It seems the recent juggernaut Kraft created with its mini-munchies in the guise of 100 calorie packs has cooled off substantially. As Brandweek put it recently, “100-Calorie Packs Pack It In.”
Who can forget the excitement that was generated when 100 calorie Oreo Thin Crisps debuted in 2004? The product virtually built a new consumer product category, and we all know that doesn’t happen very often. According to the Brandweek article, Kraft notched $75 million in sales in the first year it introduced 100 calorie packs, per IRI and their data didn’t include Walmart sales.
Is it a surprise that Kelloggs and General Mills jumped on the 100 calorie bandwagon with entries of their own in the following year? Is it any wonder Kraft added more 100 calorie packs as time went on, including this year’s latest entry: Oreo Mini Cakesters?
Yet, according to IRI, for the 52 weeks ended April 19, sales in the category are down. To quote Brandweek: “Dollar sales of Kraft’s Nabisco 100- Calorie Oreo Thin Crisps, for instance, fell 30.5 percent to $16.7 million.” 
Tom Vierhile, director of product launch analytics for Datamonitor: “This has been a big trend the last couple of years, but has dropped off this year and at this point it looks like we’re going to come in below where we were last year”, he was quoted as saying. With 190 introductions of 100-calorie pack items last year and 68 more thus far this year, it appears product companies have hit the downside of the cycle.
According to Mintel’s research, cited in the article: “concerns about taste, price, sustainability and efficacy” are to blame. There’s a lot to be said for these insights. Especially in this economy. Firstly, small pleasures mean a lot when money is tight. Taste is key if consumers are going to reach for a snack now. 100-calorie packs like Oreos skip on the cream filling–an essential guilty pleasure that adds substantially to the taste, hence the experience.
But then, there’s the price factor. That’s a big consideration in a sour economy. Consumers instinctively know that small packs cost more. Thirdly, there is the question of all that packaging. Single serve portions present a lot of packaging that more environmentally-conscious consumers frown upon. Lastly, dietary concerns. It seems that some consumers are tempted to snack more simply because each small pack seems so low calorie!
While there has been a surge in recent years in smaller pack sizes for one and two-person households, that does represent a lot of extraneous packaging. With tighter purse strings in place now, and savvier consumers who have a better understanding of portion sizes as well as environmental concerns, I’m wondering whether the meeting of all these factors–in a perfect storm–are going to sound the death knell for small pack sizes.
Questions:
* Are you a fan of 100-calorie packs? If so, are you going to continue to purchase them or do you intend to put your own 100-calorie portions into seal-top bags to save money?
* Have you tried 100-calorie packs but found that you consumed more snacks simply because they represented fewer calories? Did you stop purchasing them as a result?
* How do you feel about the packaging issue where single packs are concerned? Be honest here: no one is going to pass judgment and I’d like to sincerely know where DF readers stand on this issue.
* Lastly, do you think all of this is “much ado about nothing”? That the 100 calorie snack pack craze has just run its course in classic fashion?
I’d love to hear from you.
Ted, I never understood the allure of the 100 calorie packs. I tried cookie and cheese cracker packs and found the taste bland and almost like chewing on flavored cardboard. So taste was a factor.
I believe another issue is expectations. If the package has a “brand name” but is a lite version, and then of course doesn’t deliver a similar taste as a full calorie version, then ultimately there is much room for disappointment.
For my decision making, would it not be better to eat 2 cookies (the real deal) than 20 lite wafers?
I suspect, Paul, that many consumers feel as you do about the “taste factor”. However, that may have been offset by the convenience factor. . .you know, grab and go. And then there is the low calorie factor. All of this was fine when consumers were flush with cash. Now, whether they have the money or not, there is a perception of being less affluent, so they’re less likely to purchase more expensive small pack items, in my view. DF readers may disagree and I welcome their POVs also.
I love what you said here, Paul: “I believe another issue is expectations. If the package has a “brand name” but is a lite version, and then of course doesn’t deliver a similar taste as a full calorie version, then ultimately there is much room for disappointment.” That is likely a major issue for many consumers. . .one that I touched on briefly. How about it DF readers?
Thanks, Paul, for weighing in. Good stuff.
The 100-calorie packs were a great idea! So great in fact, that as a consumer, I figured out that I could ::gasp:: read the nutrition label of the much-cheaper bulk items, deduce how much 100-calorie portions would be, and pack my own 100-calorie baggies.
Convenience over cost is what drove the success of 100-calorie packs. Now that cost is king, consumers won’t pay for the convenience. They want more for their $. When you start paying attention to the per-unit/ounce price on the grocery shelves, a consumer on a budget will actually feel aggression toward the maker. How dare they charge that much more for less?
Holly,
Great observations. Thank you. I think you’re right: convenience over cost when consumers aren’t counting pennies. And the reverse when times get tough. You stated: “They (consumers) want more for their $.” Right.
As to your question: “How dare they charge that much more for less?”, let me point out that the cost of separate packaging, advertising and marketing might account for part of that, as well as good old profit margins.
Thanks for weighing in, Holly.
Everything you’ve mentioned I would agree is a cause, but I’d also point out the Promotion “P” of marketing. I don’t think these companies realized they needed to put some marcoms weight behind this. “Oh, it’s only a package size change – we’ll just put it on the shelf and it will sell itself.”
Sometimes when you leave it to the consumer to do all the figuring out (esp in CPG) it doesn’t work so well.
That’s my one cent anyway (reduced from two cents).
Loved your sharp wit, Kevin.
“That’s my one cent anyway (reduced from two cents).” That’s good. May I borrow that line?
Actually, I think Kraft did a great job promoting the 100 calorie snack packs; especially when they first launched them. The created a category and demand for a new product, if you will. While a few companies offered snack packs for vending machines in the past, all of a sudden, supermarkets had them. I do think the 100 calorie snack message hit a chord with consumers, as well.
Having said that: once the category became established, Kraft and other companies that got into the fray probably didn’t promote these products as well as they should have. Hmmmmm. . .maybe they got a bit greedy and thought they’d just glom more margin by promoting less? Interesting idea. . .
Thanks, Kevin, for weighing in. I always appreciate your comments.
I think the 100 packs did really well initially because so many consumers have become very portion-conscious. There are so many products on the market that look like a single-serving size and are actually 2 or 3. So psychologically I think it was fast and easy and not outrageously expensive….until money got tight. Personally, I am always “surprised” when companies come out with products that are over-packaged. For these single servings to be successful, I think these companies need to express very strongly why a single serving pack is MUCH BETTER for me – than it is for me to buy a big bag of whatever snack – and quickly portion it out into a bunch of little Ziplock snack bags. The costs savings for me are huge if I do it myself. The big box will have details about portion size and calories.
I think the product guys should have used the same size box, about the same volume of contents and done something like 3 regular-sized oreo cookies to a pack. Plus, consumers are getting more health conscious and they’re not going to keep going in the direction of “light” means eat a lot more. I think they’re going to cut down on the “regular” and enjoy the taste. But then in Paris at a luxury seminar at L’Oréal a few months back – product managers were talking about how brand line extensions were going to be reeling back across the board.
Hi Kimberly,
Can’t disagree with the logic of many of your arguments here. I like your idea about marketers using the angle of helping consumers with portion sizes in a more concrete way. While full-size packages of cookies and snack foods list portion sizes on their labels, it would be helpful for them to suggest consumers bag their own single portions in Ziplock bags, wouldn’t it? It’s a marketing angle well worth exploring, because as you noted, many consumers are more portion conscious now.
You’re right about this, too. Consumer product companies are delaying many line extensions to save money now. Unless they think new products are going to add significantly to their revenues, much of what was planned for the pipeline is on hold for now. Can’t really blame these manufacturers since the economy is contracting at present.
Thanks, Kimberly, for adding some great thoughts to this post.