Beefing Up Snack Sales

The prevalence of meat snacks has grown a great deal in recent years as the market has expanded with innovative flavors and new varieties.

By Howard Riell, Associate Editor.

The meat snacks category, which many Americans consider all but synonymous with convenience stores, continues to build sales as well as prestige. New and exotic flavors are hitting shelves all the time and health claims are helping make them more socially acceptable to a larger share of the American population—an evolving audience that increasingly includes women and youngsters.

No one doubts that the category is a c-store staple. According to Nielsen’s Convenience Store ScanTrack data, sales of meat snacks totaled nearly $885 million for the 52-week period ended June 11, 2011, a 6.8% increase. Unit volumes rose by 4%. The Jack Link’s brand, with 23 of the top 24 jerky items and flavors as varied as Teriyaki, Smoked, Peppered, Sweet & Hot, Cheese, BBQ and Mild, dominates the category, Nielsen reported. That said, ConAgra’s Slim Jim leads the meat stick segment with nearly $48 million in c-store sales for the same period.
Overall, jerky remains the largest portion of the business, with 39% of sales ($347 million) and 3.9% year-to-year growth. Traditional sticks notched just over $286 million in sales, on sales growth of 12.3%. Only the nuggets/tenders products saw a sales decline (3.10%).

Hunger satisfaction steers considerable snack selection as 68% of consumers who purchase meat snacks do so for that reason. According to a Snack Food Association (SFA) Panel Report, sales dollars of dried meat snacks increased by a healthy 9.7% last year, with volume up 12.2%. Jerky’s dollar and volume sales were up 5.7% and 8.7%, respectively.

Changing Landscape
Christopher Clark, vice president of operations for the Snack Food Association in Arlington, Va., said that the snack food segment in general has seen a spate of new and innovative flavors over the last several years. This is true in meat snacks, as well. “There have been some garlic and other hotter, spicier flavors introduced, so I think the variety is driving sales.”

In the past, Clark noted, meat snacks, jerky and other sorts of meat snacks were more prevalent in the Western U.S. “Now the category is growing nationally with a strong following in Eastern U.S. markets,” he said.

In the same respect pork rinds, which traditionally may have been more of a Southeastern snack food, have been growing more in the West. “So I think you’re seeing some expansion with respect to both products, which is an indication that there are new opportunities for retailers across the country,” Clark said.

There has also been growth in the private-label business, with brands such as Old Wisconsin, Oberto, Bridgford Foods and others seeing strong sales.

Another shift, Clark said, is that more and more snack food in general seems to be getting sold in nontraditional retail outlets.
“Drug stores, dollar stores and even alternative formats like Home Depot have been selling a lot more meat snacks,” Clark said. “I wouldn’t be surprised if you saw pretty good increases in some of these nontraditional outlets over the next few years.”

While the focus of meat snack companies has traditionally been on male customers, there has been a sharp increase in sales among female consumers.

“We do well with this category across all demographics, and have seen double-digit growth the past couple years,” said Tim Cote, vice president of marketing for Plaid Pantries Inc. in Beaverton, Ore. “Margins are under pressure at retail as more and more companies understand the category’s growth potential, and therefore promotional activity has increased on bagged product.”

Cote, who oversees 104 Plaid Pantry stores, admitted he found it interesting how brands based in his part of the country have maintained so much of the market share. “Oberto and Old Trapper are key players in our sets, along with national players such as ConAgra (Slim Jim) and Trails Best (Monogram).”

Strong Variety
As with so many other product categories, consumers want new items to try despite being fiercely loyal to their favorite brands and products, and manufacturers aren’t disappointing them. Chris Switzer, category manager for Susser Holdings Corp., the Corpus Christi, Texas-based operator of more than 500 Stripes stores across three states, said he is seeing some innovation among the new products entering the category, mainly in the stick segment.

“I know that ConAgra has the new Slim Jim DARE, and we’ve added some super-premium bagged lines that have been new to our customers and done pretty well,” Switzer said.

It was earlier this year that ConAgra Foods extended its Slim Jim DARE meat stick line with the launch of three new flavors: Kinda Hot Chili Pepper, Freakin’ Hot Jalapeño and Really Freakin’ Hot Habanero. While the flavors marked a departure for the meat stick segment, the spicier flavors, spicier names and even spicier packaging are what consumers are demanding. An attractive price is equally important. The DARE line retails for $1.39.

Switzer agreed that the image of the meat snacks category has not only changed, but improved. “I think most Americans probably view it now as a healthy snack alternative. There is a move toward lower-calorie, lower-fat snacks overall that have fewer carbs and a lot more protein in them—less of the bad sugars and sweeteners typically found in salty or sweet snacks.”

Healthy and Natural
While some manufacturers are promoting the healthy aspects of their products, others wonder whether such positioning will help or hinder sales.

“There are a couple of companies that are pushing all-natural ingredients and the healthful benefits of low-fat snacks, which is good,” Switzer said. “But we have to be careful that we don’t go too far to reach the female demographic that we end up alienating the male segment at convenience stores. Operators know that their core customer for meat snacks is definitely a male customer the majority of the time, so screaming ‘good for you’ may not sell as much as talking about the taste and the quality.”

The flip side is that the demographic for meat snacks is changing, albeit slowly—not only becoming less blue collar, but shifting to include more women, teens and young adults.

While variety is key, out of stocks has been a problem lately due to some supply issues from products produced in South America, Switzer said.
Stripes has been using the shortages as an opportunity to push its private label line, Smokin’ Barrel Beef Jerky, to the fore. The result has been growth and added exposure for a line that boasts a larger profit margin than some national snack brands.

Stripes’ management’s plans for its eight-linear-feet in-store set have not changed, Switzer reported. The chain will continue to add regional suppliers on a store-by-store basis in order to provide some variety. “But as far as our typical store set, we have no plans to change it.”
For the months ahead, Switzer said he expects to see solid growth. “Now that everybody is back in stock, we’re seeing the category growing in the high single digits.”

  • Jerkyninja

    Very good article.. great read and solid info 

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