Food Service Specialties: Snacks can scoop up sales with co-branded dips
Sales of core US snacks were up 2.8% in 2013 but sales volume declined by 0.8%, according to IRI data.
Mike R. Jacobson, vice president of operations at dip maker Food Service Specialties, said a co-branded dip could boost sales and volumes for any chip maker.
“If you don’t have a dip, you’re missing an opportunity that helps sell your products,” he told BakeryandSnacks.com at Snaxpo 2014 in Dallas, Texas, earlier this month.
“What we’ve seen is a plus-one kind of arrangement. You won’t sell as many dips as you do chips, but if you sell one dip for every four or five bag of chips, it will help,” he said.
Food Service Specialties worked to develop a variety of dips for the snack sector, from dairy-based, tomato or sour cream to spiced or peppered variants at an economy-tier or gourmet level.
Snack makers can brand these dips to match their snack product, Jacobson said, which appealed to brand-loyal consumers.
Dip trends of the future
Dips were of particular interest to companies making plain snacks, he said. “If you already have a heavily seasoned or flavored chip, you’re not normally going to double-dip.”
Asked what the dip flavor trends for 2014 would be, he said that dips would move into more artisan and gourmet territory with different peppers, spices and ethnic influences – a trend that mirrored snack seasoning trends.
He added that non-GMO would also drive the dip market over the course of the year. “The number-one thing we’re taking away from this show is the demand for non-genetically modified products.”
PepsiCo reaps dip-chip rewards
PepsiCo held the top three brand positions in the global snack market with Lay’s, Doritos and Cheetos in 2013, according to Euromonitor International data. Ruffles, Tostitos and Walkers also featured in the global top 10.
Ildiko Szalai, senior company analyst at Euromonitor, previously told this site that PepsiCo was very unique in terms of scale, finances and marketing muscle but added that it had innovated well.
One example she gave was the infamous chip and dip tie-up for its Doritos brand. “Consumers rarely buy Doritos without a dip,” she said. Leveraging into an adjacent category like the dip market, she said, had put the company in good stead.
Frito-Lay’s Tostitos Cantina Tortilla Chips – launched last year with a co-branded dip – were also recently ranked the fourth largest consumer packaged good product in the US in IRI’s Produce Pacesetters report.