Doctor’s orders: snack bars category report 2020

Talk about different times. Back in the era of disco and bell-bottom flares, Mars was able to market itself as practically a health product. The jingle that started in the 1970s – “A Mars a day helps you work, rest and play” – was a long-running hit.

It arguably reached its ironic pinnacle in 1982, when Mars unveiled a sensation to mark its Golden Jubilee. “Fifty years of Mars goodness and now we bring you the biggest Mars Bar ever: even more milk, more glucose, more sugar and more thick, thick chocolate,” proclaimed the TV ads, before ending with the trademark jingle.

The doctors at Public Health England would keel over if Mars tried that today. In this age of portion control and calorie reduction, sugar is the great white devil. Today’s shoppers are far more likely to understand that sugar is glucose (hence why Cadbury has quietly rebranded Boost Glucose as plain old Boost, no doubt). Bigger is not better. Even milk is going out of fashion.

Enter the new generation of ‘healthier’ snack bars led by players such as Grenade, Kind and Eat Natural. While Mars is losing value [Nielsen 52 w/e 7 September 2019], brands such as these are flying. Take-home sales of sports and nutrition bars are up 11.9% to £132.2m, on volumes up 9.1% [Kantar 52 w/e 8 September 2019]. Some products are outselling traditional chocolate bars many times over. So can they succeed in pushing health messages where Mars failed? And what’s next for the market?

The ‘Mars a day’ line might be anathema to modern ideals of healthy eating and responsible advertising, but it can still be seen as a precursor to today’s snacks. Mars’ ads promised indulgence – see the ‘thick, thick chocolate’ being folded over nougat and caramel – alongside functional benefits (the ‘work, rest and play’).

In that respect, not much has changed. “Snacks still have to hit the sweet spot of functional benefits and indulgence,” says Mark Brown, marketing director at General Mills, owner of Nature Valley and 90-calorie per portion cake brand Fibre One, among others. “Fibre One is pure indulgence but it’s still giving a real lifeline to people in the weight management space,” he says. The way they push this message, though, has evolved. “We will never tell anyone to eat our products day in, day out,” continues Brown. “It’s all about having a balanced diet – calories in and calories out. For everyone in snacking, it’s about delivering functional benefits in ways that still feel indulgent.”

“Snacks still have to hit the sweet spot of functional benefits and indulgence”

Granted, this proposition isn’t entirely muscling out traditional confectionery. After all, the supers sold an extra 15.9 million packs of chocolate in 2019, making it grocery’s fastest-growing sector in value terms [Top Products 2019]. However, this was partly the result of premium new product launches designed to be shared at home – allowing snack bars to gain share of the ‘on the go’ space.

 

Snack bars value sales: sports bars add power

Snack bar sector performance
	Value (£m)	% growth	Market share
Healthy Bars	229.8	-2.4	36.3
Treat Bars	146.4	2.6	23.1
Sports & Nutrition	132.2	11.9	20.9
Breakfast Bars	125.1	0.4	19.7
Brands vs Own Label
	Value (£m)	% growth
Brands	542.8	0
Own Label	90.6	16.1

Source: Kantar 52 w/e 8 September 2019

 

• Snack bars sold on their nutritional and sporting benefits are growing their share of the market, according to Kantar.
• “Sports & nutrition lines have been the main driver of growth, with a 13% increase in volume sales resulting in a £14m increase in spend,” says Kantar’s Keith Gowan.
• “Much of this can be attributed to the rise of protein, as brands look to compete with sports-focused manufacturers. Eat Natural Protein Packed and Nature Valley Protein are doing well.”
• Gowan also singles out Kellogg’s Special Protein Bars and Bites, Nestlé’s Yes brand, which comes in 100% recyclable packaging, and Nakd Salted Caramel as notable launches from the past year. “Own label has seen some new flavours released throughout the year too, most notably Aldi’s Jaffa Cake cereal bar,” he adds. “Tesco has also been successful with its cereal bars range.”
• Such lines, which significantly undercut brands, have driven strong growth for own label, up 16.1% in value and 10.7% in volume. Brands have flatlined in value as five million fewer packs went through the tills.

Hectic lives

Crucially for snack bars, this space is growing. “Consumers are living more hectic lives and snack bars play an essential role,” says Scott King, category manager at Eat Natural. “Longer commutes and increased working hours are fuelling this, and consumers are using snack bars to keep their energy levels up in a convenient way.”

So, three square meals a day is no longer the norm during the working week. “Many are moving to five or six smaller meals a day,” adds General Mills’ Brown. “That means there are a lot more players coming into snacking and we have to think about the market much more horizontally. Snacks are now in almost every category in the supermarkets.”

See the rise of everything from breakfast biscuits and drinks to meat snacks and protein bars (to name a few examples) for proof. With consumers snacking more and sitting down for fewer square meals, they are looking for more from their snacks. Milk, glucose, sugar and chocolate – no matter how thick – are just not going to cut it.

“Consumers are living more hectic lives and snack bars play an essential role”

So the healthier, convenient proposition of snack bars is hitting the right notes – as the growth of some of the biggest brands illustrates. Go Ahead gained £4.7m [Nielsen 52 w/e 21 January 2020]. Fibre One is up £2.2m, while Eat Natural amassed an extra £2.1m.

Kind Snacks marketing director John McManus says his brand, which isn’t included in our Nielsen data, is the UK’s fastest-growing snack bar. Indeed, Kind’s Dark Chocolate Nuts & Sea Salt variant is now the country’s bestselling single snack bar, outselling even traditional chocolate countlines from the likes of Cadbury and Mars, he claims.

That’s significant, given that Mars owns a stake in Kind and is rumoured to be eyeing the brand for acquisition. “We have a vision of being worth more than £100m, that’s bigger than most confectionery brands, by the end of 2021,” adds McManus.

“Our bestseller Crunchy Peanut Butter has at least doubled distribution in the three biggest retailers in the UK, primarily in impulse. Those distribution gains are not down to Mars’s influence. We are a completely separate entity.”

McManus says the gains are more to do with a change in attitude, rather than big brand power. “Over the past five years, consumer education has exponentially increased, and people understand today that when they are out and about, they need to make good choices in their snacking,” he says. “They know that a healthier snack bar like Kind is going to be a far better choice than a bar of Dairy Milk.”

Granted, Kind doesn’t seem much better if you look purely at calories. A standard 29.3g bar of Dairy Milk contains 157 calories, while a 40g Kind bar weighs in around the 200-calorie mark.

Indeed, many ‘healthy’ bars contain more calories than a standard 51g (228-calorie) Mars Bar, as a Daily Mail article pointed out in September. Among those listed were the Nutramino Coconut Protein Bar, which packs 290 calories and 9.9g of saturated fat per 66g portion and Grenade, whose 60g White Chocolate Peanut Bar contains 242 calories and 5.8g of saturated fat.

Crucially, to their marketing at least, both of these bars contain far less sugar than Mars. Plus, there is the issue of the positive things they purport to contain. Many brands are keen to emphasise that they are more than just empty calories. Kind, for example, says its ‘nutritional snacks’ contain the ‘finest ingredients’. And for those looking for an extra dimension to their nutrition, it also has a Protein range.

The latter example highlights another market trend. Because the appetite for all things protein isn’t going anywhere soon. Protein bar brand Fulfil has the figures to back that up. “The total single snack bar market grew by £33m in 2019 to £871m,” says UK MD Dave Pogson, quoting IRI numbers [confectionery, cereal & sports nutrition bars under 90g/serving 52 w/e 29 December 2019].

“The largest proportion of this market is chocolate countlines but with growth of 44%, protein bars accounted for 60% of total market growth. That’s a massive £20m, with virtually all of this growth coming from just three brands: Fulfil, Grenade and Kind. With growth of 48%, Fulfil was a major part of this success. Functional snacking for modern consumers is all about taste and health working hand in hand.” Hence the glut of protein-enriched cereal bars now on the market. Natural Balance Foods, which was bought by Belgian giant Lotus Bakeries in 2015, claims to have shifted 1.3 million Trek Protein Nut Bars since launch last year. Meanwhile Weetabix says the Alpen Protein Bars it launched in 2019 are now worth more than £1m at the tills, which has mitigated declines in its other lines.

“Protein products have already added more than £18m to the cereal bar category,” says Alpen marketing manager Helena Blincow. “Alpen’s Protein bars have mass market appeal, both our chocolate and berries & yoghurt products continue to prove popular. They are driving a different shopper into both the protein category and the brand, and can be found across all major multiples.”

Plus, these new-wave protein bars often have a selling point the original brands don’t. “Consumers are often put off by the long list of artificial ingredients and with the trend for natural foods, we’re seeing very strong growth for our protein-packed range, which utilises plant-based sources like nuts,” says King at Eat Natural.

Top 10 cereal bar brands: Cadbury provides a boost

Top ten cereal bar brands
	Value (£m)	% growth
Belvita	54.5	0.8
Nature Valley	44.6	-10
Nakd	36.9	1.7
Go Ahead	30.5	18.1
Cadbury Cereal Bars	30.4	18.5
Eat Natural	29.2	7.6
Fibre One	24.0	10
Kelloggs Rice Krispies	23.7	2.9
Alpen	23.2	-9.1
Graze	14.1	14.2

Source: Nielsen, 52 w/e 25 January 2020

 

• Britain’s 10 biggest cereal bars have put an extra £9.8m through the tills in the past year, a rise of 3.3% on units up 4.1%, according to Nielsen data. Nearly half of that growth came from just one brand: Cadbury Brunch Bars.
• Susan Nash, trade communications manager at Cadbury owner Mondelez, puts much of the success down to the Peanut Protein and Cranberry & Nuts Protein variants added last autumn. Protein remains a powerful proposition for shoppers, she says. “Two thirds of cereal bar buyers associate protein bars with energy and broader wellbeing.”
• Mondelez isn’t the only one spotting an opportunity in protein. “Graze and Alpen have launched protein variants and Alpen’s parent company, Post Foods, has announced the UK launch of Premier Protein (see p54),” says Nielsen senior client analytics executive Holly Lyford.
• Second and third fastest growers Go Ahead and Fibre One have both seen average prices fall by 6.7%. “Go Ahead has moved to everyday low pricing, reducing volume on deal to 12% (category average is 54%), while Fibre One has increased deals” Lyford says.
• Nature Valley suffered as a result, sustaining the greatest loss of the year (£5m). Despite the launch of its protein lines, Alpen took a hit of £2.3m as a result of squeezed distribution. Nakd also lost shelf space, driving an 8.2% decline in its pack sales.

Clean labels

Indeed, for some consumers, clean labels are key. At least that’s the suggestion from Kellogg’s owned RXBar, which launched a quartet of protein bars into selected UK fitness facilities in February 2019. The bars, which claim to contain no more than four ingredients and ‘no BS’, have since rolled into Sainsbury’s, WH Smith and M&S.

As consumers scrutinise nutritional labels like never before, they are also starting to look for benefits beyond protein. Fibre is tipped to be the next big macronutrient, following NHS warnings that Britain is falling well below the recommended intake of 30g a day. To get ahead of the curve, many brands are launching high-fibre products. See Eat Natural’s Fibre Packed and Kind’s new wholegrain Breakfast Bars.

“One of the key call-outs we’re making with the Breakfast Bars is around fibre,” says Kind’s McManus. “Originally we were going to make the call on the back of pack but our research showed that gut health, gluten-free and fibre are the fastest-growing health conversations people over the age of 35 are having. It’s a rising trend.”

“Gut health, gluten-free and fibre are the fastest-growing health conversations”

In the case of Kind, these call-outs are fairly practical. Others in the market are making the proposition more emotional. Take General Mills’ gluten-free and vegan fruit & nut bar Lärabar, brought to the UK last year after the multinational bought the US brand back in 2008. While owned outright by General Mills, the fruit & nut bar brand has the look and feel of an independent player (check out the umlaut). A statement from founder Lara (no umlaut) Merriken on the brand’s UK site declares that a “sound mind and body are derived from food in its simplest state”. Plus, it’s gluten-free and vegan to boot.

This more emotional proposition is likely to hit home today, says Brown of General Mills. “The UK is a fragmented nation right now, what with issues like Brexit and climate change,” he says.

“Two-thirds of the UK population don’t think the country is currently living up to its values and one way this is manifesting itself is that consumers are more likely to buy brands they feel have a purpose,” Brown adds. “There’s a whole trend towards conscious consumption and at General Mills we feel that our scale can be a force for good.”

Plant-based credentials

It is fitting that Lärabar is vegan. Because for an increasing number of consumers, being a force for good means cutting back on animal products. Many brands say vegan enquiries dominate their interactions online (Kind says its seen a 500% spike in enquires of this kind in the past six months).

That’s persuading major players such as Trek to launch vegan lines and increase communication about their plant-based credentials in response.

Eat Natural even has a bar named Simply Vegan, which contains peanuts, coconuts and seeds, to appeal to this crowd. “We continue to see high-profile reports linking meat and dairy consumption to climate change,” says King. “2019 saw the release of two high-profile reports recommending curbs on meat and dairy intake for health and environmental reasons, from the EAT-Lancet Commission and the UN’s IPCC.”

So as consumers get more concerned about their impact on the environment, plant-based credentials are a sure-fire hit. For proof, look no further than the growth of the meat-free market, which shot up 18% to £474.5m last year [Kantar 52 w/e 14 July 2019]. However, the issue goes beyond just veganism, says King. He believes brands need to respond to this new attitude to consumerism on a wider level. “Authenticity is key, if brands are going to attract and hold on to today’s increasingly conscious consumers,” he says. “This applies to environmental and health claims.”

Therein lies a warning. Because while consumers are happy to swallow the higher calories of many of these ‘healthy’ propositions for now, it may not stay that way. That’s especially true as consumers pay more attention to nutritional labels.

“Authenticity is key if brands are going to attract and hold on to today’s consumers”

Boka founder Franco Beer believes many of the popular bars on the market fall short on their nutritional promises. He created Boka, which claims to be the only snack bar on sale in the UK to have achieved four green traffic light nutritional labels, to provide a genuinely healthier option.

“Nobody needs to eat a 300-calorie protein bar that’s 10% fat unless they are an athlete,” he says. “There is still too much confusion and that’s being exploited by slick marketing. If a product is made with date paste and contains 25% sugar or another is more than 10% fat, how can that be healthy?”

Dan Kaminski, head of product at sugar-free ice cream and brownies brand Wheyhey, makes a similar point. “The reality is that many ‘healthy’ products are actually not very healthy,” he says.

“Bars and bites with pressed fruits and nuts as the primary ingredients are naturally high in sugar, fat and often calories. But the consumer often doesn’t see past the ‘natural’ and ‘no added sugar’ call outs,” Kaminski adds. “In fact, a single serving can have over two-thirds of the recommended six cubes and comes very close to the sugar content of typical ‘unhealthy’ chocolate bars.”

Indeed, whether sugar is ‘natural’ or refined makes no difference to our bodies once it has been digested. And in other categories, consumers are avoiding all forms of sugar. After all, fruit juice has already faced it fair share of bad press, despite its sugar content being naturally occurring. Which raises the question: will we soon view the slick marketing of snack bar brands today in the same light as the ‘Mars a day’ line?

It might take a while. After all, Mars didn’t axe that slogan until 1995.

Why are the big players so slow on sugar cuts?

Sugar is a touchy subject for many of the big snack players. Sweetness is key to making shoppers want to buy products, but sugar has become public enemy number one.

“The government’s commitment to oversee a sugar reduction programme, announced in 2016, challenged the entire food industry to reduce sugar by 20% by 2020 in categories including cereal bars,” says Pia Villa, chief marketing officer at Graze. “This is something we took very seriously.”

Last April, the booming Unilever brand began a scheme that resulted in the sugar content of its cereal bars being halved, by replacing some with chicory root. The first reformulated product, Lively Lemon Flapjack, had its sugar content cut to 13%.

But the more sugar your products contain, the trickier it is to cut it without affecting flavour.

Snack bar brands would be wise to heed a lesson from the confectionery category, which recently saw the loss of Milkybar Wowsomes. Nestlé admits its axed the range, which contained 30% less sugar than standard Milkybar products, because it didn’t meet expectations on taste.

In spite of Wowsomes’ failure, it’s big suppliers like Nestlé that should be leading the way in weaning consumers off the white stuff, many believe.

But there’s a problem, warns Franco Beer, founder of Boka, which he claims is the UK’s only snack bar with four green nutrition traffic lights. “Innovation is really expensive and it takes time.”

Boka has been “talking to a large company about developing a green traffic light bar, and people are asking us about own label” he says. But for the majority of big companies, “it’s cheaper for them to tweak existing products and spend on marketing than do what is needed and develop new products”.

He adds: “That needs to change. The incentive needs to come from the government. Why not reduce VAT on healthier snacks to 10%?”

Innovations in snack bars 2020