Category Review: Dips, Spreads & More -- Spread the Word

July 14, 2008
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 In recent years, dip and spread offerings have evolved way beyond the traditional onion dip and port-wine cheese spread to encompass a wide range of interesting flavors and textures.

North Americans long have counted on dips and spreads to liven up parties, flavor up barbecues and even make veggie consumption more palatable. In recent years, such offerings have evolved way beyond the traditional onion dip and port-wine cheese spread to encompass a wide range of interesting flavors and textures.

That evolution likely is one reason these categories continue to demonstrate extraordinary growth. And the refrigerated spreads category looks especially bright.

In fact, data from Chicago-based Information Resources Inc. (IRI) show dollar and unit sales for the total refrigerated spreads category jumping 20.4 percent and 15.3 percent, respectively, during the 52 weeks ending April 20, 2008 (excluding Wal-Mart).

Retailers likely have hummus to thank for the big spike in refrigerated spread sales. The Mediterranean-style chickpea, tahini and spice mixture is now a $143 million-plus business, according to a February 28 Associated Press article.

Hummus’ popularity fits right in with overall trends toward more healthful foods, notes Michael Lieberman, vice president of sales for Hot Mama’s Natural Foods, Springfield, Mass.

Dominick Frocione, vice president of sales for Cedar’s Mediterranean Foods Inc., Bradford, Mass., agrees, adding that Mediterranean dips and spreads are consistently chalking up double-digit growth on the branded side.

Cedar’s recently introduced authentic Greek-style Tzatziki, Frocione says, made with Greek-style yogurt. The dip comes in four flavors.

Salsa, too, continues to be a healthful consumer favorite, although the total category did experience a miniscule dip in unit sales for the 52 weeks ending April 20, 2008, IRI data show.

And more traditional-style refrigerated and shelf-stable dips are flaunting enough new flavors to ensure consumers don’t become bored.

“New brand introductions such as Creamy Spinach and Creamy Southwestern Ranch are providing continued growth in the category and exciting opportunities in the private label shelf-stable dip category,” stresses Patrick Starrett, marketing manager for Dakota, Ill.-based Berner Foods Inc.

Indeed, shelf-stable dips also are on a growth curve, as are their refrigerated counterparts. In addition to new flavor varieties, new products within these categories often sport various cheese bases.

Pump up Private Label

Despite all the consumer interest in dips and spreads, private label’s share is not all that impressive --with the exception going to the refrigerated dips category. But retailers likely will find no better time to beef up store brands here.

“Consumers are looking for variety, convenience, quality and value,” Starrett says. “With double-digit increases in gas, healthcare costs, etc., private label becomes an increasingly important option for consumers to get quality and value.

“People are eating out less but still want variety at home,” he adds. “New product introductions are key.”

Berner’s Destination Supplier program currently offers three tiers and 10 flavors on the shelf-stable dip side, Starrett notes,        and the company’s portfolio continues to grow.

“We are constantly in development of new products, analyzing current industry trends and bringing the quality/value equation to the retailer and, ultimately, to the consumer.”

Speaking of product quality, it’s critical, Hot Mama’s Lieberman stresses. Also, consumers are beginning to be wary of “anything with chemicals in it.”

Lieberman notes that Hot Mama’s can make any dip or spread organic -- or natural -- using the retailer’s recipes and idea.

“We can dictate the flavor profiles; we can dictate the consistency -- if they want it smoother, grainier, heavier, lighter,” he says.

Frocione says Cedar’s offers upscale dips for retailers that seek out a quality private label. The company provides both conventional and natural product options in a variety of sizes and container options, he adds.

Yes - the packaging counts, too.

To further tempt shoppers to a purchase, retailers might want to cross-merchandise private label dips and spreads with suggested snacking companions. For example, Frocione recommends combining hummus with pita chips. The bonus? Additional unit sales for the retailer.

Starrett says store brand shelf-stable dips should reside in the snack aisle close to the tortilla chips - at eye level, to the right of the national brand.

To spur store brand sales across the entire dips and spreads category, Starrett also suggests that retailers use at least four facings per SKU, invest in point-of-purchase ‘compare and save’ shelf signage, and price-shield when the brand is on deal. PLB

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