Managing editor, Marina Mayer, discusses the latest snacking trends with Jeff Caswell, director of marketing for Chicago-based Quaker Snack Bars.
It’s all part of the annual process that we do for our upcoming 2009 State of the Industry report.
During the past two months, the editors at Snack Food & Wholesale Bakery magazine have contacted dozens of experts in the industry.
Unfortunately, we once again gathered too much information that won’t make it into our print edition. Good thing we have www.snackandbakery.com, where we can publish the “uncut” versions of our interviews.
Check out what Caswell has to say about the company, its new products and the overall state of the snack industry.
SF&WB: What are the emerging consumer trends in the bar category and how are they driving sales?
Jeff Caswell: Quaker is continuing to meet the needs of the growing number of health-conscious consumers by focusing on the nutritious goodness of the power of our products made with whole-grain oats, including our granola bars. We’re focused on the presence of positives versus the absence of negatives with the introduction of new products like Quaker Fiber & Omega-3 granola bars.
SF&WB: How are you meeting those trends with new products introduced over the last few months? Please describe new products, including the month introduced, varieties, benefits (i.e., gluten free, contains Omega-3).
Caswell: New Quaker Fiber & Omega-3 Chewy Oat Granola Bars uniquely couple two sought-after nutrients in a great tasting snack option. This chewy granola bar delivers 35% of the daily value of fiber and 320 mg. of ALA Omega-3 from flax, making it an excellent source of both nutrients. By including adequate dietary fiber as part of your daily diet, you can help keep your digestive system on track. Introduced in January ’09, these bars come in two different flavors: Peanut Butter Chocolate and Dark Chocolate Chunk.
SF&WB: What are your top-selling products and how have they changed from two or three years ago?
Caswell: Our top-selling products continue to be our Quaker Chewy Granola Bars, which deliver the wholesome goodness of whole grain Quaker Oats along with the delicious flavor that families have loved for decades. Plus, our nutrition-based sublines, such as 25% less sugar and 90 calories, are perfect for meeting the various health needs of individual family members.
SF&WB: Have you redesigned your packaging? If so, how and why?
Caswell: Our new packaging marks the first time the cohesive portfolio of Quaker breakfast and snack products is leveraged under one umbrella – with one look and feel – versus a single brand approach.
SF&WB: How are you merchandising/promoting your products?
Caswell: Our goal is to reach consumers when they are in the decision-making mindset. To that point, we are prioritizing in-store communication, where we can communicate relevant messages such as our value proposition or product improvements.
In addition, downloadable coupons and online samples are available on our Web site, Quakeroats.com. We also leverage coupon sites like Coupons Inc and Smartsource to supplement our Web site coupon activity. We monitor our consumers’ online behavior so that we can continuously optimize our programs and offer consumers what they are looking for. The Internet has a favorable impact on Quaker’s relationships with both retailers and consumers. As a critical communication vehicle, it facilitates stronger partnerships, higher engagement and authentic conversations.
SF&WB: Where are the greatest opportunities for growth in your category?
Caswell: As consumers continue to look for convenient options that fit into their busy lifestyles, there is a clear opportunity to expand distribution in convenience and drug stores. In the past, these channels have focused on less wholesome offerings, but snack bars can offer both taste and wholesomeness in a single snack. Additionally, in this value-driven economy, value channels such as club stores, are critical to growing the category.
Quaker has continued to connect with our customers’ blogger engagement, activity on Twitter and Facebook and partnership with social media Web sites such as FoodBuzz. We feel this is an area where we can set ourselves apart from our competitors by interacting with our customers on an authentic and real-time platform. Through these interactions we’ve been able to demonstrate our commitment to our consumers’ communities, talk about the issues that matter most to them and hear their immediate feedback.
SF&WB: What are the biggest challenges facing companies that compete in your category? Why?
Caswell: The biggest challenge is differentiation in a category that is crowded with innovation. It must be a difference that is meaningful and relevant to the changing consumer lifestyle. Quaker continues to provide great-tasting new products for the boomer, mom and proactive wellness-seeking target audiences – the person who is dedicated to health and well being as a way of life.
Our new marketing and advertising campaign with the theme “Go humans go” helps differentiate Quaker as a trusted brand. It features the iconic Quaker man and celebrates the whole grain oat – a super grain. It’s a key ingredient that helps power the bodies and minds of humans inspiring them to be their best.
SF&WB: What are the biggest challenges that your customers face and how are you helping them solve those issues?
Caswell: Our customers’ biggest issue is delivering value to their consumers while simultaneously maintaining their margins. We are working with them to develop creative and alternative ways of delivering value, whether it be two free bars in a carton or coupons on the back panel to drive purchases in other categories.
SF&WB: Have your brands branched out with new “hybrid” products that compete in other categories? For example, introducing a pretzel or whole grain crisp to compete in the salted snack arena. Or developing a cookie product that competes in the snack bar category.
Caswell: We believe there is a clear opportunity for strong brands such as Quaker to extend across categories, and we are in the process of evaluating opportunities to do this.
SF&WB: What is the economic outlook for the bar industry and the economy in general? Would you rather have the commodity crisis of last year or the recession that we are in now? Why?
Caswell: Snack bars, like all other industries, has been impacted by the economy. We’re optimistic that the situation will improve. In the meantime, our goal, as always, is to ensure we are bringing the highest quality products to market at a price point that’s accessible to our consumers. We are constantly looking for opportunities to increase efficiency on the production side without compromising this product quality. The commodity crisis and the recession each bring unique challenges, but ultimately both force us to become more nimble on all fronts - marketing, supply chain, etc.
SF&WB: How have you streamlined or expanded your operation to meet the demand for your products?
Caswell: Yes, we are always looking for ways to increase productivity and flexibility at the plants. With the growth of non-grocery channels, such as club stores and convenience stores, our supply chain must create a range of pack sizes, from the very large to the single serve. The demand today comes from many, many channels and meeting the needs of these various channels is one of the challenges we face that wasn’t nearly as much of an issue 10 years ago.
This year’s theme for the 2009 State of the Industry is superheroes. That said…
SF&WB: What are the biggest forces of good and evil impacting the industry, and why?
Caswell: The economy is a double-edged sword for the snack bar industry. Of course consumers are forced to cut back, but they are also looking to treat themselves in small ways. Our category sees the benefit of this – for instance, one of our new products, Quaker True Delights Chewy Granola Bars, is a wholesome yet premium snack made with whole nuts, luscious fruits and rich dark chocolate. Relative to eating out, for instance, this is a small indulgence but it could certainly brighten a consumer’s day!
SF&WB: What does it take to be a superhero in your category, and why?
Caswell: Consumer insights, consumer insights, consumer insights. It all starts and ends with the consumer – we can never lose sight of that.
SF&WB: What types of trends are “saving the day” in the industry?
Caswell: We have seen tremendous growth in snack bars that deliver telegraphic health benefits, such as fiber. These “benefit-driven” products play an important role in consumers’ lives and are thus more insulated from the economic realities.