In 2014, there were 70% more new chip product launches across Europe compared to 2010, according to Innova Market Insights’ database.
“Every year more and more products are entering the market; chip brands continue to be interested in this market and are continually trying to capture consumers. It’s an alive but also very established category because as you can see the growth is very stable,” Sjoerd Post, market analyst at Innova Market Insights, told attendees at a conference session at ISM/ProSweets Cologne 2015.
Flavor explosion: Think premium, health and detail
The top three flavors in the European chip sector in 2014 were salt, cheese and onion. However, the fastest-growing flavor was olive oil.
“This is interesting. In 2014, there were three times more products using olive oil compared to 2010 and this is of course related to how the chips are made, because olive oil is a very popular flavor in baked chips. It’s not just an added flavor, but it’s used to bake the chip too and olive oil, among all the oils, is pretty premium and high quality,” Post said.
The health image associated with olive oil was also important, he added, particularly as consumers became more conscious about the content of their food. The leading health/clean label claim used on chips for 2014, for example, was ‘no additives or preservatives’, Innova data showed.
Post said popped chip varieties and those made using vegetables or grains had also proved popular because they hit on health priorities. The number of sweet potato, carrot and beetroot chip products launched in 2014, for example, had tripled since 2010.
Companies were also turning towards more complex flavor blends, he said, and while the top five seasoning blends remained the likes of salt and vinegar, sour cream and onion and salt and pepper, manufacturers were adding a premium twist.
“What’s interesting is the specification. Just saying you have salt and pepper is not enough anymore, you want ‘sea salt and black pepper’. There are also specifications on vinegar, for example cider or balsamic.”
Companies were also adding more unusual flavors into these blends, Post said, like lime. “Lime is typically added to a soft drink or cocktail; we also see lime added to beers to make it a summer drink but apparently it’s also entering chips.” Lay’s and Kettle were among a number of big brands that had incorporated the citrus flavor into chip products last year, he said.
Craft brands beyond beer…
Over the past few years, Post said the European chip sector had also seen an influx of craft brands – start-ups with a niche product – much like what had happened to the beer market.
“If you look at these products, a lot of them will claim ‘hand-cooked’ or talk about the potato farm. ‘Thick cut’ is also very typical for these craft chips, and these craft chip brands are changing the chips category. You’ll see new alternative chips entering and they’ll be the ones trying out really bold flavors like roast beef and horseradish but also experimenting with packaging,” he said.
In general, these craft brands had a strong backstory to tell, he said, and Keogh’s, Ten Acre and Burts were good examples of this.
“Craft brands are really good at telling their own story and a lot started out for a reason – they saw a missed opportunity in the market and found their own niche or space and decided to do something differently.”
“…If you go to the website, you’ll see images like farmers growing the potatoes and this really just gives you a face to the brand and product you’re eating – it’s not a faceless corporation and there are no suits, just casual, working clothes. It’s very direct and I think consumers like this direct connection.”
Post said big players were trying to catch up or match up to this artisanal feel. “Tesco’s for example are launching hand-cooked potato chips, Lay’s is also going back to the farm – you can see the characteristics that started with craft brands move into mainstream. It makes the chips category very interesting – a lot is happening.”
Beyond the pillow bag
Post said some manufacturers had experimented with packaging variations beyond the traditional gusset pillow bags.
Lay’s in Brazil, for example, had launched a quad bag – a stand-up pouch bag that when opened could be used as a bowl. Similarly, there had been a raft of re-sealable chip packs that helped consumers with portion control and product freshness, he said.
Some tortilla chip firms had also developed microwaveable bags, he said, so consumers could have a truer taste of Mexico with warm chips to dip into sauce. “This is a great innovation about premiumizing your snack at home.”
Asked if manufacturers should prioritize packaging innovation or flavor development, he said: “The problem right now with packaging is that people are very used to pillow bags and it’s also economical. There are other solutions, but for now it’s going to be more about flavor.”
“Packaging and re-sealability will be very important for the future, but not right now,” he told BakeryandSnacks.com.