Snaxshot #10: The State of Big Food™
return of the snack
A newsletter on upcoming food and beverage trends that offers a curation of brands and aesthetics written by Andrea Hernández.
🔮 Hindsight is 2020:
BigFood™’s big moves.
Snaxshot of market in the past year.
Market challenges + opportunities.
Don’t be shy, the water’s warm, don’t forget to hit the subscribe button below.
Return of the Snack 🍪
Memories are rooted in the senses.
Consider food as a time machine and taste buds as light bulbs flashing with excitement recalling that bag of Oreo Thins you ate in one sitting, or that classic Lunchable you paired with a glass of vino because who the hell had time to bake sourdough bread, amirite?
In a year filled with uncertainty and chaos, we resorted to comforts we thought we had left behind for the glitz of “healthier” alternatives —when the world felt like it was crumbling around us, we crawled into the arms of a past lover.
As it is with anybody who’s been ghosted before, we collectively sent out a drunk text thinking we would be left on read.
But instead BigFood™ invited us over, and remedied our mix of anxiety and exhaustion from sticking shit into stoves, by welcoming us with soul-soothing snacks.
Snacking Solo 🥨
—Snacking industry = $1.2 trillion as of 2020
—In 2020, salty snacks reported 9.4% growth in earnings with $21 billion in sales.
—Growth in “plant-based” snacking —global PB snacks market was $34.69 billion in 2019 and forecasted to reach $73.61 billion by 2028.
—Snack sales through ecommerce were up 44%
—This year 46% of Americans said they found themselves snacking more, millennials leading the movement, most citing they used snacking for comfort versus function.
—According to Frito Lay , 85% of their consumers say eating their favorite snack brought them a sense of normalcy.
—85% of Americans said they have changed their diet away from three meals a day and relying on snacks to power through a day.
—According to Mondelez, more than half of global adults have been buying nostalgic snack brands from childhood.
— In US, chips and chocolate were among top growing categories, in Europe it was crackers AND chips.
—Mondelez reported that 64% of millennials say that shopping online for snacks has now become “part of the routine”
BigFood™ Bounced Back 🚴
This year BigCorpDaddy™ got their bloated asses unto a Peloton determined to shed weight and show off their “gains” because money can guarantee you ONE THING—a lockdown glow up.
These giants have been breaking a sweat all year long trying to slim down what made them sluggish and loose appeal to slimmer, younger startups—bulking up on growing brands and worked up an appetite for bigger pie slices.
BigFood™ wants its market share back, beware of incoming thirst traps.
—Bought energy drink Rockstar for $3.85 billion.
—Bought all outstanding stock on Pioneer Foods for $1.7 billion.
—Doubled down on ecomm by piloting its first micro-fulfillment center in Chicago to reinforce DTC efforts.
Coca Cola Company:
—Acquired the remaining stake in Fairlife
—Cuts 2,200 jobs or 17% of their global workforce
—Seeking “less complexity in supply chain” cuts brands by half, stays at 200, shelled out slow-selling brands:
Zico coconut water
Diet Coke Fiesty Cherry
Odwalla smoothie & juices
—Reducing business segments from 17 to 9
—Plans to put savings towards in growing brands/fund launch of new products:
Topo Chico Hard Seltzer
Aha sparkling water
—Transitioned from managing portfolio as more than 55 individual categories to just 6 consumer-driven platforms:
Easy Meals Made Better
Real Food Snacking
Fast Fresh Meals
Easy Indulgent Desserts
—Announced it’s focusing 50% less on innovation in 2021
—Offloaded its natural, grated, cultured + specialty cheese businesses to Groupe Lactalis for $3.2 billion
—Launched DTC initiative in UK, Heinz-to-Home + subscription service
—Acquires Zenpep, expanding its medical nutrition business
—Nestlé Health Science acquires majority stake in Vital Proteins
—Launches plant/insect based Purina products and will be allocating $550 million to expand their manufacturing capacity
—Sells its Yinlu peanut milk + canned rice porridge businesses in China
—Launched R&D accelerator seeking innovation re: dairy products + plant based alts
—Made its plant based debut in China with Harvest Gourmet products
—Mars acquired KIND
—KIND acquired Nature's Bakery
—Strong Q3 earnings (sales up 8%) as CEO announced “return to home cooking” less of a trend and more of a habit
—Acquired Cholula for $800 million.
—Raking in so much dough (pun intended) they bought a bunker for their Oreo recipe
—Their sales are up 15% since 2019
—Acquires majority stake in Canadian co, Give & Co
—Launched a healthier Cadbury bar and continues eyeing healthier snack companies as potential acquisitions
—Sold Lender’s Bagel to Grupo Bimbo.
—Selling Peter Pan peanut butter brand to Post.
—Acquired Aviation Gin and Davos Brands
—Acquired Chase Distillery, includes Chase GB Gin + Chase potato vodka
—Announced restructuring plan 12-18 months of exiting underperforming brands, creation of dedicated pet food sales organization.
—Sells Crisco to B&G Foods for $550M
—Divests its Natural Balance, premium pet business
—Acquired Truco, manufacturer of tortilla chips, salsa and queso sold under On The Border (OTB) brand
—Divesting tea, Tazo, Pukka Herbs, T2 and others, but keeping Lipton.
—Bought SmartPants Vitamins to complement portfolio
—Set sales target from plant-based meat and dairy alternatives at $1.2 billion in next 5-7 years.
—Expanded partnership with Burger King to supply its plant-based meat patties for Whopper burgers in LatAm, Caribbean + China.
Staying in shape ain’t easy 🥵
—Regulation (More countries requiring BigFood™ to label high calories/sugar content)
—Climate change initiatives and reducing pollution (Nestle, CocaCola and Pepsi were named top three polluters around the world)
—Consumer habits rapidly evolving (millennial/GenZ leading change)
—Food supply chain disruptions
Letting go of the bloat, helps to see clearer 🧘🏽
—E-commerce initiatives providing consumer insights directly (versus 3rd party) also making it easier to test new products
—Opportunities to appeal both to new consumers and reduce waste via incentivizing regenerative agriculture and upcycling.
—Pumping up R&D in alt-foods (in lieu of M&A considering expensive valuations of the alt brands re: Impossible, Beyond Meat) as well as wellness products (sales of food + beverages with added benefits ie electrolytes, minerals, adaptogens + probiotics are expected to reach $275b by 2025.
Spoonful of News 🥄
Drone deliveries are closer to reality with new approval.
First came the adaptogenic butters and now hemp nut butters are launching next week.
In China, this new tech will have your food descending from the roof (wtf?!)
3D Doritos are officially back on shelves as of this week.
GoodMeat has officially launched.
See you again next week, a different future, same place.
🔮 Tweet at me @thesnaxshot.
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