Spice Up Your Dips and Spreads

No holiday gathering would be complete without a selection of tasty dips. But increasingly, consumers are looking to keep dips on hand for any occasion.

“Dips, integral to party fare, are making their way into the ‘anytime is snack time’ trend,” says a recently published category insight report on dips and spreads from Geneva, Ill.-based FONA International.

The same goes for spreads. According to “Sweet & Savory Spreads,” a May category insight report from global market research firm Mintel, sales of nut-based and sweet spreads, for instance, are expected to increase 65 percent between 2013 and 2018 to reach $65 billion, with the growth reliant on a number of factors, including increased snacking occasions.

And store brand products appear to be selling well in the dips and spreads category. According to data from Chicago-based Information Resources Inc., most store brand dips and spreads subcategories realized both dollar and unit sales gains during the 52 weeks ending Sept. 8. See the chart, p. 176.

Focus on flavors

So what must retailers do to make their own-brand dips and spreads stand out from the competition’s? One way is to develop flavors that stand out.

Consumers are becoming increasingly disinterested in the same old dips and spreads. Yet choosing not to branch out could be a problem for retailers, according to Aimee Tsakirellis, director of marketing at Ward Hill, Mass.-based Cedar’s Mediterranean Foods Inc. Flavor and product repetition could hurt sales of store brand dips and spreads.

Try offering “unique, funky and different flavor profiles to create some differentiation from the mainstream brands,” she recommends.

For retailers not sure which unique flavors could be a win, open communication with suppliers should be a priority. Ask suppliers for key category insights and advice on trending flavors and products, Tsakirellis advises.

What’s hot in dips

On the dips side, what flavors and ingredients currently are trending? Greek yogurt, according to FONA, with 10 percent of all dips launched in 2013 being yogurt-based. With more Americans wanting better-for-you options, high-protein hummus and other bean-based dips also could excite shoppers.

Ethnic flavors and ingredients such as peppers and unique spices are a hit right now, too, according to Bridget Sherman, director of new product development, and Lela Adelman, account manager for custom brands at Urbana, Ohio-based Robert Rothschild Farm.

Additionally, indulgent “whole meal” style dips such as Archer Farms Loaded Baked Potato Dip could catch shopper’s eyes — as could unique flavor combinations. FONA cited a number of unique flavors launched in the dips and spreads space, including Berry & Jalapeño Pepper, Buffalo Sauce Hummus and Caramel & Chili Pepper.

Spreads get nutty, flavorful

As for spreads, peanut butter will always be a staple with retailers’ store brands. However, other varieties of nut and seed butters are becoming mainstream, including almond, cashew, hazelnut, soy nut, flaxseed, sunflower seed and chia seed butters. And those allergic to peanuts aren’t the only ones purchasing these butters.

“Almost half of consumers we surveyed were agreeing that these types of spreads are suitable not just for those with nut allergies, but everyone else too,” says Amanda Topper, food analyst at Mintel, adding that consumer packaged goods (CPG) companies are starting to roll out some of these alternative butters, which once were found in only health food stores.

Indulgent spreads — inspired by Ferrero’s Nutella spread, which Mintel called an “industry game-changer” — also are invading the nut butters section of the aisle, with Mintel stating that one in five consumers wants to see more indulgent nut-based spread varieties such as raspberry white chocolate or chocolate chip. One CPG company that recently introduced products fitting this trend is J.M. Smucker Co., Orrville, Ohio, which launched a line of hazelnut spreads under the Jif brand that includes flavors such as salted caramel and mocha cappuccino.

Flavors also matter in fruit spreads, where retailers could offer out-of-the-ordinary store brand products to stand out.

“Consumers are really interested in new flavors, not just your standard strawberry or blueberry, but also more interesting ones,” Topper says, adding that consumers have a growing interest in ethnic flavors and varieties— including spicy ones such as jalapeño or habanero jelly.

With preserves in particular, Sherman and Adelman point to mature flavors such as orange elderflower, tart cherry and tea or alcohol inclusions; regional or varietal ingredients such as Maine blueberry or Black Mission fig; and the use of exotic or heirloom fruits as trending areas. Store brands also could stand out via unexpected flavors such as rose, basil, bacon, ginger and vanilla bean.

Retailers also should make sure that a selection of their store brand jams, jellies and preserves appeals to the health-conscious shopper.

“We are seeing a move to better-for-you products … sweetened with sugar and not high-fructose corn syrup,” says Mike Post, director of sales at Portland, Ore.-based Trailblazer Foods, adding that top claims for the preserves category include “less added sugar,” “organic” and “more fruit.”

And don’t forget about the demand for high-end products with clean ingredient decks. Millennials, in particular, aren’t afraid to pay a little more money for products with more flavor and fewer ingredients, Post says.

Sherman and Adelman add that local ingredients and small-batch manufacturing also are ways to appeal to those seeking premium-quality products.

Pitch your products properly

But no matter how on-trend a product is, shoppers won’t buy if they don’t notice it. Therefore, Tsakirellis recommends promotions such as a free store brand dip with the purchase of a bag of store brand chips.

Retailers also need to make sure pricing stays competitive — even with premium products, Tsakirellis says.

“Consumers are definitely shifting to more value per dollar, so going all-natural or more premium for a cheaper price point than the top brands is key as well,” she explains.

And don’t forget about placement; cross-merchandising — such as placing spreads next to prepared foods or preserves next to scones in the bakery — could give added exposure to store brand spreads. Of course, also make sure products are easy to spot in the aisle.

“One of the most effective merchandising tactics is making sure the product is visible,” Post says. “And there’s no better way to do that than to put the private brand at eye level so the consumer sees it first.”

Do consider offering nut and seed butters beyond peanut butter under your own brands.

Don’t be afraid to branch out from the same old dips and spreads.

Do consider secondary placement of spreads with prepared foods and in the bakery.

Don’t ignore the trend of incorporating Greek yogurt in store brand dips.