Dash of differentiation
To make their own-brand products stand out from their competitors offerings, food retailers have a number of options. They could aim for a match to a national brand product and rely on a decent price gap as a differentiator. Or they could rely on a unique packaging format or label design to attract attention. But if they really want to set their store brand food and beverage items apart from the crowd, they could use flavors and ingredients that result in truly differentiated offerings.
Some retailers, of course, already excel here. Victoria Vaynberger, marketing and consumer insights manager for flavor company David Michael & Co., Philadelphia, points to Minneapolis-based Target Corp. as a leader here.
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\"Their premium private label line, Archer Farms, thrives on churning out products with innovative on-trend flavors that easily compete with the major brands,\" she says. \"Organic key lime white chocolate cookies, balsamic almonds, hazelnut biscotti low-fat latte and sea salt pretzel caramel ice cream – this is the new face of whats trending in private label.\"
But for many other retailers, ingredient and flavor differentiation represents a huge untapped opportunity, contends Erica Reiner, vice president, strategic business development for David Michael & Co.
\"Retailers need to determine their target consumer and communicate the objective to their private label suppliers and flavor companies,\" she says. \"The private label suppliers and flavor companies can work together to translate this objective into the flavors and products that appeal to the intended consumer.\"
Heed consumer trends
Speaking of target consumers, the under-30 generation, in particular, is seeking out \"different and spicier flavor combinations,\" reports Cheryl Borders, manager, soy foods applications, technical service edible beans for Decatur, Ill.-based ADM Research.
\"Some product categories such as snacks are starting to offer different flavor profiles for different generations, as well as regional and ethnic flavor profiles,\" she notes. \"People are snacking more frequently during the day, and they want a variety of flavor choices to make sure snacks do not become boring.\"
Innovative ingredients also could help retailers target specific demographics with meaningful label claims, sugar reductions and more, explains Evan Hyman, private label business development manager for Ingredion Inc., Westchester, Ill., by helping to preserve taste and texture preferences.
\"Front-of-pack claims disrupt shoppers, especially when they are targeted to specific demographics such as moms shopping for better-for-you cereals and snacks for her family,\" he adds.
A number of todays consumers also want their foods and beverages to contain recognizable ingredients. Thats one reason many food and beverage manufacturers have returned to using pure and natural flavors, notes Beth Bitzegaio, sales manager for Nielsen-Massey Vanillas, a Waukegan, Ill.-based supplier of pure vanilla, pure organic vanilla and other pure flavor extracts.
\"Theres more and more concern on the part of the consumer that whats in their food products [are] words they can read and understand,\" she says.
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But retailers should tread carefully on the path to uniqueness. For the most part, products still need to remain familiar and approachable, says John Harper Crandall, vice president of sales for Johns Creek, Ga.-based Amelia Bay, a supplier of liquid tea and coffee extracts and more.
\"Flavors are great additions to sweetened and unsweetened tea, but one must keep in mind [that] simple sweetened black tea is the number-one seller far and above any other type of tea or flavored tea in the United States,\" he notes. \"You have to have a solid foundation before you can get people to go out on a limb and try new things.\"
Before going the differentiation route via flavors and ingredients, retailers also should ask their store brand suppliers about existing relationships with specific ingredient and flavor companies, Borders says.
\"The retailers should specify what consumer group(s) they would like to target,\" she explains, \"and any nutritional targets should be determined at the start of the development process.\"
A collaborative effort
As Crandall notes, Amelia Bay helps its customers \"get the foundation right\" so they are able to build on that foundation with trend-based and even seasonal line extensions.
\"We extract, blend and formulate custom products right here in the USA for all of our customers,\" he adds. \"We make the tea; we make the flavors – no need for middlemen here.\"
And for retailers that want to note \"brewed\" on their tea labels, Amelia Bay offers brewed liquid tea extracts as an alternative to instant tea powders, Crandall adds.
When the product supplier sources flavors and ingredients from outside vendors, however, retailers could work hand-in-hand with both that supplier and the ingredient or flavor company to help ensure success here – and even to specify specific ingredients. Borders notes that ADM is able to offer ingredient suggestions for specific applications and also can develop prototypes to initiate discussion and starting formulations. The company offers \"an extensive line of food ingredients\" ranging from soy proteins to soluble corn powder that can help retailers differentiate within the store brand arena.
ADMs application specialists could provide technical support, nutritional information and sensory evaluation, she adds, either at the customers facility or at ADMs research center. The research center includes an extrusion pilot plant, a bake lab and a culinary center.
Ingredion, too, offers a wide range of ingredients – from nutritional ingredients and nutritive/non-nutritive sweeteners to specialty texturizers, Hyman says. He says the company boasts capabilities in food and nutrition science, texture, sensory, Culinology, trial runs, regulatory information and customer service to support retailers and manufacturers from product development to the retail shelf.
Hyman notes that many retailers approach product development based on the R&D capabilities of their product suppliers, which vary greatly. Too often, the product development function turns into a sourcing function – and the suppliers might not develop products that meet the retailers specific needs.
\"Where Ingredion can and does play a key role is in the upfront development of a formulation and translating that to the plant level,\" he says. \"With our collaborative product development, we can develop the actual formulation for the products using commercial ingredients and then work with our technical service teams to translate that to the plant level.\"
Virginia Dare, a flavor and extract company headquartered in Brooklyn, N.Y., also can work with retailers and their product suppliers from concept to finished product, says Paulette Kerner Haber, director of marketing communications and research. The process begins with an ideation session with the companys product development and marketing teams.
\"We pride ourselves [on] staying ahead of the trends,\" she notes. \"Our technical and marketing staffs are creative and innovative. Our market research staff spends time in the field with individuals, panels and groups. They use a comprehensive database to gather secondary research.\"
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David Michael, too, brings to the product development process a \"wealth of knowledge\" in regard to trends, flavor preferences and new products, Reiner says. She calls innovation the \"cornerstone of David Michaels business,\" and notes that the company even publishes a bi-monthly newsletter, Fast TrackFast Trends, to share the most interesting new products from around the world, along with insights as to \"why these products stick.\" And David Michael will celebrate the 10th anniversary of its Innovation Roadshow this year, where clients from around the world join the company to learn about trends on the horizon, taste foods and beverages the companys creative team developed and more.
Reiner stresses that the flavor company should be involved in the product development process as early as possible.
\"With an understanding of what is happening in the flavor world and the retailers existing products and brand identity, the flavor house can propose new products, line extensions and new tastes that broaden the retailers private label position,\" she explains.
And on the pure vanilla extract side, Nielsen-Massey can draw from more than 100 years of experience to assist retailers and suppliers with product development for both private label vanilla offerings and private label product offerings containing the companys pure vanilla or other flavor extracts, Bitzegaio says. (Nielsen-Massey offers vanillas from Madagascar, Tahiti and Mexico; custom vanilla blends; pure lemon, pure peppermint and other pure flavor extracts; and even rosewater and orange blossom water.) It understands how to match the flavor to the application and recently doubled the size of its plant.
\"In our plant, we not only have a lab for analysis, but we have two full working kitchens,\" she adds. \"One is a demonstration kitchen; the other is really a working kitchen with ice cream machines, with large ovens, so we can work there with people, or we can produce products there and communicate with [customers] long distance about our results and formulations.\"
Look to whats new
Retailers that stay on top of new developments within the flavor and ingredient arena could tap into the new offerings early on – creating a potential competitive advantage. And they certainly wont find a shortage from which to choose.
Among the latest offerings from ADM, Border says, are the Clarisoy isolated soy protein range, the only line of transparent soy proteins for use in low-pH beverage applications such as transparent nutritional beverages with increased protein; VegeFull cooked dehydrated bean powders and grits, which contain significantly greater amounts of protein and fiber than typical cereal grains and flours and are suitable for use in extruded/sheeted snacks, dips, crackers, baked goods and gluten-free products; Fibersol-2 soluble corn fiber, a low-viscosity, neutral-flavor, low-sweetness ingredient that can be used to increase total soluble fiber in products; and Harvest Pearl white whole-grain sorghum flour, which can impart a unique texture, flavor profile or nutritional benefits to multigrain, whole-grain and gluten-free products.
Retailers that stay on top of new developments within the flavor and ingredient arena could tap into the new offerings early on – creating a potential competitive advantage.
On Ingredions part, Hyman points to the companys broad Nutrition Worth Eating portfolio of unique nutrition ingredients, which includes a \"wide array of fibers and a calcified mineral matrix\" to help retailers develop on-trend products that have clinically proven bone, glycemic, digestive and immune health benefits. He also notes that the company is at the forefront of the trend toward clean label and non-genetically modified offerings.
\"We have over 15 years of experience in helping manufacturers create successful clean label products and offer a broad range of ingredients for the formulation of clean label foods and beverages that appeal to consumers,\" Hyman says.
And as of May 1, in addition to being USDA and QAI certified, all of Nielsen-Masseys organic flavor extracts also will be certified fair trade. In fact, the company will be the first to offer Madagascar Bourbon fair trade organic vanilla extracts, Bitzegaio notes.
\"Whats out there now are all products from India, and we are believers in Madagascar Bourbon bean as kind of the gold standard in the industry, so were very excited to have that available,\" she says. \"That will be available on the industrial side, as well as the retail and foodservice side.\"