Give standbys a twist
When it comes to cooking, condiments have prominent shelf space in American homes, both in the refrigerator and in the pantry. And during the recent recession, this prominence sharply increased. In fact, according to \"Condiments – U.S.,\" an August 2012 report from global market researcher Mintel, total U.S. retail sales of condiments grew by 15 percent from 2007 to 2012, 4 percent when adjusted for inflation, with the highest jump in sales during 2008 and 2009.
\"This is a clear indication that condiment sales can [endure] during periods of economic hardship and even thrive when consumers are cutting costs by opting for home food preparation instead of eating outside the home,\" the report says.
Logically, the report found that as confidence in the economy improved in 2010 and consumers began eating out more often, sales of condiments dipped. However, Mintel forecasts conservative growth within the condiment category through 2017 to culminate in sales of $10.7 billion.
Do
offer healthful options such as low-sodium, reduced-fat and reduced-sugar items.
Dont
ignore innovative, premium flavor profiles.
Think flavorful, healthful
The term \"condiments\" can be defined loosely as ketchup, mayonnaise, mustard, pickles, relish, pickled peppers and olives.
When it comes to pickles, sales have been flat for the past five years, says Paul Kastl, director of sales and marketing, Giulianos Specialty Foods, Garden Grove, Calif. To stimulate sales, companies have been trying to create new flavor profiles such as jalapeno, chipotle and Italian to spice up a jar of dill pickles previously seen as boring, he adds. Peppers and olives, however, have continued to see healthy growth, mainly due to specialty areas such as olives stuffed with garlic cloves, jalapeno pieces or onion pieces, pepperoncini and banana peppers, Kastle adds.
When it comes to condiment users in general, Mintel reports that 52 percent say that a low sodium content or sodium-free status is important to them when choosing products, and 52 percent of condiment users are also interested in condiments that are all-natural and free from artificial additives and preservatives. This trend indicates a definite shift toward \"better-for-you\" products such as organic items.
\"While the overall shelf-stable category is slightly soft, were seeing growth in the premium and organic segments,\" says Harry Overly, vice president, marketing for Oak Brook, Ill.-based TreeHouse Foods Inc.
For example, when it comes to ketchup, Mintel reports that despite its widespread use, the low price point of ketchup and the popularity of private label offerings keep dollar sales low, adding that ketchup sales would benefit from the introduction of specialty offerings.
And \"better for you\" ketchup is one example of a specialty item that is leading the category, says Mike Hackbarth, vice president private label, The Fremont Co., Fremont, Ohio. For example, organic ketchups and ketchups that use stevia, an all-natural sugar substitute that allows for 25 percent less sugar and 25 percent fewer calories, are doing very well, he says.
Do
feature store brand condiments in off-the-shelf displays and in the deli.
Dont
expect a condiment to sell just because it is cheaper than the national brand.
Besides showing up in spicy varieties and other flavor-infused options, mayonnaise also has been treated to innovations that focus on the better-for-you trend such as reduced-fat and reduced-sodium varieties and those that use olive oil, Mintel reports. That reality spurred the segment to post the largest year-over-year gains, 4 percent in 2012, when compared to other condiments during the same time period.
Provide, promote quality products
But when it comes to offering these premium private brand offerings, retailers need to create trust among their consumers, or the products will just sit on the shelves.
\"For a successful premium program,\" Overly says, \"it is essential that the retailer has strong brand equity for consumers to trust that the products they are buying will truly be superior to ... national brand options.\"
For a long time, private label has been seen as \"cheap,\" Kastl says, typically around half the price of the national brand, and good condiments, especially items such as olives and peppers, usually dont come cheap. Even if they do, they probably do not have the high level of quality that consumers want, and that reinforces to the consumer that the private label is not as good as the national brand, he adds.
\"This is where the [retailer] has to say, We cant afford to scare our customers away with a low-quality product because the customers will then perceive that [quality] to be the same way across the store,\" Kastl says.
Once retailers have a product they are proud of, it becomes vitally important to merchandise it effectively within the store.
Once retailers have a product they are proud of, it becomes vitally important to merchandise it effectively within the store.
\"The biggest challenge [retailers face] is poor merchandising and communication strategies,\" Overly says. \"Best-in-class retailers – those with well-above-average private label shares – typically promote their store brands at higher levels than average retailers, and their promotions have a greater proportion of feature and display activity.\"
Jennifer Kolb, director of business development for Peppers Unlimited of Louisiana Inc., New Orleans, recommends both end caps and deli marketing because it makes the condiments highly visible to the consumer.
Another way to merchandise condiments is to take advantage of both impulse buys and seasonable/holiday buys, says Dan Kelly, vice president of sales for Tracy, Calif.-based Musco Family Olive Co. Plus, he adds, using condiments to create meal solution events allows the retailer to build up the basket while also satisfying the consumers question: \"Whats for dinner?\"
Overly recommends end caps featuring the leading national brand and the store brand with a \"buy-the brand/get-the-store-brand-free\" promotion to encourage trial.
And making use of display-ready open-front cases can generate in-store labor savings, as well as incremental sales, Hackbarth says.
\"Many leading brands like Heinz sell their product in display-ready open-front cases because they know the value of getting off the shelf,\" he adds.
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| New on the Shelf |
| New from Brampton, Ontario-based Loblaw Companies Ltd. are Presidents Choice Black Label Castelvetrano Green Olives from Sicily. The olives are said to have a vibrant apple-green color and a mildly buttery, lively sweet flavor. They retail in a 190ml glass jar. |
| Now available from ALDI Inc., Batavia, Ill., is Specially Selected Whole Grain Mustard. Imported from Dijon, France, this mustard is described as grainy with a robust flavor. Gluten-free and lactose-free, it retails in a 12.3-oz. glass jar. |
| New from San Antonio-based H-E-B is H-E-B Organics Ketchup. Made with vine-ripened tomatoes, the product is certified USDA organic and retails in a 24-oz. PET bottle. |
| Compliments Mayonnaise with Olive Oil from Sobeys, Stellarton, Nova Scotia, is made with a blend of soybean oil and olive oil. This product is a source of omega-3 and omega-6 fatty acids and polyunsaturated fat. It retails in an 890ml PET jar. |
| Source: Mintels Global New Products Database |