Bagged snacks 2023: Crisp brands prioritise exciting NPD

As volumes fall and own label gains share, branded bagged snacks are pulling out all the stops in innovation. Over the past year, a flurry of weird and wonderful flavours have taken grocery shelves by storm.

Take PepsiCo, which has focused on delivering “exciting” variants to set its brands apart from private-label lines, explains CMO Fiona Tomlin.

In June, its core Walkers crisp brand unveiled a three-strong range of limited-edition flavours inspired by sister brands.

Wotsits Really Cheesy, Monster Munch Pickled Onion and Doritos Chilli heatwave would “drive excitement among consumers and appeal to shoppers looking for innovative snacking options”, Walkers said at the time.

Crisps collaborations bolster snacking sales

That was after Doritos teamed up with Burger King in March to launch a co-branded Flame Grilled Whopper variant. Supported by an on-pack promotion offering the chance to win a Whopper meal, it became “one of the bestselling flavour launches for the brand”, Tomlin says. Then Walkers Max partnered with a fast-casual restaurant. It added Pepperoni Feast and Texan BBQ in August, co-branded with Pizza Hut. The duo is designed to “tap growing demand among younger consumers for pizza flavours within savoury snacking”, Tomlin explains.

That same month, Proper Snacks enlisted KFC for the co-branded Popcorn chicken Popcorn, billed as a “chicken-y, herby snack that hits the spot”.

Come the end of the year, Doritos, Walkers Max and Proper are all in volume growth – by 0.2%, 19.8% and 13.4% respectively.

It suggests creating excitement in bagged snacks will be crucial for brands overall as they work to claw back volumes. They’ve sold 9.1 million fewer kilos of crisps, popcorn and nuts, as thrifty shoppers turn to own label.

Conversely, own label snacks have shifted an extra 5.1 million kilos in the past year, driven by premium lines.

“As a cheaper option, private label has been a growing threat to brands as prices increase,” says Jack Davies, NIQ senior analytics executive.

“Brands must focus on taste and delivering a quality product at a good price to maintain repeat rate and compete.”

It’s also crucial that innovations – like PepsiCo’s and Proper’s – are non-HFSS if they are to secure key promotional spaces in the supermarkets.

“Manufacturers who have been able to reformulate their products and have a mixed portfolio have been able to hold onto off-shelf space,” Davies adds.

KP Snacks is a case in point. It’s been attempting to lure young shoppers with experimental flavours that comply with HFSS regulations.

“At the beginning of this year, we launched McCoy’s Epic Eats, a new range which delivers on McCoy’s unmistakable bold flavours, while promising an epic snacking experience for shoppers looking to try something new,” says KP Snacks sales director Andy Riddle.

The non-HFSS range debuted in February, with two Mexican-inspired variants – Nacho Cheese and Spicy Salsa – in a 45g grab bag and 65g PMP.

The top flavours driving bagged snacks sales

KP Snacks then expanded the lineup in July with Chip Shop Curry Sauce and Bangin’ BBQ six-bag multipacks.

Early signs for the range have been good: Epic Eats has helped McCoy’s achieve a modest 0.3% uplift in unit sales while it’s registered an extra £23.5m.

KP has also turned attention to its nuts portfolio, which is exempt from HFSS regulations. Early on this year, it added a Sour Cream & Chive variant to its Flavour Kravers range, which debuted in March 2022 with Flame Grilled Steak and Smokin’ Paprika.

New Crunchy Coated variants Katsu Curry and Aromatic Thai Chilli followed in October.

Riddle is confident continued innovation will drive incremental sales, as “compared to the rest of Europe, the UK has a much lower per capita consumption of nuts”.

“Our strategy has been to develop a portfolio that moves the brand beyond the traditional evening sharing and pairing occasions, which remain extremely important, and into other needs and occasions.”

It’s a strategy that seems to be working. Seven of KP Snacks’ top 25 brands are in volume growth. These include Hula Hoops, KP Nuts, Skips, Nik Naks, Pom-Bear and Discos.

Then there’s Hula Hoops, which has registered a £29.7m gain. This comes after the January launch of its £1m ‘Hula Licious, Hula Lightful’ campaign, which aimed to drive awareness of the brand’s healthier Puft range.

The impact of HFSS on crisps and snacks sales

For other bagged snack suppliers, a lack of non-HFSS options has had a deleterious effect on sales. Pladis brand Jacob’s, for example, has lost £13.9m on volumes down 25.9%.

Jacob’s marketing manager Catherine Morgenroth says the HFSS legislation “resulted in lost off-shelf features”, which had a knock-on impact on sales.

“The dip in value and volume sales we’re seeing isn’t unique to the brand, or even the wider bagged snacks category, and it’s also no cause for concern,” she insists.

Still, Jacob’s is the second fastest faller in the top 25 in value percentage terms, down 11.9%. Only Kettle Chips has fallen faster. It’s down 26% in value, while volumes have plunged 42.3%. That’s roughly the equivalent of 24.3 million 130g sharing bags of crisps.

Russell Tanner, marketing director for Kettle Chips at Valeo Foods, says the brand was “particularly affected by the oil crisis, as a result of the war in Ukraine, which has increased costs, led to supply chain challenges and limited our ability to promote Kettle Chips.

“Coupled with this, the cost of living crisis has had an effect, which has meant we’ve seen some distribution losses.”

In a bid to reverse its fortunes, Kettle Chips added new Dill Pickle & Jalapeño and Sriracha Mayo variants in April, followed by the October launch of its first-ever ridge-cut crisps, Asian Chilli Beef.

And those are the sort of trendy and unconventional flavours that translate into gains for the bagged snacks category.