Suppliers and wholesalers are partners in the grocery industry – it is in their mutual interest that cash & carry depots maximise sales from every category.
Wholesale Manager asked leading suppliers from the crisps, snacks & nuts, sports & energy and snacking categories how wholesalers can grow those categories and what are the major trends driving sales. This category management guide offers suggestions for wholesalers to boost their turnover.
The suppliers have also told us what activity they are running to support their brands.
A KP Snacks spokesperson comments: “CSN is a fast growing, priority category with huge scale.”
Worth £3.5bn and growing at +4.6% YOY (Nielsen), bagged snacks remain a vital driver of growth within Convenience and demand shows no sign of slowing.
“We’re seeing dynamic change across the category, and retailers can bank on bagged snacks to drive sales and footfall by stocking the right range and formats. The No.1 CSN category driver is taste, and we are in the business of making great tasting snacks, across all snacking segments (crisps, snacks, nuts, popcorn), delivered in all formats (singles, multipacks, sharing) and up and down the value spectrum,” adds the spokesperson. “As a priority segment, we expect to continue to see substantial growth in sharing,” the spokesperson says.
The sharing segment is the largest in Crisps, Snacks and Nuts (CSN), worth £1.4bn and growing strongly at +6.9% MAT (Nielsen). Together Time is the largest category opportunity due to the size of the sharing occasion and snacks are a hugely important part of this.
Over the coming months, many consumers are still going to be choosing to spend more time at home and will be striving to make the ‘BNI’ feel like a ‘BNO’- whether it be a movie night, or a drink with the perfect snack accompaniment. 49% say snacks are a must have for an evening in (Mintel), which have become the norm since the pandemic.
Health is also becoming increasingly important to shoppers. Healthier bag snacks are now worth £11m in impulse, with sharing growing by 17% across independents and symbols.
“While there was format and segment switching during the pandemic, wholesalers need to prioritise the category and continue to drive growth by capitalising on key macro trends including food to go,” suggests the spokesperson.
With a successful vaccine roll-out and full reopening of hospitality, food to go occasions have been on the up. Crisps and snacks are the second largest category that shoppers are purchasing on the go, second only to soft drinks (HIM) so a key driver of sales in C&I.
Singles and PMPs will play a prime role in rebuilding the food-to-go category, with 83% of retailers saying that PMPs sell faster than non-PMPs (Mintel).
“For manufacturers and retailers looking to win in the on-go category, it’s key that they are offering the right core range in the right formats, boosted with the right promotions and merchandising,” the spokesperson advises.
KP’s £1 PMP portfolio is currently worth £65.6m (Nielsen) RSV, and is growing at +10.1%, out-performing market £1 PMP growth (Nielsen). The company offers retailers 25 PMPs across the KP family and continuously looks to add value to retailers with both variety and promotion. McCoy’s Sizzling King Prawn was recently introduced to the portfolio, with several more additions to come this year.
“Wholesale is a highly valued and strategically important route to market and we’ve helped wholesalers grow their CSN sales through a number of incentives and support materials/ guides, including perfect store and perfect online depot, giving retailers advice on how to maximise their bagged snacks sales and some simple merchandising principles all underpinned with category trends and insights,” adds the spokesperson. “We ensure that we offer the right products in the right format such as PMPs, and also run a range of retailer reward schemes in collaboration with wholesalers.”
Last summer, KP Snacks teamed up with Bestway to offer retailers the opportunity to win the ultimate ‘money can’t buy’ experience at cricket’s newest tournament, The Hundred. This year KP looks forward to building on its partnership with The Hundred and in doing so, help wholesalers and independent retailers drive sales.
In 2021, KP delivered innovation and new advertising across its portfolio, including McCoy’s, popchips, Tyrrells and KP Nuts. Multi-brand promotion Win £2021 also gave consumers the chance to win £2021 each with a total prize fund of £50K. This helped revitalise singles sales by giving both retailers and consumers an incentive to purchase.
In 2022 Q1, KP will be putting further spend behind McCoy’s, with a £1M media investment into the ongoing ‘Don’t Deny the Beast’ campaign, heroing McCoy’s Thai Sweet Chicken flavour.
The Hundred will also be supported again this year, covering a number of key brands. As the Official Team Partner of The Hundred, KP Snacks brands popchips, Butterkist, POM-BEAR, Tyrrells, KP Nuts, Hula Hoops, McCoy’s, and Skips, will all feature on team shirts. Driving association of KP Snacks and The Hundred, the brands will once again feature in broadcast advertising, as well as through in-ground promotion on the big screens.
A Red Bull spokesperson comments: “Today, Sports & Energy is worth £1.6bn, with growth totalling over £240.3m vs 2021 (Nielsen). This growth has been fuelled by the increasing demand for Functional Energy.”
These drinks have added over £187.6m vs 2021 and have approached the billion-pound segment, today worth over £1.1bn annually (Nielsen). The consistent performance of Functional in the category has ensured that Sports & Energy has remained in growth, with Functional Energy the fastest growing segment in Sports & Energy at +19.6% YTD (Nielsen).
“By offering a wider choice of Functional Energy SKUs, from low-sugar options to flavoured variants you can ensure your outlet appeals to a broad range of shopper behaviours,” says the spokesperson.
With the heightened importance placed on the health agenda, it’s important to offer consumers the added choice that they are looking for.
Sugarfree variants are growing penetration by 24.3% (Kantar), displaying growing demand for low-calorie options.
In the last year, Red Bull sold 16.0% more sugar free volume through multipacks (Nielsen) – with these variants growing frequency by 28.0% (Kantar).
“Ensure each SKU has a Sugarfree alternative easily available to consumers who are increasingly choosing these,” suggests the spokesperson.
It’s not only Sugarfree variants that have grown penetration over the last year either, with tropical and exotic flavours growing at a rate of +44% vs all other mainstream flavours on offer (Nielsen).
“Now is the perfect time for wholesalers to stock up on new flavour formats to maximise their sales over the course of 2022 as we see shoppers buy Red Bull Editions more frequently with average frequency +129.6% vs YA,” adds the spokesperson.
Due to this major increase in consumer demand for added flavoured benefits and high trade success throughout the summer in markets worldwide, the Cactus Fruit Edition has become a permanent fixture within the portfolio. As of December 2021, it is now known as the Green Edition, becoming an exciting permanent addition to Red Bull’s product range and driving further growth of flavours to the overall Sports & Energy Category.
A General Mills spokesperson comments: “With life now returning to some sort of normal, and more people on the move, the future is looking bright for the snacking market. Guilt-free and more permissible snacks are in demand as consumers look for options to help them stick to healthier habits, especially in a post-pandemic world of hybrid working.”
Nearly half of people who work both at home and in the office said they are conscious of what they eat to stay healthy (Glanbia).
More and more, ‘better-for-you’ means ‘better-for-your-business’. Snack bars are forecast to grow 14% over the next three years (Euromonitor) as confectionery and sweet biscuits become a smaller part of the in-between-meals repertoire.
“With an accelerated need for better-for-you options, there has never been a more important time for retailers to give dedicated space in store to products at the lower calorie, nutrient-fortified or minimally processed end of the snacking spectrum,” says the spokesperson.
Snacks which boost nutrition through added fibre or protein, those fortified with vitamins, or those that help consumers get their five-a-day or reach certain lifestyle goals are in high demand; 44% think that snacks are a good way to add nutrients to your diet (Mintel).
The pandemic has led to more and more shoppers avoiding ‘processed’ snack bars, and switching to whole and raw ingredients, such as nuts, fruit and wholegrain. A provenance story is also a huge selling point; consumers want to know how and where their food has been grown or made.
While consumers are looking for healthier options, they’re not willing to compromise on taste. They want the best of both worlds and look for flavour cues from traditionally more indulgent products.
Nature Valley’s Crunchy platform, made with 100% wholegrain oats, is worth more than £31 million and is a significant driver of growth in the ‘better-for-you’ snacking category.
Now, to further support the convenience channel and drive impulse purchase, the brand has designed a new price-marked pack offer – two Nature Valley singles for £1 RRP.