Retailers are predicting that the upward trend in salad-dressing sales will escalate this summer -- the season when raw greens become even more appealing to health-conscious consumers.
Although salad dressing is a mature category, a multitude of new flavors has recently revived interest in it and has helped fuel sales of more traditional flavors and brands as well.
"The new vinaigrettes, Parmesan cheese, garlic, basil or balsamic vinegar dressings are the ones driving the market, and I am sure other new flavors will come out," said Ross Nixon, vice president of merchandising for Dahl's Food Markets in Des Moines, Iowa. "Name-brand dressings are getting into these flavors now, too."
Salad dressings have had "reasonably good growth because they are tapping into the trend for healthy eating," said Paul Crnkovich, a partner at Cannondale Associates Inc., sales and marketing consultants in Evanston, Ill.
"Dressing makers have been able to take a lot of the fat out and keep the taste in, and mainstream companies are pumping out the exotic flavors. The category is driven by the new products. You continually have new ones coming in and old ones being taken out," he said.
"Best Foods brought out a new line, and their spending on advertising and promotion fueled growth of other brands," he added. The dominance of the big name brands is maintained across most of the country, according to Crnkovich, with small and private-label brands experiencing moderate success in some areas of the country or in their particular niche of the market.
According to Charles Jones, senior buyer at Scolari's Food & Drug, Sparks, Nev., only 10% to 15% of "the new exotic flavors" are successful. "We can get 30 new flavors in a six-month period, particularly around this time of year, and most don't last, but they stimulate sales," Jones said.
Shawn Buckner, category manager for Plumb's, Muskegon, Mich., expressed a similar sentiment. "We call it 'flavor of the week,' " said Buckner. "Flavors come on the market and go off the market, but then people go back to the basics. Hellmann's has new vinaigrettes, and Kraft's new line has done well. Ken's Steak House has a lot of new lines."
The shelf-stable, pourable salad-dressing category grew a healthy 5.3% in 1998, according to Information Resources Inc., Chicago. Sales totaled $1.3 billion for the 52-week period that ended Jan. 3, 1999, according to IRI. But some individual brands far outstripped the category as a whole.
Kraft led the list of top brands, with $268 million in sales and a 14% increase over last year. Wishbone was No. 2, at $210 million (an increase of 15%); while Hidden Valley Ranch flavor was No. 3, with $144 million in sales. This was less than a percentage point increase over the previous year.
Sales for refrigerated salad dressings were also up, increasing 8% for roughly the same period (ended Jan. 31, 1999). Of the refrigerated dressings, Marie's Lite and Luscious recorded the biggest sales jump, a 22% increase, just ahead of Litehouse dressing, which showed a 21% jump in sales.
Almost all retailers SN spoke with said they promote salad dressings heavily in the summer, with demos, coupons and cross merchandising. But Brookshire Grocery Co. also promotes the category during the first quarter of the year, when people are trying to live up to their New Year's resolutions to lose weight, and during holiday periods, said Sam Anderson, director of public relations. Brookshire is headquartered in Tyler, Texas.
"Shelf-stable is up 11% over last year, [while] refrigerated is fairly flat," Anderson said. Promotions are keyed to the holidays and peak sales periods, with more product samples and coupons used during heavy promotions, he said.
Retailers often cross merchandise salad dressing in the produce aisle to generate additional sales.
"The amount of floor space for produce in some stores recently has grown dramatically. In some new layouts, produce is front and center. This channels people through produce before they get to the rest of the store," Cannondale's Crnkovich said. In these stores, salad displays often stock dressings and salad add-ons to create "one-stop shopping."
George Tsokolas, director of fresh foods and food service for Senn-Delaney, a unit of Arthur Andersen, Chicago, noted that a "salad solution center" will typically feature one item and build a display around it.
"Croutons are an excellent tie-in to the salad-dressing category and are displayed with salad dressings or put on an aisle stack in front of the category," Tsokolas said. "Other products include salad-dressing mixes, coleslaw mixes, bacon bits and general merchandise clip-stripped to displays and shelves."
Dahl's, Plumb's and Save Mart Supermarkets, Modesto, Calif., all use a combination of cross merchandising and solution selling to push the salad-dressing category.
"On occasion, we do an exciting display with mushrooms and tomatoes with the various types of lettuce and then tie in croutons and dressings," explained Nixon of Dahl's Food Markets.
Plumb's uses coupons and advertised sales to promote dressings, particularly during spring and summer. Promotions emphasize the weight-control aspect of salads, said Jay Maddern, director of grocery, frozen food and dairy.
"Small, mobile racks that can be placed in produce also seem to work well combined with promotional features," he said.
Prepackaged salad greens and other ready-to-eat ingredients sold in produce have been especially helpful in boosting sales of all the related products, Save Mart's Anderson said. "The introduction of the prepackaged salads has made this a convenient way to have a salad ready in minutes," he noted, and cross merchandising Center Store dressings in produce is an effective way to let people buy everything they need in one place.
"People want to try something new or get something that is good for them, but this is a fast-paced life a lot of times. Having everything together in a display lets people get in and out," said Nixon.
Doug P. Keller, director of grocery and liquor for Save Mart, said his stores promote salad dressings on a regular basis, with coupons and endcap displays. "We display some shelf-stable dressings in the produce department, but mostly we devote 16 feet to 24 feet of shelf space to dressings, depending on the size of the store," he said. "If we see sales exceeding [expectations], we look at the space devoted to the category, to determine if it should be increased."
While big brands dominate the salad-dressing category, smaller company and store brands have made some headway. For example, Scolari's has a line of Hy-Top dressings, but it is mostly French and Ranch flavors that are marketed successfully under the private label, Jones said.