cupcakes or cookies, mini-tarts or gourmet brownies, small desserts have become a big draw in many supermarket bakery departments. The growing popularity of single-serve sweets and snacks is proof that big things do come in small packages. Retailers and analysts say there's a number of reasons for the trend.
- On the Rise
- Sales of bakery treats are up, as comfort foods like cookies, cakes and doughnuts appeal to shoppers during hard times. Other contributing factors are the fact that sweet snacks are an impulse purchase, price inflation and increased store traffic due to the downturn.
- Sugar Surge
- Candy sold at the movie theater falls into the pricey $4 to $5 range. So given movie candy's portability, it makes sense that cash-strapped theater-goers would stop at their local food store, rather than go without their favorite snacks. Value-priced theater boxes of candy have turned supermarkets into a pre-movie destination.
- Consumer Mindshift
- The recession has redefined the supermarket shopper. Meanwhile, suppliers aren't quite ready to pass on permanent price reductions, but they are providing value in more prudent ways. Makers of products merchandised in Center Store are also experimenting with size.
Have a burning question related to smart snacking? Ask Kraft Foods' expert, Tony Luciano, Director Category Leadership Snacks, Kraft Foods, Inc..