First to the Table
Q&A on Shopper Insights
With Tony Luciano, Director Category Leadership Snacks, Kraft Foods, Inc.
SN: What is Kraft Food's philosophy of "Smart Snacking"?
Luciano: Our philosophy is that everything needs to be done in moderation. A healthy lifestyle is really about balance — whether it's with your diet or your lifestyle. Smart Snacking, if done properly, can help people maintain proper weight and good health.
SN: What are the major trends affecting snacking and the category?
Luciano: The population continues to change. There will be more seniors and Hispanic-Americans in the future, and both trends will affect snacking.
As consumers age, they tend to snack more between meals. Also, their needs will evolve, particularly around health and wellness. That's where Smart Snacking comes in.
Meanwhile, Hispanic consumers — much like every consumer group — have different needs than others. This is a growing group that clearly will have different needs for snacking. It's going to be critical that those needs get addressed in order to be able to grow the business. We have some great brands like Oreo and Chips Ahoy that do extremely well with Hispanic consumers. Others are not as strong relative to how strong those brands are with different consumer groups.
Another trend deals with health and wellness. Consumers are realizing that snacking can actually be a great part of a healthy lifestyle. They're looking for ways to improve their health and wellness by adding just a consideration above and beyond the number one thing that consumers want — great taste.
SN: Do you think that supermarket retailers truly understand the potential for losing snack sales to other classes of trade?
Luciano: I do see grocery retailers being very aware of where consumers are buying different products. In the grocery business, whether it is in food categories or non-food categories, there have certainly been products where retailers have lost a lot of share to other channels. Laundry detergent is one great example. The grocery share of laundry products today is under 30% while many years ago it was significantly higher. Nuts are one category where grocery has seen its share drop below 50%.
Retailers are very aware that it's critical to develop the right strategies, programs and tactical solutions in-store — whether it is assortment, shelving adjacencies or whatever it might be — to address the latest trends.
It's also important for them to do this today because the competition for snacking is much broader than products sold in a grocery store. Consumers can even go to quick service restaurants for snack-sized menu items. So I think a lot of retailers today are recognizing that the snacking occasion is growing, and are trying to get in on the action.
SN: How is Kraft Foods working with supermarket retailers to help them present the snack categories to shoppers in the best way possible?
Luciano: We are working collaboratively with them and look to be first with innovative strategies.
Our shopper insights organization is very robust. Those executives —particularly within our cookie, cracker and nut categories—tend to be the category captains or advisors to our retailers.
We've put together a category management framework that provides detailed recommendations for our core cookie, cracker and nut categories with implications for each of our retailers. This framework is helping us all think strategically about winning in these categories and winning with snacking. And, included are all of the tactical decisions that would flow from that kind of thinking.
We want to lead. So we take a look at a whole array of consumer, shopper, category and retailer insights to come up with some fact-based principles that will help to drive growth. Our retail partners are working with our shopper insights team and the sales people on our teams to see how they can combine those learning's with account-specific insights that can be used to help develop stronger strategies and plans that ultimately drive greater category growth.
- 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..