Key Note Media Centre
Savoury Snack Market Up While the Economy is Down
According to Snack Foods 2012, a new Market Report Plus published by the market intelligence provider Key Note, the savoury snack industry in the UK is profiting from the economic downturn. The market experienced 7.1% growth in 2011 to reach a value of £2.71bn at retail selling prices (rsp). Key Note attributes this success to the strong popularity of snacks in the UK, to the growth of adult lunchboxes, and to manufacturers tapping in to the bag-sharing category and responding to consumer demand for healthy snacks and innovative flavours.
Potato crisps continue to dominate the savoury snack market. Traditional crisps remain the best sellers, but there has been a rise in variation in the sector on two levels. First, manufacturers have responded to health concerns by altering the content of their snacks and their methods of production so that they are less fatty and more natural. This has increased the presence of less salty crisps and baked -- rather than fried -- crisps on retail shelves. Second, there has been a growing demand for creative flavours, both with British and exotic origins. Manufacturers are increasingly appealing to consumers to suggest or design their own flavours and are perpetually introducing new ones, some only on a temporary basis to coincide with holidays and events.
Although potato crisps dominate the market, the other savoury snacks sector is on the rise. In 2011, the sector experienced a 7.8% growth in value, attributable to the mounting demand for healthy snacks. Key Note argues that popcorn and pretzels are the two to watch in this category. The demand for snack nuts is also growing, due to the health benefits associated with them. However, their higher price tag compared to most other savoury snacks, especially during the economic crisis, means that the category's growth will be limited, unless manufacturers lower prices.
The snacks market is experiencing format innovation at the two extremes. 2011 has seen a growth in both multi-packs and sharing bags, which Key Note expects will continue well into 2012. The former is the result of the rise in popularity of adult lunchboxes, which now account for 70.8% of all lunchbox meals, according to Kantar statistics from February 2012. This trend is particularly favourable for premium brands, as professionals, who are saving money by bringing their lunch to work, still want a quality lunch. As for the latter, with the UK facing its biggest spending squeeze since 1982, consumers are increasingly opting for a 'nights in' filled with home entertainment; nibbles, thus snacks, enhance this experience. The adult lunchbox and the 'night-in' niches have been created by the economic downturn, as consumers find ways to save money. The snack industry is in a prime position to reap the benefits from this otherwise unfortunate circumstance.
Manufacturers are in intense competition with each other and luring consumers through campaigns, innovation and promotions. Key Note's analysis in this Snack Foods report brings light to the high demand for savoury snacks in the UK and consumers' desire to explore and play with new flavours. Key Note expects continued strong market growth in 2012, at 7.5%. Events, particularly the London 2012 Olympics, will help to boost volume sales, as well as continued flavour and packaging innovation. Based on the current conditions, Key Note predicts the market will hit £3.13bn by 2016.
Press enquiries: Jack Sykes at Key Note at email@example.com or 0845 504 0452. Press/review copies of the report are available on request.