Sauces, Salsa & Marinades: The State of Taste

April 25, 2008
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The sauce, salsa and marinade categories are experiencing shifts in consumer preferences, causing a flavorful mixture of growth and stagnation.

Our society places many - and often contradictory - demands on consumers today. The media says to spend time with your family, spend time preparing sumptuous meals, spend time examining the labels on your food, spend time at work, spend time at play, and spend time at the gym. It’s enough to make consumers want to give up completely and throw themselves at the mercy of the fast-food gods.

This is where pre-made sauces and marinades come in to save the day. At a time when the term “healthy” seems to routinely contradict the notion of “easy,” more and more companies are diversifying their culinary cabinets to produce products to please consumers by being both healthful and easy.

One of the major trends in this area is no stranger to the food market: organic. Ron Rash, president of The Wizard’s Cauldron, Yanceyville, N.C., notes that the company’s biggest sellers often are wheat-free, gluten-free and vegan sauces and marinades.

“The organic consumer is looking for fresh, new and authentic - and all indications are that these categories are growing at high rates,” Rash says.

Indeed, according to the Organic Trade Association, “Organic foods have grown between 17 and 21 percent each year since 1997, to nearly triple in sales, while total U.S. food sales over this time period have grown in the range of only 2 to 4 percent a year.”

Despite those robust numbers, the organic sector of the food industry still makes up only 2 percent of total sales. Still, many companies believe a’change is gonna come.

According to Michael DelGrosso, director of sales and marketing at DelGrosso Foods, Tipton, Pa., “Organic and ultra-premium sauces are appearing more frequently in private label programs to meet the growing demand for high-quality products.”

Why are consumers suddenly concerned as to the color of their cocktail sauce and the content of their marinara? Many argue it is the explosion of the health sector combined with a growing consciousness about health issues. An anxiety over what people are feeding themselves and their children has translated into a call for better products.

The Standards

This mandate for more healthful products goes beyond just organic. Touting specific ingredients for their health value and focusing on core nutritional needs help boost the sales of sauces and marinades.

“Certain segments of pasta sauce continue to grow as diet trends such as Atkins start to fade in the distance, while tomato products have regained star power with new emphasis on their incredible health benefits,” DelGrosso says.

But it’s not just the blushing tomato that has enhanced private label’s stature in the healthy heart fan club. Innovation is key.

As Ricardo Rodriguez, vice president of sales and marketing at Simply Fresco, San Antonio, Texas, explains, “We are experiencing quick acceptance of items that aren’t even available from the national brands.”

Despite this growing trend toward the uber-healthy, traditional sauces and marinades are continuing their domination in the marketplace and in consumers’ cupboards. Chicago-based Information Resources Inc. (IRI) reports that spaghetti sauce raked in $1.4 billion, with private label selling almost $90 million of that figure.

Mike Klanac, president of marketing at The Carriage House Cos. Inc., St. Louis, notes that the numbers from these traditional mainstays are indisputable. “From a sheer volume perspective, the historical category leaders have continued to hold their position,” Klanac says.

But - and this is a big but - the numbers in other popular categories have dropped dramatically. Barbecue sauce, while hitting $363 million, saw a meager 0.3 percent increase in the overall category, and a 3.2 percent decrease in the private label sector. Similarly, the numbers have been disappointing in the conventional sauces - hollandaise, taco and steak - both in total category and private label.

A Twist on Taste

With traditional tastes declining, and bolder and newer tastes coming to take their place, what’s a sauce to do?

“New flavors continue to be introduced, with older offerings being discontinued, as branded manufacturers push to maintain their share of what has become a relatively flat pie,” Klanac comments.

Rodriguez adds, “Fusion food is a big driver since it appears to help gain acceptance of new flavors through some other known alternatives.”

Such cross-pollination of flavors is a direct response to both the diversification of the consumers and their desire for excitement on the dinner table.

Jere Bahner, corporate chef at Old World Spices and Seasonings, Kansas City, Mo., sees the stodgy old dinner being replaced by the flashy, younger meal. “People want to be creative at home. BBQ chicken on the grill is great, but it’s even better when you can spice it up a bit.”

There also are fiscal advantages to such experimentation and adventurousness, according to Scott Turley, senior marketing analyst at Red Gold LLC, Elwood, Ind.

“There are those who seek out new flavors and innovative items and they have an advantage because their items receive the lift from consumer trial and, in many instances, the conversion from trial to loyalty that many national brands enjoy,” Turley says.

Cost as an Ingredient

Such varied trends can cause problems for private label companies trying to keep up with the ever-shifting winds of consumer consumption. From low-carb to low-sugar to low-sodium, from Thai to Indian to Japanese, the roller coaster ride of food fads can be costly and uneconomical to a company.

In addition to the changing landscape of food tastes, private label companies must also be cognizant of the market itself. In the infamous words of political consultant James Carville: “It’s the economy, stupid.” But just how the economy affects the sauces and marinades market is up for minor debate.

According to Rodriguez, “The reasonable answer is that store brands thrive during less optimistic outlooks towards the economy, but the reality is that the national brands also react to these macroeconomic trends. The items that tend to be impacted most are those considered luxuries or discretionary-income purchases.”

Turley concurs: “During an economic downturn, consumers are more apt to eat at home and turn to private label items for savings.”

On the other hand, “A strong economy allows the consumer to take more chances on their purchases, and I believe we get more private label trial because of this,” Rash says.

Yet others think that the economy is not the cause of the wavering dollar sales in the sauce, salsa and marinade market. Instead, the fluctuation can be attributed to production, rather than consumption, concerns.

“The issue we’re facing now is unprecedented cost increases in the raw materials used in the making of various sauces, which ultimately has to impact shelf pricing,” Klanac says. “While national brands can address this issue via tight control of promotional funds, store brand manufacturers simply don’t have that luxury.”

Yet even with the increase in pricing and decrease in economic stability, some consumers are willing to pay for these private label marinades, sauces and salsas.

“We see that some people are choosing to dine at home to fight high gas prices, and are choosing to purchase more gourmet grocery items to maintain their ‘indulgence’,” DelGrosso observes.

Whether these quality sauces, salsas and marinades are organic, health-conscious, mom-and-pop traditional or a fusing of international tastes, private label continues to grow at a faster rate than national brands, gaining both prestige and loyalty.

“Consumers in general,” Rodriguez says, “are becoming more savvy about store brands, and they have learned that there are many categories, especially commodities, for which there is no good reason to pay more for the national brand.”

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