Boost Flavor, Value and Sales

Consumers who routinely prepare meals at home can transform ho-hum protein and vegetable dishes into mouth-watering restaurant-quality fare by incorporating a wide variety of sauces and marinades. But dollar sales within the total cooking sauce, marinade and spice segment are projected to grow slowly between 2014 and 2019 — from $9.6 billion to $10.4 billion, forecasts the December 2014 “Cooking Sauces, Marinades and Spices — US” study from Mintel, a global market research company.

Consider trends and drivers

A dichotomy of trends is impacting sales within these categories. Slow retail growth is forecast because pre-packaged products are considered overly processed by many consumers who are increasingly demanding fresh, unprocessed foods.

And reduced global meat consumption resulting from religious, ethical, environmental and economic impacts threatens to undermine cooking sauce use in developed markets, says Todd Mullane, director of private label foods for LiDestri Foods Inc., Fairport, N.Y. Few North American and European cooking sauces are positioned as suitable for vegetarians or vegans.

“This is an opportunity for U.S.- and North American-based food brands,” he adds.

Demand for unusual products featuring complex, intense flavors is another driver. More organic and vegan bottled sauces are being introduced, points out Denise Purcell, head of content for the New York-based Specialty Food Association (SFA). Several pasta sauces in the associations recent annual sofi Awards competition contained kale, including the pasta sauce category winner: Pumpkin and Kale Alfredo Sauce from Lynn, Mass.-based Sauces ‘n Love.

Diversification, customization, fragmentation, points of differentiation and clean labeling are also driving sauce and marinade growth, Mullane says.

“Millennial are interested in quality and [are] on a tight budget due to socioeconomical circumstances,” he adds. “Where sauce and marinade products offer a quality, inspirational and adventurous eating experience maintaining the healthy, clean label trust, product success can be achieved.”

Tap into opportunities

Retailers want to create unique, differentiated store brand sauces and marinades to help them provide a “halo image” for their overall private label brand offerings, says Thomas Ewing, director of channel businesses for Columbus, Ohio-based T. Marzetti Co.

“In the past, retailers wanted commodity items offering value,” he says. “Todays retailers are becoming more marketing than operations oriented; they want differentiated products. Many retailers with successful private label programs are using these categories to create excitement around their own brands.”

Store brand sauces and marinades must speak to consumers.

“The more retailers can use their [store] brand to connect with consumers, the more loyal their consumers will be to their brand,” Ewing says.

Products with easy-to-pronounce ingredients that don’t sound like chemical compounds are preferred by consumers and also perceived as being higher in quality, Mullane adds. “Products sweetened with real fruit purees or other natural ingredients will be seen as higher value,” he adds. “Organics, GMO-free, free trade, Rainforest-certified, plus gluten-free, sustainably produced-and-packaged [products] have a halo with today’s consumers.”

Create spot-on packaging

During the past decade, a plastic packaging movement has been building as glass packaging has become more difficult and expensive to use. PET packaging has improved and become more complex, featuring better barrier properties.

“[Improved] PET packaging is clear and results in the visual impact of glass,” Ewing says.

Many consumers now prefer PET jars, as they help keep the price of budget-minded products low and are much less likely to break than glass packaging, Mullane says, citing 2014 findings from London-based Euromonitor International.

Packaging also must be convenient to use and offer features such as no-drip or flip-top cap improvements or bottle design enhancements that make the package more attractive or easier to handle, Ewing says.

Quality and convenience remain primary drivers for shelf-stable sauces and marinades, while 100 percent recyclable packaging is a secondary driver, LiDestri Foods research reveals.

“Short-cut cooking and life-hacks are an important trend for the millennial family” Mullane adds.

And recipes on labels help consumers understand how to use these products.

“Store brand product labels must convey confidence to consumers that they will enjoy the product just as much as a more expensive branded product,” Ewing says.

Companies such as New York-based Victoria Fine Foods have redesigned their labels to feature ingredients on the front of the package, where shoppers can easily see them on the shelf, adds SFA’s Purcell. More brands, including store brands, may want to take this route.

Position them to sell

When it comes to merchandising store brand sauces and marinades, retailers should consider combination displays near companion products such as meat or fish.

“Demonstrate you’re proud of your product and [create] an impulse for the consumer to buy it,” Ewing advises.

Cross-merchandising outside of the center store, in combination with sampling, also is effective in attracting sales, Mullane adds. Retailers should consider pairing natural combinations, too.

“Combining Asian sauces, grilling sauces and Mexican sauces [with] vegetables and protein is a trend that is healthy, exciting and inspirational,” Mullane says.

Prepare for the future

Despite conflicting trends, expanding and evolving flavor palates should increase consumer use of cooking sauces, marinades and spices to further customize home-cooked meals. Millennials and households with children are especially important to these categories, Mintel states.

“Brands [including store brands] must continue providing new and unique flavors to draw consumers, and they must also offer more healthy products such as all-natural, organic and low/no sodium, fat and sugar to attract more users — especially millennials, who avoid processed foods and seek fresher/healthier ways to customize food made at home,” states Amy Kraushaar, Mintel’s U.S. category manager – food and drink and foodservice.

Expect store brand sauces and marinades to continue increasing in variety and enhanced quality.

As retailers continue consolidating and want to attract high-end consumers, they’re going to continue building products high-end consumers will want, as well as national brand equivalent (NBE) items value consumers look to buy, Ewing says.

“The knockoff and the discount to the NBE price is surely a value proposition to consumers as long as consumers trust that value,” Mullane says. “In the current situation, many store brands are surpassing the value proposition of national brand equivalents. Store brands now have the flexibility of offering organics, GMO-free [and] premium and unique ingredients.”

For forward-thinking retailers, the possibilities to boost store brand sauce and marinade usage and sales are only limited by the imagination.

Do consider demand for unusual sauces and marinades featuring complex, intense flavors.

Don’t ignore the needs of vegetarians and vegans in product development.

Do offer features that make the packaging more attractive or easier to handle.

Don’t limit sauces and marinades to center store; merchandise and sample them with complementary items.