Cool Snacks Heat Up Sales in the Refrigerated Aisle

Snacking is no longer a habit—it’s a lifestyle. A category that was once driven by needless naughty noshing is rapidly evolving into a sophisticated satiating staple as consumers’ views on snacking continue to broaden and the lines between meal occasions continue to blur.

With increasingly on-the-go daily routines, consumers are opting for convenient, hearty snacks not only to curb cravings between meals but also to replace a meal altogether. Consumers are more likely now than in 2016 to replace one or two meals a day with snacks, according to Technomic’s 2018 Snacking Occasion Consumer Trend Report, which found that 80% of consumers say they snack at least once a day. Plus, 37% of consumers say any food can be a snack if the portion size is small, per the report.

As such, convenient individually packaged snacks such as meats, cheeses and yogurts are on the rise, leaving opportunity for retailers to draw time-strapped, health-seeking consumers to their refrigerated cases and snacking destinations.

Functional Ingredients

Annual household spending on individually packaged snacks has increased 1.1% over the past year, according to Nielsen, with 98% of U.S. households purchasing these items at least once annually. While convenience is certainly a factor in this upward tick, consumers’ health-forward lifestyles are also driving sales in the refrigerated snacks category, with dairy snacks alone accounting for 22% of individual snacking dollars, per Nielsen data.

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“One of our most popular refrigerated snack items is yogurt,” says Melissa Davis-Hood, frozen category manager at Natural Grocers, based in Lakewood, Colo. “Our customers are seeking out good fats and proteins and are adding yogurt, especially Greek yogurt and those with low-sugar counts, to their grocery carts for a quick snack.”

Although total yogurt unit sales declined 8% during the first quarter of 2018, according to Nielsen, Icelandic yogurt and nondairy varieties serve as some of the most rapidly growing refrigerated snack categories across the store perimeter. “Yogurts are a perfect microcosm of the shifting consumer preferences in snacking,” says Jordan Rost, VP of consumer insights for Nielsen. “As more consumers are scrutinizing what is and is not in their products and from where they originate, consumers are shopping their needs, not categories. The future of snacking will be about micro trends as much as macro shifts.”

Indeed, snacking products with prominent health claims are growing. Non-GMO items experienced an 18.2% rise in dollar sales for each of the past five years, as well as snacks that are free from artificial colors and flavors (16.2%) and those with no sugar or reduced sugar claims (11.3%), per Nielsen data.  

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“We’ve seen consumers continuing to put an emphasis on having functional ingredients in snacks while placing a strong interest in finding healthier options that include fruits and vegetables,” says Priscila Stanton, VP of marketing for Ready Pac Foods Inc., based in Irwindale, Calif. The company caters to consumers’ healthy snacking lifestyles with its Ready Snax line, featuring portable cups and packs such as its new Hummus Snacker paired with fresh mini carrots. “Refrigerated snacks offer convenient, healthier options for consumers. Players that understand this shift and can offer healthier, convenient snacks will win in the snacking space,” Stanton says.

Wholesome Indulgences

Even traditionally “sinful” snacks are seeing a rise in sales due to manufacturers reinventing their products to feature more nutritious ingredients and health claims. “Snacks that were once indulgent are becoming healthy again,” says Rost. “While more consumers are more focused on healthier snacks, sales of indulgent snacks topped $100 billion last year, up 1.6% from the year prior. But even these treats are getting healthier via clean-label offerings.”

In addition to health claims, the growth of indulgent snacks can be attributed to consumers’ broadened views on snacking and blurred lines between meal occasions. “The biggest snacking trend we see is a blurring of traditional usage occasions,” says Bob Levi, CEO of Bedford Park, Ill.-based Raymundos Food Group. The company produces ethnically inspired refrigerated desserts, yogurt and yogurt-based beverages, including its new Pudding Toppers, featuring a variety of pudding flavors and crumbled pairings such as brownie pieces and granola.

“Our refrigerated dessert snacks are now far more likely to be eaten between meals than with or after a meal,” says Levi. “The morning and midafternoon times are growing consumption periods. For millennials in particular, snacking is an all-day behavior.”

Power in Protein

As consumers increasingly snack throughout the day, especially as a meal replacement, protein has become a priority to maintain satiety and energy. “Nearly all of the growth in refrigerated snacking is coming from protein combinations and snack packs,” says Collin Frantz, brand manager for Jack Link’s Cold Crafted. “This emerging subcategory is seeing over 20% year-over-year growth from these protein combinations of meat, cheese, nuts and other snack items.”

The prominent snacking brand recently introduced its Cold Crafted line of six refrigerated varieties of beef and cheese pairings, made with Wisconsin cheese and 100% beef that’s seasoned by hand and smoked, offering a protein-rich solution low in sugar, carbs and fat.

“The demand we’ve received from retailers has been incredible,” says Frantz. “We’re filling a gap that’s existed for some time in the refrigerated category by delivering a great-tasting meat-based protein snack that doesn’t force consumers to make a trade-off of protein for high sugar or high carbohydrates.”

Flavors Flourish

While the prominence of protein is clear within the refrigerated snack category, it’s become an expected attribute in most products, and consumers now want more. “People understand the value and benefit of protein. Now, it’s all about pairing that protein with other nutritive offerings and great flavors,” says Ann Pataky, associate brand manager for Kraft Heinz’s P3/OM Adult Snacking. “The ‘mini meal’ is experiencing exciting growth. Year over year, we’re seeing lots of innovation as we try to meet this consumer demand for a healthy, balanced way to satisfy cravings outside of the traditional main-meal eating patterns.”

Kraft Heinz recently launched P3 Protein & Fiber Plates, a multicompartment snack containing meat, cheese, nuts and crunchy granola clusters, offering a variety of flavors and textures as well as a great source of protein and fiber.

As shoppers become more adventurous with their snacking and flavor interests, retailers must continue to carry products that go beyond traditional expectations. “There seems to be less of a distinction between wholesome and flavorful snacks,” says Kareen Stephens, brand manager for Schuman Cheese. “Consumers don’t feel as strong of a need to choose between one or the other, nor do they have to with the variety of products that is now available.”

With countless selections of refrigerated snacking products on offer, retailers must create designated snacking destinations in-store to guide shoppers through their snack purchases. “The biggest issue we see today is consumer confusion over where to find these products,” says Frantz. Depending on the type of product, snack items can be merchandised in the deli department, dairy case or meat section. Retailers can create refrigerated snacking destinations to make it easier for consumers to find the products they seek.