Our 2013 State of the Industry report on snacks focuses on new snack products, the perspective of snack manufacturers and product leaders and market sales. 


New shapes, bold flavors and clever packaging, as well as a twist on healthy ingredients, are the air mattress keeping chips afloat this year. Snack manufacturers
are giving consumers a crunch in various chip formats, not just the potato version.

Snack chips ahoy! It’s summer and time for outdoor parties, graduations, weddings and many other special events…even for poolside snacking. In fact, snacking is taking on a life of its own these days, as it is substituting for meals, can be done on the run and can be enjoyed in places where full meals can’t, like on a raft in a lake.

Snack Food & Wholesale Bakery has uncovered all sorts of trends in chips this year, potato and otherwise. The category is still quite strong in terms of sales volume, with sales in the 52 weeks ending April 21 totaling more than $6.7 billion, according to Information Resources, Inc. (IRI).

The Hartman Group (no relation) has been tracking many evolutions in the consumer food culture for more than 20 years. Their eating behavior continues to change in relationship to lifestyle shifts dictated by various factors, such as work and family demands, commuting, social interaction and holidays, to name a few. Given these factors, traditional views of mealtime have gone off the deep end, and the perception is blurring the boundaries between “snack” and “meal.” Thus, consumers want their snacks to be healthier, often more substantial, tastier and satisfying without being too much of an indulgence.

Snacking as a whole continues to increase, as people hunt for convenient, on-the-go meal alternatives to traditional sit-down meals, and snack options are spread throughout the day. So snack marketers and manufacturers are creating all sorts of new products to meet these needs.

“The hot trends now include nonGenetically Modified Organisms (nonGMO) verified and gluten-free-certified products,” says Roya Rohani-Cuetara, vice president of marketing at San Francisco-based Classic Foods. “On the ingredient side, ancient grains, beans, vegetables and chia have become very popular. Additionally, an increasing demand for popped items has been driving sales in the snack category. In the recent past, it was organic and nontrans-fat products, but we have noticed a very clear shift. In response to this, about two years ago, we became a gluten- and nut-free facility and are weeks away from becoming gluten-free-certified. We are also currently working on getting nonGMO-Project-verified.”

In September 2012, Classic Foods launched its one-of-a-kind, crispy, popped tortilla chip brand called Poptillas. These light snacks deliver bold flavor with up to 25% less fat because they are popped instead of fried. Made without cholesterol, preservatives, high fructose corn syrup, trans-fat, monosodium glutamate, artificial flavors or colors, Poptillas popped tortilla chips are not just tasty, they’re a smart move, according to Classic Foods. They’re made with whole grains and come in three flavors: Yellow Corn Original; cheesy Nacho Cheese with a hint of spice; and Salsa Verde, which is spicy, zesty and tangy.

Classic Foods also recently launched The Risi Papas Caseras family of brands in four flavors that bring together the heartland of Mexico’s cuisine using a variety of mouth-watering indigenous chilies from Mexico. Risi Kettle Chips are golden potato chips that are slow cooked for a satisfying crunch and seasoned with habanero, serrano and adobadas chilies. These combinations of sweet, tangy, zesty and fiery deliver bold and savory tastes.

Healthy is key

Snacks often get blamed for the obesity epidemic and people’s unhealthy lifestyles. Snack manufacturers, however, are countering by encouraging the industry to do a better job of educating American consumers that making lifestyle changes, adding or continuing exercise, controlling their portions and moderating their routines to promote a more active lifestyle are keys to preventing obesity.

“Consumers are focusing on healthier snacks,” Rohani-Cuetara adds. “There has been a significant increase in sales and demand for snack foods in the past few quarters, a change we attribute to an improving economy. Organic will always be an important sales force, but the drive is moving toward nonGMO and gluten-free, which is what we are focusing on. We will continue to manufacture conventional items as long as our clients demand them. But the trend now is all about popped items. Competition is definitely increasing in that segment, but so is our motivation to continue to excel in this product category.”

Faith Atwood, marketing manager for Cape Cod Potato Chips, Charlotte, N.C., says artisanal products continue to gain popularity. “People yearn for food that has been prepared the old-fashioned way,” she says. “Cape Cod’s method of cooking chips in small batches and in custom kettles positions us well for consumers seeking out these types of products. All of our Cape Cod varieties are gluten-free, which positions the brand as a desirable snack option for those consumers that choose to restrict or limit gluten in their diets.”

Atwood also says that consumers are seeking out more better-for-you snack options with a variety of flavors from which to choose. “This year, we have added to our reduced-fat line of chips with the launch of 40% Less Fat Sea Salt & Cracked Pepper,” she explains. “We have also added Farm Stand Ranch Waffle Cut to our product lineup, which is a lower fat chip compared to leading brands.”

Consumers are definitely becoming more adventurous with flavor exploration and are looking for more sophisticated combinations, Atwood says. “They’re using Smart Phones to shop, make their grocery lists, look up ingredients/nutritional information and seek out the products they are looking for,” she adds.

Cape Cod’s reduced-fat Sea Salt & Cracker Pepper chip flavor is made from a blend of sea salt and peppercorns, including a premium white pepper to lend a slightly sweeter note. The Farm Stand Ranch Waffle Cut chips combine fresh flavors of celery, carrot, onion and dill with creamy buttermilk and sour cream. “We expect this trend in flavor exploration will continue,” Atwood adds. “The potato chip category is extremely competitive, which means differentiation is one of the biggest category challenges. We’re focused on giving consumers a reason to try Cape Cod potato chips. We know that once they experience the full flavor and wonderful distinctive crunch delivered by our small-batch kettle chips they will continue to buy our product. Our greatest opportunities for growth are converting flat chip consumers to kettle-cooked chips, increasing distribution and expanding our 40% less-fat line.”

Exotics float onto the scene

Some of the other emerging movements swimming into the chip lane include Middle Eastern and Mediterranean influences. “The greatest opportunity is the expansion of a more culturally diverse United States,” affirms Rohani-Cuetara. “People are seeking snacks that have a cultural identity, nostalgia, and most importantly, health and authentic ethnic flavors.”

Case in point: Flamous Brands Inc., Pasadena, Calif., is launching two new offerings to its current healthy snack/chip line. One is a 1.6-oz. individual serving size of Spicy Falafel Chip, a bite-sized and travel-friendly package that complements Flamous Brands’ signature Original Falafel chips. The second new item, available this summer, is the company’s latest variety of Sprouted Multigrain Zatar chips, available in 1.2- and 7-oz bag sizes.

Inspired by an authentic East Mediterranean blend of spices, herbs, vegetables and beans, the chips are loaded with functional proteins, such as organic garbanzo, fava beans and black beans, and contain numerous sprouted micronutrient grains said to be beneficial to overall health, including brown rice, buckwheat and brown flax. According to the company, the chips also are gluten-free, contain no GMOs and are certified 100% organic by the U.S. Department of Agriculture (USDA).

“At Flamous, we are committed to providing high-quality, nutrient-based, tasty goodness,” explains Sam Shehayeb, CEO and founder of Flamous Brands. “Zatar truly provides a mouth-watering eating experience that will satisfy everyone’s tastebuds, to keep you feeling great about your choice of snacks. The products are produced in a 100% dedicated, Gluten-Free Certification Organization (GFCO)-certified gluten-free facility that eliminates the risk of cross-contamination.”

“The hottest trends are a combination of both the ethnic influence and ‘better-for-you’ options,” agrees Luke Mapp, director of marketing, at Mikesell’s Snack Food Co., Dayton, Ohio. “There is also a lot of experimenting going on with different forms of root vegetables and different grains and vegetables like kale.

“In the past, we were limited to mainstream American ingredients, like potatoes and corn, while seasonings were targeted strictly around taste and not about health. Taste is still the number-one factor for purchase intent, but now, we are finding ways to make foods that taste good and also deliver healthier benefits. This was much more difficult in the past.”

The bolder, the better

Today, snack producers can’t come up with a flavor that’s too wild. With Frito-Lay’s recent “Do Us a Flavor” contest that asked the public to vote for either Lay’s new Sriracha, Chicken & Waffles or Cheesy Garlic Bread chip flavors, nothing is out of bounds. The contest winner, by the way, is Cheesy Garlic Bread, which will be available through the year. The company is bringing back the Sriracha and Chicken & Waffles chips to store shelves this summer for an encore appearance.

Regionally-inspired recipes have also invaded Frito-Lay’s Lay’s potato chip lineup, in everything from Cajun Herb & Spice and Honey Mustard to Tangy Carolina BBQ, Chipotle Ranch and Balsamic Sweet Onion. Though some of the new flavors are available across the U.S., others are only currently distributed in select regions.

And when it comes to Ruffles, grab a life preserver. The company’s new Ruffles Ultimate in Kickin’ Jalapeno Ranch, Sweet & Smokin’ BBQ and Original have deeper, heartier ridges that it says are hardcore for hardcore dips. The ridges are twice the size and depth of those of original Ruffles.

Elsewhere in the Ruffles lineup, there’s even a Tapatio hot-sauce-flavored chip aimed at those want to add a real kick to their snacking. “Since first entering the market four decades ago, Tapatio hot sauce has become a must-have for consumers looking to add authentic Mexican flavor to meals and snacks,” says Dorothy Jones, senior director, innovation, at Frito-Lay North America, Plano, Texas. “We’re so excited to now bring that exceptional flavor—a perfect blend of heat and smokiness—to some of our most popular Frito-Lay brands and satisfy consumers eager for hotter, spicier foods.”

The flavor of beer-battered onion rings is also on tap with Ruffles MAX Beer-Battered Onion Ring potato chips. “Guys live for those moments when they’re hanging out together at a bar, diner or tailgate party, trading epic stories and munching on their favorite snacks,” says Tony Matta, vice president of marketing for Frito-Lay. The snack was available for a limited time during the spring break season, nationwide, in 2.5- and 8-oz. bags.

Meanwhile, new takes on barbecue are continuing to surface. SunChips fans can now crunch into a unique spin on barbecue SunChips Sweet & Spicy BBQ multigrain snacks. They’re sweet, with a bit of a kick, and team with the heartiness of a multigrain chip. The sweet flavors mimic molasses and include brown sugar and honey blended with hints of spicy chipotle for balance. The rich flavor complements lunch, especially when paired with a sandwich, Frito-Lay states. Each 1-oz. serving of SunChips Sweet & Spicy BBQ snacks (about 15 chips) has 140 calories and contains 18 g. of whole grains. (The recommended consumption of whole grains is at least 48 g. per day.)

“Our fans have told us they love the taste of authentic barbecue and are always looking for unique ways to enjoy it,” says Matta. “Consumers have come to expect that whole grains and great taste naturally come together in SunChips snacks. Sweet & Spicy BBQ SunChips are just what they’ve been waiting for.”

Also known for its unique flavor combinations, like Rosemary & Olive Oil, Aged Cheddar Horseradish and Spicy Dill Pickle, Deep River Snacks, Old Lyme, Conn., debuted a line extension of a crinkle-cut Sour Cream & Onion kettle chip earlier this year. While this flavor is pretty common in potato chip snack circles, there’s nothing ordinary about this new kettle chip. The company says it perfected the flavor to hold in the chips’ ridges, which gives eaters an extraordinary flavor, explains company founder and CEO Jim Goldberg.

“We know that Sour Cream Onion is a popular flavor with other chip companies, but we wouldn’t launch this flavor until we were certain that our Sour Cream & Onion chip would stand apart from the competition,” Goldberg says. “We believe it will quickly become one of our top-selling flavors. The chips are initially available in a 2-oz. grab-and-go bag.”

More on flavor trends

Mikesell’s produces snacks such as potato chips, popcorn, tortilla chips and puffed corn. While many changes have taken place in its 100-plus-year-old business, the company’s dedication to developing top-shelf products remains the same.

“Consumers demand variety,” says Mapp. “Snack food companies are re-evaluating their flavor profiles by being more creative with options. Buying habits continue to reflect the notion that consumers are still demanding consistent, high-quality products. There is no substitute for quality.”

This year, Mikesell’s launched Bold Jamaican Jerk and Sour Cream & Onion Kettle Cooked potato chip, the latter of which was brought back to market based on consumer requests. “Fans begged us to bring back this old favorite flavor, so we complied,” Mapp explains. “This time, it’s in our Kettle Cooked potato chips, which have a dash of sour cream and the taste of a fresh-sliced onion.” Available since February, the flavor joins Bold Jamaican Jerk, which has a bit of a sweet, spicy Caribbean edge.

“Flavor trends appear to continue moving toward ethnic inspirations such as Asian, Hispanic and Mediterranean,” Mapp adds. “In Mikesell’s case, this includes flavor profiles that match specific tastes from those regions. We’ve introduced two ethnic-inspired flavors with Reduced Fat Tuscan Spice (in 2012) and Bold Jamaican Jerk (this year); both are flavors our customers have responded to very well.”

Expanding to natural-foods and gourmet distributors, Mikesell’s also promoted its new products via Facebook and Twitter social media platforms. The company also partnered with a local newspaper to run a reader contest and appeared on local morning TV programs to speak about the new flavors and how the snack industry is evolving. “We are focusing heavily on the better-for-you products category, which is more of a lifestyle choice for consumers,” Mapp says.

New packaging graphics rolled out last year, creating increased appetite appeal and premium positioning, while reflecting the brand’s equity. Enviromentally-friendly before it was mainstream to be “green,” Mikesell’s recycles approximately 130,000 shipping cases each year and donates potato by-product to local farmers. It also recovered starch, which it sells back to paper mills for the development of paper products.

At Utz Quality Foods Inc., Hanover, Pa., new chip flavors take on a New Orleans vibe with Zapp’s 1.5- and 5-oz. Sweet Creole Onion and New Orleans Kettle Style Voodoo Heat. Utz has also come up with a Voodoo Potato Stix product under the Zapp’s brand and launched a Sweet Potato rippled kettle chip under its own brand name in a 7-oz. bag.

Some shade from the heat

Yet sometimes less is more. “We found inspiration for our Farm Stand Ranch Waffle Cut chips in the fresh, fragrant vegetables and herbs of local farm stands,” says Atwood. “To impact the future, we would like to see the industry continue to move toward providing high-quality snacks, made from simple ingredients—snacks that families can feel good about eating.”

Herr’s Foods, Nottingham, Pa., recently launched Good Natured Selects, made from a blend of oats, potato flour and a combination of poppy, flax, sesame and caraway seeds, blended to create a nutty flavor that can satisfy even robust appetites. Herr’s says the multigrain crisps contain no saturated fats or artificial ingredients and are completely gluten-free.

Available since April in Original Grains with Sea Salt, Artisan Cheddar Cheese, which is naturally colored with beta carotene, or Tuscan Garden Medley, which blends carrots, onion and celery and a touch of roasted garlic, tomato and bell pepper, the three flavors come in 1-, 2.3- and 8-oz. bags that retail for 35 cents to $3.99.

Sticking to the crunch

Snack sticks are also coming back into the sun, and Springfield, Mo.-based French’s Flavor Ingredients, a division of Reckitt Benckiser, is unveiling French’s Potato Sticks. In fact, French’s is taking the flavor of Frank’s (as in hot sauce) from hot dogs and hot wings to chips, pretzels and nuts this year. And there’s no dipping required; the iconic brands have been transformed into free-flowing dehydrated versions great for seasoning snacks. The dehydrated versions allow manufacturers to take the full flavor of the finished liquid sauce to applications that traditionally were off limits.

The potato sticks are made with the dry version of Frank’s RedHot Cayenne Pepper Sauce for plenty of zesty flavor. The product will be packed in 16-oz. bags and canisters and initially go to retail in the Northeast this summer and in national distribution in the fall. Industrially-sized packages will be available in 2014. Made with 100% real potatoes, the sticks are made using a special cooking process that helps them stay fresh and crisp. They have a distinctive shape, great flavor and plenty of crunch.

French’s Flavor Ingredients says it’s committed to providing savory solutions and culinary autonomy with foundation flavors and flavor enhancers by offering a full line of dry finished sauces. This includes Worcestershire Sauce, Rochester Sauce, Classic Yellow Mustard, Dijon Mustard, Original Hot Sauce and Buffalo Wing Sauce. The inherent full flavor of these dry sauces can outperform their singular spice rack counterparts like cayenne pepper and mustard flour, according to the company.

Lindsay Mathisen McDonald, a technical sales representative with French’s Foods, says that as the snack aisle continues to break flavor barriers with more gourmet and untraditional offerings, dry versions of the culinary staple ingredients help create authentic flavor experiences. “Worcestershire sauce and mustards have long been a part of the culinary repertoire, providing depth and complexity to sauces, entrees, side dishes and more,” says McDonald. Consumer demand for creative “meal-inspired” snack offerings has lead manufacturers to explore flavor creations such as chicken and waffles, loaded baked potato, enchilada and bacon, lettuce and tomato (BLT). Such complex profiles find success when the flavors are layered and balanced much like the inspiring dish. Dry Worcestershire sauce and mustards enhance seasoning blends’ sensorial impact with the true flavor and color of the original sauce.

In a category all its own, hot sauce and buffalo flavors can enchant the taste buds for various snacks. Finished dry sauces offer versatility to help formulators meet consumer demand and evolving tastes,” she explains. Buffalo, once only enjoyed on chicken wings, is now sweeping the supermarket snack aisle. Frank’s RedHot Dry powder has a fermented cayenne pepper flavor, balanced with a vinegar tang and a cayenne kick. This dry powder can stand alone or be combined with other complimentary flavors like blue cheese or blended as an enhancing flavor to a more complex seasoning blend like chilli, McDonald says.

“We at French’s believe it is a great standalone flavor and have used it dry in our new French’s Buffalo flavor potato sticks,” she adds.

Pringles Stix from Kellogg Co., Battle Creek, Mich., are also now on store shelves. Available in an eight-count box of single-serve pouches and a 70-count resealable bag, Pringles Stix come in three flavors: Honey Butter, Pizza and Cheese. They’re a playful twist on the original Pringles potato crisps, promoting spontaneous snacking, thanks to their fun, playful shape, crispy texture and great taste.

“Snacking isn’t just about satisfying your appetite for something crispy and crunchy,” says Teresa Lindsey-Houston, Pringles marketing director. “Pringles Stix are as fun to play with as they are to eat, so share them with friends, bring them to the party and don’t be afraid to play with your food.”

High-dive challenges

Several regional snack companies told us that the biggest challenges they face are competing head-on with the huge national brands, dealing with the lackluster economy and feeling the high waves from private-label brands and high commodity prices. “Our biggest challenge continues to be competitive with national brands that have larger advertising budgets,” Mapp admits. “Customers tell us our quality is better, and we pride ourselves on producing the best product for them. It’s difficult to compete on pricing with the national brands.”

Like others, Rohani-Cuetara says the biggest challenges facing companies in the chip category are logistics and costs. “Most companies in the popped snack food category have to get pellets from one company, pop them in another and package them in a third location. This process is both exhausting and expensive. We are proud to be the only fully integrated company in North America that can custom make snack pellets, pop them and package in the same location. Having upgraded our state-of-the-art R&D facilities has allowed us to deliver a one-stop shop to produce snack products from concept to consumer.”

Many snack manufacturers also say the economy forces people to switch to less expensive store brands, and commodities have been very volatile in price fluctuations over the past few years. Still they’re trying to stay afloat. The good news is that snacking is definitely on the upswing, and more exciting chip products on the scene are changing the way we all snack. 


State of the Industry Report on Snacks Overview