Consumer snacking behavior continues to evolve. Circana’s Sally Lyons Wyatt looks at the role retailers and manufacturers need to take to meet them in this new space.
Washington — In today’s fast-paced world, snacking has become an integral part of our daily routines. Whether grabbing a quick bite between meals or satisfying a specific craving, consumers will continue snacking to meet a variety of needs. However, snacking, along with most categories across food and beverage, has experienced some unit and volume softness, necessitating a shift in the way retailers and manufacturers engage with consumers.
As we delve into the state of the snacking industry in 2024, it’s essential to understand the dynamic landscape shaped by economic factors, shifting consumer preferences and behaviors, and emerging trends.
Economic Factors
The state of the economy has played a significant role in influencing consumer behavior within the snacking industry. Ongoing inflation has had ripple effects, impacting both prices and consumer spending habits. As prices rise, consumers continue to look for ways to manage their food budgets and cut discretionary spending, leading to shifts in snacking preferences.
Today, consumers are making different snack choices, ranging from buying fewer snacks to opting for smaller pack sizes or multi-packs to stretch their pantry supplies. Consumers have also reconsidered where they shop, with club and convenience channels gaining traction because of their value and accessibility. Dollar stores also have seen an increase in dollar and unit sales and online is holding its own with dollar growth and flat unit sales. Consumers are increasingly shopping online for convenience. Manufacturers will need to address these changes in consumer behaviors if they want to grow unit and dollar sales in 2024.
Channel & Category Analysis
In 2024, mobility-driven snack occasions are on the rise. Mobility is a pivotal factor in elevating morning snacking occasions and catering to the needs of consumers who are heading to the office or traveling. All other snack bars, a great on-the-go snack option with added benefits including plant-based, no dairy, etc., enjoyed increases in both dollar and unit sales during 2023 compared to 2022.
Convenience has emerged as a pivotal factor shaping snack choices and formats. It is a driving force in overall snacking trends, but especially within specific sectors. The demand for single-serve, grab-and-go snacks is increasing for some. Consumers are even interested in convenience within the comfort of their own homes, as they look for quick snack options to help get them through their work-from-home routine or to satisfy teens who are streaming or watching social media. The popularity of delivery services further highlights the demand for accessibility in snacking, especially among younger generations. Affordability is top of mind for consumers, who are opting for snacks that provide them with value and added benefits.
While the majority of snack sectors are witnessing declines in units, certain segments are still finding success. Circana MULO+ with convenience data for 2023 reveals that the snack nuts, seeds, and corn nuts market has experienced declines across dollars (-1.3 percent), units (-3.1 percent) and volume (-15.7 percent). With protein now being included in a variety of snacks and beverages, some consumers are opting for these options over snack nuts. To overcome this, manufacturers should rethink their strategies, approaches to pricing and distribution, and test new products.
During the same timeframe, several salty snacks subcategories have seen continued growth, led by corn snacks with +19.7 percent (dollars), +10 percent (units), and +6.9 percent (volume); pretzels with +11.6 percent (dollars), +2.2 percent (units), and +1.7 percent (volume); and tortilla chips with +11.2 percent (dollars), +0.9 percent (units), and +0.8 percent (volume). The combination of flavor, texture, and continuous product innovation has made tortilla chips particularly resilient, especially among younger demographics. Additionally, pretzels and corn snacks offer unique ingredient blends that appeal to consumers and are engaging on social media, further driving the growth in the category.
Emerging Trends & Challenges
As the consumer landscape continues to evolve, the snacking industry faces both opportunities and challenges. Convenience and affordability remain key drivers of snack choices this year, as consumers seek value and variety in their purchases. While consumers are trying to eat healthier overall, premium snacks and indulgent options that cater to the desire for high-quality and fun experiences, whether at home or on-the-go, will continue to thrive despite slight unit declines. Brands venturing into new sectors will also continue to fuel growth and shift traditional snacking occasions, offering consumers a diverse range of options to satisfy their cravings.
Retail remains the primary channel for snack purchases, despite many Gen Z and millennial consumers opting to purchase snacks at quick-serve locations because of their tendency to be more mobile than some older consumers.
Private label brands have gained momentum but are still a smaller portion of the market compared to national brands. Understanding consumer preferences, whether via attributes, trends, size, or value across channels is crucial for maintaining market share and driving growth in an increasingly competitive environment.
A Look Ahead
As we look at the snacking landscape in 2024 and beyond, innovation and adaptability will be key for continued success. Despite facing economic hurdles and shifting consumer dynamics, the snacking industry remains relatively resilient, largely because snacking is a major part of the lifestyle in the U.S. With a commitment to innovation, affordability, and accessibility, snacking is poised for a successful year ahead.
By remaining aware of shifting consumer needs and desires, snack manufacturers can leverage emerging trends and discover new opportunities to craft products that meet the needs of today’s shoppers. Innovation in the category should focus on delivering a diverse range of products tailored to suit the right ingredients, packaging, size, flavors, and pricing across various distribution channels.
By aligning product offerings with consumer preferences surrounding purchase timing, location, and affordability, snack manufacturers will find success.
Contributor Info: Sally Lyons Wyatt is the global executive vp & chief advisor – consumer goods & foodservice insights, at Circana. She is a go-to expert and frequent keynote speaker on future-forward consumer and retail insights, industry trends, and many topics related to F&B, wellness, and more. She can be reached at sally.lyonswyatt@circana.com.
