Spotlight on Salty Snacks
The salty snacks category is booming. According to “Category Insight: Salty Snacks, Meat Snacks and Popcorn,” a March 2014 report from global market research firm Mintel, sales have increased 28 percent since 2008, as snackers seek out products that satisfy hunger pangs wherever they are.
But with so many brands looking to get in on the action in the salty snacks category, retailers will need more than a quality product to grow store brand share. They also will need to give private brand salty snacks the merchandising support they deserve.
To see what retailers are doing well and not so well here, we visited three stores in Chicagoland: a Heinen’s Fine Foods store, operated by Cleveland-based Heinen’s Inc.; a Walmart store, operated by Walmart Stores Inc., Bentonville, Ark.; and a Target store, operated by Minneapolis-headquartered Target Corp. Our visits took place on a Monday afternoon in mid-August.
Heinen’s Fine Foods
General observations: The salty snacks in the Heinen’s Fine Foods store are located in two aisles on the right half of the store (looking into the store from the front entrance). Foot traffic was heavy in the store, but practically nonexistent in this section.
One aisle houses traditional chips (tortilla and potato), pretzels and bagged popcorn, while the other contains nuts, trail mixes, popcorn (confectionery, better-for-you and microwavable), rice cakes, gourmet pretzel sticks, party mixes and other salty snacks. The Heinen’s brand — the retailer’s only traditional private brand — represents all store brand salty snacks.
- ■ The section was extremely clean, well-stocked and organized.
- ■ The store blocks its store brand chips in one aisle and its store brand nuts and popcorn in the other aisle, effectively communicating the Heinen’s brand.
- ■ The store offers a number of natural and organic chips under its own brand.
- ■ In addition to offering them in 10-ounce containers, Heinen’s packages select varieties of nuts in 2-ounce pouches. Under the pouches were tags communicating a 12-for-$10 deal.
- ■ A shelf cross-merchandising Heinen’s brand salsa jars runs down the center of one side of the aisle containing chips, pretzels and popcorn.
- ■ On one end cap in the salty snacks section, the store cross-merchandised store brand salsa with salty snacks. In another end cap, it cross-merchandised store brand confectionery popcorn with other salty snacks.
- ■ In another end cap near the salty snacks aisles, the store placed containers of Heinen’s brand nuts (chocolate-covered and plain) with tags communicating a “Weekly Sale” discount.
- ■ We found a number of sale tags beneath many offerings of national brand chips, but we couldn’t see anything communicating value under any SKUs of Heinen’s brand chips.
General observations: The Walmart store houses its salty snacks section in the back right-hand corner of the store (looking into the store from the front entrance). Foot traffic in the section was light, with only a few people entering while we were browsing.
Almost all store brand products — chips, pretzels, jerky, nuts and more — retail under the Great Value brand, with only a handful of more-upscale SKUs (nuts and pita chips) offered under the Sam’s Choice brand.
- ■ The store is the only one of the three we visited to offer multipacks of store brand potato chips.
- ■ We found a stack of Great Value shelf-stable hummus in between bags of Stacy’s pita chips and bags of Great Value pita chips.
- ■ We also found a tray cross-merchandising salsas, quesos and other dips under the Great Value and Wild Oats brands with Great Value tortilla and potato chips.
- ■ Many of the bags of store brand chips were misplaced and poorly organized, and several were out of stock.
- ■ A number of bags of chips appeared to be crushed.
- ■ We found no tags or signs communicating the value of store brand products or sales.
General observations: The salty snacks section at the Target store is located on the right-hand side of the store toward the back (looking into the store from the front entrance). Foot traffic was light, with only a couple of people entering the section while we were browsing.
Store brands here are Archer Farms (which is currently undergoing a redesign) for premium chips (tortilla and potato), Simply Balanced for better-for-you chips (tortilla and potato) and popcorn, and Market Pantry for national-brand-equivalent jerky, popcorn (microwavable and bulk), cheese puffs, pretzels (plain and filled), nuts and more.
- ■ The section was clean and well-stocked.
- ■ The store cross-merchandised jars of Archer Farms dips in a shelf insert bearing a “Taste What’s New” strip.
- ■ We found a sign advertising the Archer Farms redesign by showing before and after shots of Archer Farms Salt & Vinegar chips with a “Your favorite chips have a new look” message.
- ■ Tags underneath bags of various Simply Balanced and Archer Farms chips and popcorn communicated a “2 for $5” deal for the products, while others underneath Archer Farms Restaurant Style Tortilla Chips communicated a “2 for $4.58” deal.
- ■ For its Market Pantry products, the store places non-bulk items next to their national brand counterparts while it merchandises bulk products — which have no stocked counterparts — in block fashion.
- ■ The store merchandises its Simply Balanced and Archer Farms products, unique in their own right, in block fashion.
- ■ The store hung bold tags communicating price cuts underneath several Market Pantry products without stocked national brand counterparts.
- ■ The store secondarily placed bags of Archer Farms Yellow Corn Restaurant Style Tortilla Chips tortilla chips with its Hispanic foods several aisles over.
- ■ In another nearby aisle, the store cross-merchandised 3.5-ounce bags of Archer Farms nuts and trail mixes on a side wing next to shelves of drink mixes.
- ■ The store didn’t price shield certain Market Pantry products when their national brand counterparts went on sale.
- ■ Many of the signs above each section of the aisle were incorrect. For example, we found a “Trail Mix” sign above the section with tortilla and potato chips.
Back ’em up
When it comes to merchandising salty snacks, it’s no longer enough to simply place a store brand product next to its national brand counterpart. Joe Papiri, vice president of sales and marketing at Snak King, City of Industry, Calif., says retailers need to create a destination within a category for own-brand products and dedicate a large amount of space on shelves for a brand to have an identity of its own. He also points to the effectiveness of off-shelf displays.
Army Nix, spokesperson for Newport Beach, Calif.-based Balance Foods, also believes in the importance of merchandising store brand salty snacks via off-shelf displays — particularly via a freestanding rack near the deli. End caps and signage also work well.
Additionally, retailers should consider setting up a store-within-a-store for private brand salty snacks and more.
“It could be a one-stop shop for consumers,” Papiri states.
Packaging also is integral in the marketing mix. Nix notes that packaging should have a cohesive design from product to product, turning an assortment of store brand salty snacks into a family of products.
But all too often, retailers aren’t willing to make the investment necessary to develop a truly eye-catching package design. This reality has to change if retailers really want to drive sales of store brand salty snacks.
“Invest in the graphic designs, and do not be afraid to try new looks,” Papiri notes. “There are some great-looking lines being developed.”
And retailers could do well by calling out the healthful attributes of their better-for-you salty snacks. According to the Mintel report, nearly two-thirds of consumers say it is very important or somewhat important that the snacks they eat are healthful, which has encouraged manufacturers to develop more healthful options. Health-conscious shoppers unaware of a better-for-you product’s healthful attributes might need more information to help them make their purchase decision.