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Fresh Food

Refrigerated Dips Are Dressing Up Sales

As consumers seek out fresh foods, dips and dressings are soaring
Photograph: Shutterstock

What are your customers doing to dress up their salads and accessorize their snacks? Industry data shows the answer, in many cases, is buying refrigerated dressings and dips.

Total U.S. multioutlet sales of refrigerated pourable salad dressing were up 3% to reach $425.8 million in sales for the 52 weeks ending June 16, 2019, according to IRI, a Chicago-based market research firm. Refrigerated dips, meanwhile, gained a healthy 8.3% for  $1.1 billion in sales for the same time period.

Data from Chicago-based Mintel’s May 2018 U.S. Dips and Savory Spreads Market Report also shows the promise the diverse $4.6 billion dips and savory spread segment holds, due in part to the increasing popularity of snacking and brand loyalty. “All three segments of the category managed growth from 2016-2017, but refrigerated options have been especially successful as consumers seek out fresh foods,” the report said.

Planting an Impact 

U.S. retail sales of plant-based foods have grown 11% in the past year, bringing the total plant-based market value to $4.5 billion, according to recent data from The Good Food Institute (GFI) and the Plant Based Foods Association. Compare that to the total U.S. retail food market’s growth of just 2% in dollar sales during the same period, and it’s easy to see why plant-based products are becoming so important to grocery retailers.

Citing data from Chicago-based SPINS, which finds the $11.2 million refrigerated plant-based dips category growing at 91%, Mandy Bottomlee, director of marketing for Good Foods Group, is bullish about the future prospects. “With consumers adding more plant-based foods to their diets and seeking out better-for-you options, this category will continue to grow,” she says. “We see this as more retailers are increasing plant-based offerings to meet this growing demand.”

Pleasant Prairie, Wis.-based Good Foods Group has an ever-growing line of refrigerated offerings, including Avocado Mash, single-serve avocado packs; guacamole in Southwest, Sweet & Spicy, Chunky and Spicy flavors; and Queso, Buffalo, Avocado Pesto, Cilantro and Tzatziki plant-based dips. Queso and Buffalo have taken off rapidly, prompting an expansion of both lines this September.

Kristi Knowles, CEO of Toronto-based Reunion Foods Inc., maker of Mother Raw dressings and dips, is also optimistic about the plant-based category. “We anticipate the continued growth of plant-based bean dips, growth of both dairy and nut-based varieties and an ever-expanding flavor range,” she says.

Ithaca Cold Crafted Hummus

Photograph courtesy of Ithaca Cold Crafted Hummus

Plant-based dressings also are on a growth trajectory: The category generated $9 million in sales and was up 90% for the year ending April 2019, according to SPINS. Mother Raw is among the companies reaping the benefit of this upswing: “We are seeing growth of refrigerated dressings,” Knowles says.

Industry leaders believe it’s just the “dip” of the iceberg.

“This is just the beginning of a massive growth period for plant-based foods,” says Caroline Bushnell, associate director of corporate engagement for The Good Food Institute in Washington, D.C. “This growth will continue as more companies bring next generation innovations to market that really deliver on the most important driver of consumer choice: taste.”

“Plant-based foods are a growth engine, significantly outpacing overall grocery sales,” echoes Julie Emmett, senior director of retail partnerships for the Washington, D.C.-based Plant Based Foods Association. “We are now at the tipping point with the rapid expansion of plant-based foods across the entire store, so it is critical for retailers to continue to respond to this demand by offering more variety and maximizing shelf space to further grow total store sales.”

Keep It Fresh and Clean 

As more consumers seek products with natural, organic and/or “clean label” claims, retailers would be wise to consider the ingredients in the dressings and dips they’re considering before committing them to their refrigerated cases. Rockville, Md.-based Packaged Facts, for example, reports an uptick in sales of organic foods in their share of market basket space, as well as an increase in the number of products with clean label claims.

“We know 75% of consumers want snacks that are guaranteed fresh, and that consumers are avoiding preservatives and additives,” Bottomlee says. Health and wellness snacking (natural/clean) is expected to reach $20 billion from 2015-2020, with fresh snacking leading, she says, citing Mintel data.

Companies that make and market refrigerated dips and dressings are capitalizing on that trend.

Knowles says Reunion Foods’ 2017 research showed that 43% of salads are consumed with homemade dressing, and 92% of those are made with extra-virgin olive oil.

U.S. Refrigerated Plant-Based Dressings & Dips (dollar sales in millions)

Source: SPINSscan Natural and Specialty Gourmet, SPINSscan Conventional
* Year ending April

“Our hunch is that consumers are making their dressings at home because they’re not satisfied with the ingredients in the products available on shelf, along with the fact that they’re over-processed,” Knowles says. Consequently, Mother Raw now makes dressings with herbs, apple cider vinegar, garlic, onion and lemon juice—“the kind of  ingredients you’d find and use at home,” she says.

Pete Loizzo, founder and president of Ithaca Cold Crafted Hummus, admits that overall category growth of hummus has slowed. That, he says, is why brands are hopping on trends such as dessert and fruit hummus—and getting “mixed results.” Concentrating on quality ingredients is the Ithaca, N.Y.-based company’s primary focus, which dovetails with consumers’ increasing penchant for “clean” ingredients.

“Our strategy is to elevate mainstream flavors with premium, fresh ingredients. Fresh-squeezed lemon, for example, gives Ithaca products a uniquely fresh flavor,” says Loizzo. Ithaca’s Lemon Garlic flavor hummus has always been its flagship product, with Lemon Dill “a very close second,” he says. A new Kalamata Olive flavor is coming soon.

Mother Raw employs a similar strategy. “We go the distance by sourcing superfood ingredients [such as] hemp seeds and chia seeds to amp up the nutrients and add versatility and delicious flavor,” says Knowles, who reports that the company’s “vegan takes on traditional dips and dressings” are most popular. “We’re also noticing the interest in Japanese/Mediterranean and Italian varieties as consumers explore the globe and request more flavor variety in their dressings.”

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