Sales continue to be driven by brand trust, with this loyalty forming the basis for exploiting current trends.
According to exclusive NEMS consumer research, commissioned by Key Note in June 2014, 69.5% of respondents stated that brand trust was a driving factor in the regular purchase of snack food, with the three most popular brands being:
This favours conglomerates, such as PepsiCo (Walkers/Doritos) and Kellogg’s (Pringles), with brand power increasing the likelihood of a return on investment into new product developments.
Market-leading manufactures are able to reinforce this advantage with aggressive pricing strategies, in-store promotions and high expenditure on marketing initiatives, with these schemes contributing to enhanced brand awareness.
NPD is of prime importance in this market given the high level of product saturation. There is a high demand for healthier snacks and exciting new flavours, which is maintaining volume sales in the potatoes crisps sector and unlocking potential growth with regard to snack nuts and other savoury snacks.
In the same NEMS research that was conducted in June 2014, it was revealed that 54.4% of respondents were driven by the desire to regularly purchase healthier snack foods, while 54.4% were also influenced by the desire to try a new product. As such, manufacturers of all sizes have attempted to exploit these demands. Tyrrells for instance, recently introduced a new range of vegetable crisps, while Burts launched a new spicy chorizo flavour of potato crisp, with the aim of tapping into the growing desire for spicy variants in the UK.
Yet, these brands, although increasingly popular, remain less established than those of the market leaders. This is a substantial disadvantage considering the overriding importance of brand trust in this market. As such, both Walkers’ recent launch of Pops, a healthier form of potato crisp, and Kettle’s launch of vegetable crisps, are likely to outsell their smaller rivals.
The popularity of savoury snacks in the UK ensures that new trends regularly emerge, providing manufacturers with new avenues for growth in an extremely competitive marketplace. When combined with the highly established level of brand awareness and loyalty, there are strong foundations for further growth among the established brands operating in this market. However, heavy investment is required to fully exploit these opportunities and this is likely to lead to ongoing market consolidation, as manufacturers of all sizes are forced to accept slimmer margins.
Despite this, consumer interest in snacking between meals is yet to peak, with convenient food solutions becoming increasingly popular among a busy consumer base.
Key Note forecasts impress five-year growth of 21.2% between 2014 and 2018.
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