Snack sales at c-stores aren’t immune to fluctuations as COVID-19 forces customers to stay home. While some c-store retailers reported a surge in sales as shoppers raced to stock up ahead of self-quarantine measures, the numbers show the majority of those sales increases were captured by other channels — like supermarkets — where customers did bulk shopping. Still, c-store retailers, coming off a strong 2019 for snacks, are confident the foot traffic dip caused by the virus will be temporary and are positioning themselves to reap the benefits of the rebound.
In the four weeks ending March 22, 2020, research firm IRI’s convenience all-scan data found dollar sales for dried meat snacks dipped 2.3%, overall salty snacks fell 4% and snack bars/granola bars declined 12.2% at c-stores. But robust 2019 sales leading into the pandemic prove customers are snacking more across the salty, sweet and meat snack segments. That trend remains evident across IRI’s multi-outlet (MULO) data that spans food/grocery, drug, mass merchandisers, Walmart, club, dollar and Military DECA (commissaries). For example, the weeks of March 15 and March 22 each saw 60% boosts in salty snack sales over last year’s numbers, according to IRI all-scan MULO data.
In other words, the demand for snacks remains as high as ever, and opportunity exists for c-stores to recapture those sales. C-store retailers are continuing to roll out new snack options and expand their category sets to best appeal to customers as a top destination for snack sales amid the pandemic.
Salty Trends
When it comes to what salty snacks shoppers are buying at c-stores, many are sticking close to the traditional snack king: the potato chip.
“We’ve always sold a lot of chips,” said Dyson Williams, director of merchandising for Dandy Mini Marts’ 65 stores in New York and Pennsylvania.
Maybe that’s because snack lovers know Dandy will have what they like. Williams said that Dandy goes out of its way to make sure that, when that consumer is looking for a favorite chip, his stores have it.
“We actually deal with seven different chip companies,” Williams said. “We’re probably one of the only c-stores in the industry that deals with that many different chip companies because we believe in a variety, and we want to have everybody’s brand of chips if we can.”
That’s a smart move. According to IRI, U.S. c-store all scan data for the 52 weeks ending Dec. 29, 2019, potato chips showed solid dollar sales growth at 4%, contributing to a $5.88 billion salty snack category that rose a tasty 6% in 2019. The rise, though, was a team effort. Cheese snack dollar sales rose 12.2%; tortilla chips were up 9.9%; pretzels rose 5.5%; and non-tortilla corn snacks were up 3.7%.
Meaty Metrics
Meanwhile, meat snacks continue to hold strong appeal for customers. IRI’s data showed that jerky simmered through 2019 at a 2% growth rate. The category as a whole, though, rose more than double that at 4.7%, driven by consumers’ willingness to try some less traditional meat snack products. Those non-jerky snacks registered a nearly 7% dollar spend increase last year.
The segment has performed so reliably that Dandy Mini Marts is in the process of expanding its meat snacks display. Williams explained that, without the new display space, Dandy’s typical set has a three-foot endcap with beef sticks up top and other jerky bags below. The added display will improve that significantly.
“And then we have an additional four-foot section of the big bags of jerky,” he said. “We can have anywhere between the snack-size bag that you get for a couple of bucks to the huge ones that we sell for almost $20.”
Williams said that the c-store chain began the project nearly three years ago and has implemented the added space in nearly 75% of the stores. That large bag he mentioned is gaining in popularity, perhaps because buying bigger can mean saving more.
“You’re getting significantly more product; it’s not even close,” said Hit-n-Run Food Stores President Brent Mouton, with 11 stores in Louisiana. He said that one reason is the ability to seal the larger bag and graze for longer periods throughout the day.
“We’re selling a 10-ounce bag of beef jerky, you know what I mean?” he said, referring to the bag’s hefty haul. “(They) crack it open, pull a few pieces out and reseal it — and they’re good to go.”
Williams said once consumers get past the price point on the larger meat snacks bag, they realize they’re getting more for their money. “You’re going to spend 20 bucks on jerky; that’s a big spend,” he said. “It’s a better value, so the people that are purchasing a lot of jerky say, ‘I should buy the big one.’”
Sweet Snack Sensations
Sweet snacks are holding their own, too. Snack and granola bars remained fairly flat for the year, down 2.1% for 2019, according the IRI data. But in his stores, Mouton has seen a progressive, long-term upward trend in sales of healthy alternative snacks and similar, energy-type bars.
“Over the last probably three or four years, we’ve doubled the size of that category,” he said. “You’ve got new stuff coming out just about every month. Most of the growth has been with the protein bars, and we love it because it’s typically a high basket ring, and there’s very good margins. That’s a category that we make 40-45% in.”
Mouton said he has also noticed the continued effort by manufacturers across the snacking spectrum to shake things up a bit. “They’re rolling out new products,” said Mouton. “They’re cranking up the marketing and changing the packaging.”
He’s mostly noticed a number of efforts at co-branding to synergize with or piggyback on the success of another product’s strong reputation.
While it’s important to have enough snack variety across consumer demographics, Williams said that, for Dandy, the blue-collar worker is snacking’s bread and butter. Early morning construction workers and all-day truck drivers like their chips and soda.
“That’s a lot of our customer base, so we focus on the stuff that they want to buy,” said Williams.
Source: IRI, “Consumers Provide Pessimistic View of Coming Months,” April 9, 2020
