Fries, pickles and munchies for the cannabis crowd: Conagra expands into new snacking segments
According to Thomas M. McGough, co-chief operating officer and executive VP of ConAgra, the company is targeting the fries, pork rinds and pickle segments, each ‘big category segments that are growing at a very robust rate’.
Fries (potato chips) is a $377m category growing 8% over the past year, the $539m pork rinds segment grew 16% and shelf-stable and refrigerated pickles is a $1.1bn category, growing 6% over the past year, Gough told attendees at the company’s investor day earlier this month.
Flying high
“Everybody loves fries, and we’re going to attack this three ways,” said McGough.
Slim Jim – a leader in the fast growing meat snacks sector – is rolling out Slim Jim Fire Fries, which are “big, bold, spicy with the iconic Slim Jim snap.”
Bigs, Conagra’s sunflower seeds brand, is also launching a fries product in Nacho Cheese and Ranch flavors.
The Chicago-based company is stepping into the legalized recreational marijuana space and will be a special ‘fully baked hot munchies’ version of its popular Andy Capp’s snacks on April 20.
McGough noted the brand is perfectly poised to capitalize on the current cannabis boom – 10 states have already legalized it, with more expected to follow.
He added Andy Capp’s is “growing like a weed.”
Slim Jim’s big flavors are making their way into the company’s Slim Jim Fried Pork Rinds in two new variants: Squealin’ Hot and Hog Wild Barbecue.
“They’re a perfect snack; they’re high in protein, low in carbs,” said McGough.
Permissable indulgences
McGough told investors that brands need to evolve out of their legacy formats in order to grow.
For example, boxed cake mix brand Duncan Hines will be launching on-the-go single-serve cake cups packaged with toppings such as Oreo cookie pieces or unicorn-themed cookies and pudding.
The company’s Davids seed brand is also branching out with a new format.
“We recognize that not everybody eats shell-on sunflower seeds, so we’ve created new forms.
David energy-packed clusters combine seeds are ‘better-for-you’ poppable snacks with 6g protein.
“These brands [David and Bigs] – when reframed as protein-based or plant-based snacks – opens up a massive $13 billion category,” said McGough.
Conagra is also playing with new formats to capture the pickle snack sector.
“Eating pickles out of a conventional jar is inconvenient and messy, and pickle snacks are actually becoming a thing, particularly in c-stores. So we’ve created Vlasic single-serve pickle slices and also a Vlasic vacuum-fried pickle chips that taste absolutely fantastic.
“Many of our snacking brands were treated as center-of-the-store commodities, and they were locked in their legacy format, and that was particularly true of Snack Pack, Swiss Miss and Duncan Hines," added McGough.
“But when you reframe these three brands as sweet treats, you open up a massive demand space.”
Healthy snack growth
According to IRI data (POS, MULO+C) for the 52 weeks ending February 24, 2019, Conagra is now one of the world’s Top 10 snacking companies.
The $14.3bn packaged foods company posted a healthy 8.2% sales growth for its snacks portfolio. led by Orville Redenbacher's, Act II, Snack Pack, Slim Jim and Duke’s.
“As much as we’ve done, we are just getting started,” said McGough.
“Our categories are supported by strong underlying consumer trends, namely all things protein, plant-based nutrition and what we call ‘permissible indulgence.’”
