Snack sales are on the rise in 2023, and retailers hold a strong outlook for the category going forward as brands introduce continued innovation that keeps customers coming back for more.
The salty, sweet and better-for-you snack segments are seeing strong dollar sales growth, partly driven by price increases in the category.
For salty snacks, pretzels led with a 17.5% increase in dollar sales and a 1.1% uptick in unit sales for the 52 weeks ending April 29, according to NielsenIQ. On the sweet snacks front, cookies dominated with a 28.3% bump in dollar sales and a 4.7% increase in unit sales, despite a price-per-unit increase of 22.5% for the same period. As far as healthy snacks go, multigrain snacks saw a 21.8% increase in dollar sales and 2.5% growth in unit sales for that same period per NielsenIQ.
“I am seeing the most growth within salty and alternative snacks. When it comes to flavors, I am seeing customers go for more spicy, sweet and savory snacks,” said Meghann Eaton, category manager at Nouria Energy, which operates 170 c-stores in Maine, New Hampshire, Massachusetts and Rhode Island.
Eaton noted that customers are also gravitating toward brands that use clean ingredients.
Inflation’s Impact on Snacks
Inflation has been driving food prices higher, and snacks are no exception. Even though dollar sales have increased, unit sales have decreased due to inflation.
For example, cupcake unit sales declined by 10.5%, while meat snack unit sales dropped by 9.9% for the 52 weeks ending April 29, noted NielsenIQ.
“Unit sales have flattened in both sweet and salty snacks due to the continuing increase in costs and the needed increases in retail to maintain margins,” said Mike Jackson, category manager at High’s, which has 60 stores throughout Maryland, Delaware and Pennsylvania. “Some categories, such as meat snacks, have seen a significantly higher increase in costs, so we have seen a decline in unit purchases for meat snacks.”
Inflation has caused some challenges for Nouria as well.
“One of our biggest challenges is how quickly costs are rising,” said Eaton. “With these high food costs, we are just trying to make sure customers feel good about shopping with us.”
Variety Drives Snack Sales
As c-store customers purchase snacks, they’re seeking variety and healthy options.
Circana’s “The Snacking Supernova” report found 48% of consumers look for multi/variety packs because they offer more snacking options.
“Customers are looking for variety in snacking options while still expecting to see those staple brands available,” said Jackson. “There seems also to be an increasing demand for value-priced items in the snacking category. Something that offers a price value to the customer even though it may be a smaller-sized package.”
The Circana report also found 54% of consumers say snacks are an important part of their healthy eating plan throughout the day.
“Consumers want better-for-you items but are still buying unhealthy items as well. They need the healthy options to still have full, rich flavors,” said Eaton. “Also, with costs climbing, they still want deals to feel like they are saving.”
Both Nouria and High’s are looking at trends closely to make sure they have the right snacks on their shelves.
Eaton mentioned that Nouria is offering keto-friendly chips, Planters cheese balls with cleaner ingredients and its private-label pastries.
“We try to offer the top-selling sweet snacks while still offering some healthier choices for the customers seeking out those types of products,” added Jackson. “We are also keeping a closer eye on planograms and making sure items that are not selling well receive placement more often.”
As retailers continue to stay on top of all the latest snack trends and keep their most popular snacks on shelves, they will continue to see snack sales grow despite inflation.
“We think if the category is managed properly, we could see a modest increase in dollar sales of about 10%,” said Jackson. “Unit sales are also expected to be slightly up or even flat towards the end of 2023.”