Just as the industry thought it was entering a period of normalisation, following COVID-related declines, supply chain disruptions, and the aftermaths of the cost-of-living crisis, geopolitical pressures and market uncertainty are seemingly the certain things, moving forward. For consumers, this means snacking habits will be tested and manufacturers will need to be more precise, flexible, and aligned with their needs.
Keeping the consumer in mind
Consumers are still highly concerned about prices and affording their living costs. They are making different choices, balancing nutrition with price, and intentionally seeking information to make better choices that align with their perception of value or worth the spend.
In 2024, 28% of consumers globally said they try to save money on food
Source: Euromonitor Voice of the Consumer: Health and Nutrition Survey, fielded January to February 2024 (n=40,236)
Despite the persistent financial challenges consumers are facing, they are still looking for and willing to pay for premium features. This presents a conundrum for the industry in providing products with enhanced quality that are still priced attainably (“quality affordables”).
Considering the vast number of consumers and their differing perceptions of value, manufacturers have significant opportunities to grow. Catering to consumer value demands can be rooted in traditional values, like health, sustainability, sensationalism, or multiculturalism, or new-age ones like convenience offered by the growth of e-commerce (including social commerce and digital sales growth). Value-based innovations and pricing allows for a more symbiotic relationship for the consumer, brand, and planet while also achieving the quality affordable appeal that will become the expectation.
Expanding beyond boundaries
Over the years, brand expansion strategies have been a greater focus for manufacturers – building the presence of their highest-selling brands in existing and new categories while unlocking growth among new markets, channels, and consumers. Some of the leading snack manufacturers like PepsiCo, Mars, and Hershey’s have publicised efforts to expand further in developing and emerging regions where sales velocities are fastest (2-percentage-point higher forecast period CAGR than developed markets).
Critical objectives of brand expansions include assuring an optimal portfolio mix that fulfils consumer demands and enables marketing to build brand value, and the ultimate creation of a more future-proofed product suite. Mergers and acquisitions alongside industry collaborations and cobranded partnerships have been increasing to support these means. And all players are taking a closer look at costs, price structures, and packaging formats to ensure accessibility is still intact for consumers. Looking at product launch activity from Euromonitor’s Innovation Tracker, it is clear that marketing efforts have been increasingly focused on broadening established brand equity, particularly through retail channel reach, rather than launching completely new product lines and/or brands.
Maximising the potential of existing resources remains vital for snack futures, but the adoption of new technologies and capabilities is also what helps to position the category as the delighter it is. Several brands have carved out their own space in snacking with unique firsts and consumer value-based growth frontiers.
For example, Oobli relaunched and rebranded its low-sugar, sweet protein milk chocolate bars in 2024. Oobli is known for its sweet protein (brazzein) formulations derived from a West African berry it uses to sweeten the bars. The company gained the attention of major ingredient supplier Ingredion for its ability to support consumer and industry sugar intake reduction efforts.
With growing ambitions to ensure channel strategies meet the Channel Conscious Shopper Shifts trend, Taco Bell launched chicken nuggets coated with tortilla chips, rivalling foodservice competition, but also tapping into the growing space for snacks away from home, as ingredients, and as meal replacers in new ways.
Campbell's Co launched new Pop'ums pretzel snack in the US under its Snack Factory brand. Mimicking popcorn with a crunchy coating and lighter inside, it appeals to consumers seeking savoury snack product types that also meet their textural, sensory demands.
Lead with responsible value-anchored decisions
As the snacks market is expected to remain turbulent in the foreseeable future, long-term brand success and value generation will require responsible marketing efforts, a higher degree of flexibility, and consumer-centric strategies.
Learn more about value conscious snacking in our report, Value Conscious Snacks to Address Evolving Consumer Demands, to understand more about consumers’ evolving snacking needs and key considerations to deliver.