The chips market has grown highly diversified over the past several years. In 2017, a chip can run the gamut, including standard potato chips, chips made out of fruits or vegetables, and multigrain options. And while a handful of traditional brands continue to dominate sales, others continue to offer new and unique flavors that build consumer interest.


Market data

According to data from IRI, Chicago, for the 52 weeks ending April 16, 2017, dollar sales of potato chips were up slightly, by 1.68 percent, to $7.4 billion.

Frito-Lay remains far and away the top performer in the category, at $4.4 billion and a gain of 1.56 percent. Its top two brands both saw gains, with Lay’s up 0.21 percent to $2.2 billion and Ruffles up a nice 12.84 percent to $844.1 million.

At No. 2 in chips is Kellogg Co., up 0.85 percent to $810 million, primarily based on sales of its Pringles brand, which was up 0.05 percent to $716.5 million.

In addition to traditional Ruffles, other potato chip brands showing strong gains include the Ruffles Sabritas brand (up 23.35 percent to $56.9 million), Uncle Ray’s (up by 16 percent), Lays Sabritas (up by 10.66 percent), Ruffles (up by 12.84 percent), and Cape Cod (up by 
9.93 percent).

Private label chips earned almost $511 million dollars over the past year, and increased by 5.93 percent in profits.

In the “other salted snacks (no nuts)” segment within salty snacks, home to multigrain chips like Frito-Lay’s Sunchips, dollar sales rose 4.45 percent to $4.0 billion.

The apple chips category, filed under “miscellaneous snacks,” has performed well over the past few years. That trend continued over the past year, with the segment up 6.19 percent, with profits to the tune of $21.8 million. Pine Creek is the top-performing brand in the category, coming in at $9.9 million with a 36.86 percent in profits. Seneca Foods follows closely behind, with a profit of $8.9 million, but a dip of 14.2 percent in dollar sales, per IRI.


Looking back

Many chips are naturally gluten-free, and because of this, chips have found a niche with consumers who eat gluten-free, either by personal preference or by necessity.

“Per Mintel, gluten-free foods have appeal beyond the original gluten-intolerant consumer base and are continuing to become a mainstream trending category, with gluten-free snack sales growing 56 percent from 2014–2016,” says Shawn Sweeney, CEO, Primizie Snacks, Austin, TX. “30 percent of millennials say they choose gluten-free foods not because they are intolerant, but because they feel they are more natural and provide more energy.”

In March 2017, Primizie Snacks released a new, gluten-free line of its Crispbreads, made with organic sprouted grains and three types of nutrient-rich flours (brown rice, teff and millet). The line is available in three flavors: Ancient Grains, Smoked Cheddar, and Green Harvest.

The lines dividing some snack categories have blurred in recent months and years. Another example of concept migration is the new Ritz Crisp & Thins from Nabisco. The baked chips feature potato and wheat flour.

In the past year, more chip manufacturers have been highlighting use of different types of oils, including avocado, coconut, rice bran and high-oleic canola.

In April 2016, Kettle Brand, from Snyder’s-Lance, released its Avocado Oil chips in flavors like Chili Lime, Himalayan Salt and Hawaiian Barbeque. Dollar sales of Kettle Chips were up 6.08 percent for the year to $201.4 million. Other new flavors from Kettle Brand include Korean Barbeque and Moscow Mule.

Earlier this year, Boulder Canyon released Mesquite Barbecue Coconut Oil potato chips and Rice Bran Oil Kettle Cooked potato chips, available in flavors like Teriyaki Ginger and Roasted Jalapeño.

“A growing trend impacting flavor is the use of healthier frying oils, including avocado, oil and coconut oil chips, to create a ‘cleaner’ chip,” explains Kim Breshears, marketing director, Potatoes USA, Denver.

Consumers are looking for snack options that provide a “health halo,” too. “A lot of snack manufacturers have started looking at different types of cooking oils to diversify their product range and meet growing consumer demand for healthier alternatives,” says Mark Lozano, sales manager, North America, tna, Sydney, Australia. “From canola, sunflower and olive oil, to coconut and corn oil, there are a lot of options available to manufacturers.”

“High-oleic oils—such as Omega-9 canola oil, sunflower and safflower oil—have a clean, neutral flavor profile that allows the flavor of the chips to shine through,” says Mary LaGuardia, Omega-9 Oils marketing manager, Dow AgroSciences, Indianapolis.

The modern chip market is definitely not short on taste: flavors range from the sweet to the savory, and it’s all based on consumer demand for the new and inventive.

Chips made out of fruits and lesser-used root vegetables continue to grow in popularity. Hain Celestial’s TERRA brand released Plantains and Sweet Plantains chips in February 2017, made with coconut oil. The company also released a potato-based chip in May 2017 called Red White and Blues chips, which are made out of beet-dipped sweet potatoes, naturally blue potatoes, and Yukon Gold potatoes.

JicaChips also offers a line of jicama chips in flavors like Smoked BBQ, Chili Lime, Spicy Soy Ginger and Cinnamon Sugar.


Looking forward

“New flavor launches, recognizable ingredients, bold colors and spicy twists on the classics are driving the majority of consumer purchase intent,” says Judson McLester, ingredient sales manager, McIlhenny Co., Avery Island, LA.

“Consumers want bold and global flavors,” says Trip Kadey, director of culinary, French’s Foodservice, Chester, NJ. “We also see familiarity, like the flavor of Buffalo, winning in impulse snack buying.”

Lozano notes that consumers are looking for “indulgent taste experiences” in their snacks. “Whether it’s a sprinkle of salt or complex flavor blends, taste sells snacks, and the right seasoning equipment can help manufacturers gain a competitive edge when experimenting with new flavors or product formations.”

Sprouted grains, such as sprouted amaranth, quinoa and sorghum, can help snack producers align with the fast-growing better-for-you snacking trends, suggests Sweeney. By letting the grains sprout, he says, some of the starches in the seed are consumed, resulting in a high proportion of fiber and protein, which means more nutrients, easier digestion and even better flavor.

Highlighting sustainability can also help a snack stand out. “Two in five consumers make purchase decisions based on sustainability,” explains LaGuardia. “The number is even higher for millennials and Generation Z, who are rapidly becoming the largest purchasing generations, and who snack at rates nearly two times that of baby boomers.”

And chips made with healthier oils will continue to expand, says LaGuardia. “Formulating snack foods with oils that have a healthier profile—for consumers and the environment—deliver the healthier options consumers crave, while still providing the functionality and performance that producers require.”