Snack World - May 2012 - 19

POTATO CHIPS

A Cut Above the Rest
Kettle cooked, baked, lightly salted, reduced fat and flavor loaded represent just a few of the new potato chip varieties to hit store shelves during the past year. Such new product activity continues to help keep potato chips as America’s most popular salty snack, according to SymphonyIRI Group, which collects scan data of products sold at supermarkets, drug stores and mass merchandisers, excluding Wal-Mart. In the data it provided to the Snack Food Association, SymphonyIRI reported salty snacks amassed sales of more than $9.7 billion for the 52-week period ending March 18, more than twice the dollar sales of cookies, and the overall market’s sales increased 3.4% compared with the previous year. The potato chip category, however, which accounts for nearly 38% of salty snacks dollar sales, experienced a more modest increase of 2% during the same period. With the Top 4 potato chip brands, Frito-Lay North America, Plano, TX, dominates sales in the category. Lay’s, Lay’s Natural, Ruffles and Wavy Lay’s pull in 47.7% of the segment’s dollar sales, according to SymphonyIRI. Add in the company’s other top brands, and it easily surpasses a 50% share of potato chip sales. As in other salted snack categories, the company’s natural potato chips varieties are experiencing the fastest growth: Lay’s Natural and Ruffles Natural sales skyrocketed by 228.9% and 314.5%, respectively. However, some of those sales increases appear to be coming at the expense of its other brands, including its baked potato chips, as Baked Lay’s and Baked Ruffles sales dipped 19.7% and 13.3%, respectively. To maintain its dominance, Frito-Lay launched such products as Lay’s Classic BLT-flavored potato chip in April. Last year, Ruffles Tapatío Limón, which combine a hint of lime juice with the fiery hot sauce for a tangy twist, hit store shelves for the first time. “At Frito-Lay, our flavor experts find inspiration in all corners of the culinary universe,» said Ram Krishnan, vice-president of marketing, Frito-Lay. “Our new Classic BLT-flavored Lay›s potato chips prove that inspiration is sometimes closer than you think. Pairing a delicious sandwich with our tasty Lay›s potato chips is an American tradition that helped inspire us to create this new flavor — a simple indulgence that makes more sense together than apart — just like the BLT.” During an earnings conference call on April 26, Indra Nooyi, chairman and CEO of PepsiCo, Inc., Purchase NY, observed that its snacks division increased net revenues 13%, during the first quarter 2012. PepsiCo is the parent company of Frito-Lay. Ms. Nooyi also noted that the company gained 2 points of value share in the stacked potato chips category, in which it offers its Lay’s Stax product. “And, we expect to see continued momentum as we launch new Hispanic inspired flavors in Q3,” she added. Other manufacturers also have been creative with their chips, including Shearer’s Foods, Brewster, OH, whose Rippled

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May 2012

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Snack World - May 2012

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