Cadbury hooks up with Snapchat

Cadbury TimeOut is getting creative on Snapchat in a campaign to engage young consumers in the next installment of Mondelez and Carat’s Media Innovators program.

The campaign integrates popular social media platform Snapchat with a consumer promotion, asking consumers to ‘snap’ a TimeOut bar, awarding a prize of $10,000 to the most creative snap.
 
New York based street artists Yok & Sheryo are also providing creative inspiration via three pieces of street art visually dramatising the TimeOut moment, which will be featured on street posters alongside a blank canvas ready for passers-by to snap.
 
TimeOut has partnered with VICE’s in-house creative agency Virtue for the multi-channel campaign that utilises OOH posters, Youtube, VICE Discover, the VICE media network and other digital lead channels to create new found awareness for the much loved chocolate bar.
 
Dwayne Hutton (Brand Manager – Cadbury Bars) at Cadbury said: “The TimeOut chocolate bar is all about encouraging you to take time out and enjoy it!  This fits perfectly with the behaviours of using mobile devices and being active on social media.”
 
“It’s very exciting to be innovating with media and activating on Snapchat for the first time, seeing TimeOut on Snapchat might come as a surprise to some consumers, so we are very excited to see how creative they’ll get with their snaps.”

The campaign is part of the Media Innovators program, which Mondelez has run in partnership with Carat, and involved brand managers pitching their ideas to an expert panel in a bid to win a share in $1 million of advertising budget to turn their campaigns a reality.
 
This TimeOut, Snapchat and VICE activation follows a number of successful Media Innovators campaigns, including Picnic with Tinder and NOVA.
 

Its Tim Tams at 10 paces: Round 1 goes to Arnotts

According to a number of media reports, Coles has lost Round 1 in its Mexican standoff with Campbell Arnott's, with the supermarket giant accepting price rises on dozens of products after the biscuit maker held its much-loved Tims Tams hostage.

Campbell Arnott's warned Coles earlier this year that due to increased production costs, it planned to lift its prices by between two and 10 per cent on a range of common biscuit snacks, including Tim Tams, Scotch Fingers, and Monte Carlo biscuits.

In what could only be described as crumbling in the face of a more powerful brand, Coles had little choice but to accept Arnotts's demands.

A Coles spokesperson said: “Coles has made a commitment to bring down the cost of shopping for our customers, and we have been doing that every year for the past six years.”

“So when a major international manufacturer decides they will unilaterally force through a price hike without justification, we will resist that.”

This chocolate-encrusted standoff lasted for almost two weeks before Coles caved in and agreed to pay an increased price on 44 Arnott's biscuit lines.

However the bean counters at Arnotts didn’t have it all their own way as Coles has refused to pay more for 14 other products, which have since been removed from its shelves. 

This includes six varieties of Tim Tams, including a range of flavours designed by Adriano Zumbo as well as other well-known Arnott’s biscuit varieties.

“Our average family shopper spends around $150 per week on food and groceries, and they don’t have the spare cash laying around to give to Campbell’s-Arnotts every time they decide to put their prices up,” noted the spokesperson in an attempt to explain this move.

So while Arnott’s may have won this round, the fact remains that Coles has also used the power of its brand and shelf space to show the biscuit maker that it will not tolerate being held to ransom.

The deleted biscuit lines are:
 
Tim Tam Zumbo Coconut Cream 165 gram
Tim Tam Zumbo Choc Raspberry 165 gram
Tim Tam Zumbo Salted Caramel 171 gram
Chocolicious Tim Tam Multipack: Caramel 191 gram
Chocolicious Tim Tam Multipack: Dark 187 gram
Chocolicious Tim Tam Multipack: Original 187 gram
Twisted Faves Monte Carlo: Salted Caramel 250 gram
Twisted Faves Shortbread: Strawberry Cream 250 gram
Arnott's Chocolate Biscuits: Royal Dark 200 gram
Arnott's Cheeseboard

 

ACCC slugs Arnott’s $51,000 for ‘misleading’ fat claims

Arnott’s has paid penalties totalling $51,000 following the issue of five infringement notices by the Australian Competition and Consumer Commission relating to representations made by Arnott’s about its Shapes Light & Crispy product.  Arnott’s also provided a court enforceable undertaking to the ACCC.

The ACCC said that Arnott’s represented on the packs of four varieties of Shapes Light & Crispy and a multipack between October 2014 and July 2015 that Shapes Light & Crispy contained “75% less saturated fat” than Arnott’s’ original Shapes biscuits, when in fact it contained approximately 60 per cent less saturated fat than original Shapes.

In making the “75% less saturated fat” representation, the ACCC noted that Arnott’s was actually comparing its Shapes Light & Crispy product not to original Shapes but to potato chips cooked in 100% palm oil. This was included in a fine print disclaimer at the bottom of the packs. However, even if potato chips had been an appropriate comparison for the saturated fat content of Shapes Light & Crispy, the ACCC notes that since only around 20 per cent of potato chips sold in Australia are cooked in palm oil, the representation may still have been misleading.

“Consumers should be able to trust the claims that businesses make to sell their products. Small print disclaimers cannot correct false or misleading representations which are made in a prominent way in advertising or on packaging,” ACCC Chairman Rod Sims said.

“Businesses must ensure that any comparison claims they make are accurate and based on meaningful comparisons for consumers. This is particularly the case regarding claims that involve healthier eating.”

“Truth in advertising, particularly where misleading claims are made by large businesses, is a priority enforcement area for the ACCC,” Mr Sims said.

The ACCC issued the infringement notices to Arnott’s because it had reasonable grounds to believe that Arnott’s made a false or misleading representation about the composition of Shapes Light & Crispy, in breach of the Australian Consumer Law.

Arnott’s has provided a court enforceable undertaking to the ACCC that it will not engage in similar conduct for a period of three years. It will also publish a corrective notice on its website and in the nationally published Foodmagazine.

Pepsi and Coke battle over Chobani

According to a Reuters report this morning, PepsiCo and Coca-Cola are in talks to invest in Chobani for as much $USD 3 billion for between 10 per cent and 20 per cent of the yogurt maker's equity.

Chobani is looking for a strategic investor to help expand its supply chain, distribution, manufacturing base and geographic footprint for its popular yogurts like Flip, which combine yogurt with flavors such as peanut butter and coffee, the Reuters report said.

Chobani was founded in 2005 by Turkish immigrant Hamdi Ulukaya. 

While its yogurt has become one of the top-selling yoghurt brands in the United States, Chobani has also experienced some growing pains, with private equity firm TPG Capital LP giving it a $USD750 million loan last year to help it fund a turnaround.

What Might Be the Impact of an Australian Soda Tax?

What Might Be the Impact of an Australian Soda Tax?

By Howard Telford, Senior Industry Analyst with Euromonitor International

With the implementation of high profile sugar and soft drinks taxation in France in 2012, in Mexico in 2014 and Berkley, California in January of this year, the global debate concerning the purpose and efficacy of excise tax proposals on sugary beverages is inevitably moving in to other high per capita markets for carbonates.

Presently, the topic is on the agenda in Australia, a top 10 market for carbonates consumption in terms of per capita retail volume sold, and yet another country where obesity and other public health concerns are driving interest in added taxation as a potential policy solution. Fifteen years of volume and value sales data for carbonated drinks in the Australian market, published as part of Euromonitor’s non-alcoholic drinks research program, allow us to speculate on the potential impact of a soft drinks tax by considering the historic impact that price increases have had on Australian retail sales of carbonates, with a focus on cola.

COLA AS A CASE STUDY
As part of non-alcoholic drinks research published this January, Euromonitor International employed an inductive demand model to aid in five-year forecasting. The forecast model attempts to identify several measureable and statistically significant demand factors (including retail price) from historic data sets of the 80 markets researched. These factors are tested against historically available data for retail and on-trade beverage category sales, and then weighted to assist in building 2015-2019 country forecasts.

Australia-cola-sales.png

For Australia, the results demonstrate that a 1% increase in the retail selling price of regular, full flavour cola carbonates can be expected to yield just a 0.2% decrease in retail volume. Consequently, even a relatively substantial (and hypothetical) 7% increase in pricing in 2015 would yield only half a percentage point difference in expected declines: from a 6.5% forecasted reduction in off-trade regular, full-flavour cola volume for 2015, to a 7.0% reduction in 2015 under a soda tax scenario.

Discounting other factors, this finding suggests a weak relationship between price hikes and volume declines in Australian standard cola. However, this finding is simply based on observable data from the market and should not be oversimplified. 

In constant 2014 Australian dollars, retail unit prices for cola carbonates (including regular and low calorie cola alternatives) have fallen consistently over the review period – by 17% in total over 2000-14. There is greater uncertainty over the impact of a substantial soda tax in Australia, because there is simply no precedent for a substantial price shock in the Australian retail market. Furthermore, the introduction of such taxation would necessarily be accompanied by a high profile health and public policy debate in the media that may further impact consumer attitudes and behaviours towards the cola and wider carbonates category for reasons other than simple price.

WOULD THERE BE A PUBLIC HEALTH BENEFIT TO A SODA TAX?
The policy argument for excise taxation on carbonates – or similar Pigovian taxation on other products, including alcohol and tobacco – is that taxes ultimately raise prices to the consumer, driving down overall consumption of unhealthy products. The low sensitivity of standard, regular cola retail volume consumption to changes in retail price in Australia and the relative importance of other demand drivers makes it difficult to draw hard conclusions about the immediate impact such a tax might have on consumption and health.

Additionally, as a developed soft drinks market, consumers in Australia have a wealth of diet, low-calorie, zero calorie, and other non-cola alternatives to replace regular cola carbonates in their diet. In fact, Australian low-calorie carbonates have gained considerably on regular cola over the review period. Crucially, for the first time in 2014, Euromonitor’s data suggests that low-calorie cola outsold regular cola carbonates in terms of retail volume in Australia.

We know that there have been substantial declines in standard, full flavour cola (down 22% in off-trade volume over 2000-2014) and wider carbonated beverages in Australia over the recent review period. Interestingly, these declines have taken place in an environment of flat or declining prices in real terms and have been accompanied by consumer migration to low calorie cola (and non-cola carbonate) alternatives. 

Recent volume declines, independent of observable category price increases, have had an impact on sugar consumption received from soft drinks, according to Euromonitor International’s Nutrition system. In 2011, Australians received an estimated 12.62g of sugar per capita, per diem from cola carbonate beverages. By 2014, this figure has fallen to 11.83g of sugar per capita, largely as the result of a 3% decline in cola carbonates retail volume over that same period. The amount of per capita, per diem sugar from cola carbonates is expected to fall to 10.28g by 2019, independent of excise tax legislation.

IS A SODA TAX NECESSARY?
It may be worth considering whether consumers in Australia – and indeed in many developed markets – are addressing well publicised concerns about the category by exiting cola for other alternatives, independent of price considerations and motivated instead by health or taste considerations.

There is a weak observable relationship in historic volume data between cola consumption and price in Australia. This is primarily because there is little precedent for substantial price increases in retail cola, supported by a strong consumer expectation for discounting that has kept the price environment in the category flat or declining. It may be the case that a substantial price shock could have a disruptive and unexpected impact on consumption. However, even in a low price, discount oriented environment for full flavour cola, volume sales have declined substantially as consumers migrate to alternative beverage categories, including low-calorie colas (led by the brands Pepsi Max and Coca-Cola Zero).

Cola consumption (regular and low-calorie) is expected to decline by 9% over 2015-19, with regular, full-flavour cola expected to decline by a staggering 25% in just five years, independent of any tax increase. Consumption of total carbonates is expected to decline by 5% in retail. 

While soda taxes will gather political and media attention as a response to public health issues across food and beverages, it is worth considering whether consumers are already responding to health concerns in their soft drinks, largely independent of price considerations. Regular standard cola carbonates in Australia have declined, to the benefit of low-calorie alternatives, with a positive impact on per capita, per diem sugar consumption.

Australia-Cola-forecasts.png

It is therefore worth wondering whether sugar and soda taxation proposals are seeking to address a health question to which the The chart above demonstrates this point clearly. In light blue, we have an industry demand model forecast estimate built only on core economic factors that influence consumer goods: population growth, average income growth, price and habit persistence (a lagged effect of growth in the previous year). If these factors alone were used to predict growth in Australian cola, a flat performance might be expected over the next five years. However, in dark blue, the actual published Passport forecast shows a CAGR of -5.4%, in stark contrast to the -0.6% CAGR expected by the industry demand model.

The consensus forecast is revised down by 4.8 percentage points to account for unmeasured factors outside the demand model, most prominently rapidly changing attitudes to health, sugar and lifestyles. These consumer-led factors are expected to be the driver behind declines in the Australian cola category. It is therefore worth wondering whether sugar and soda taxation proposals are seeking to address a health question to which the Australian consumer has already found an answer. consumer has already found an answer.

Mother Earth Fruit Sticks are back with less sugar

Mother Earth Fruit Sticks are back and are now with 25 per cent less sugar.

Ninety seven per cent fat-free and made with real fruit and now less sugar, the popular wholesome snacks are back on supermarket shelves. 

Made for younger children, the 19-gram bars are easy for little hands to grasp.  
They are also free from artificial colours or flavours, baked with wholemeal flour and filled with real fruit, making them an ideal tasty snack for between meals.

Mother Earth Senior Brand Manager, Caroline Potter said, “Like all Mother Earth products we use natural colours and flavours, and use simple, wholesome ingredients to give families something similar to a snack they would bake at home”

Red Rock Deli launches new range of Sweet Potato Crisps

Red Rock Deli, has released a new range of Sweet Potato Crisps. The new product joins Red Rock Deli’s existing range of Potato Crisps and Red Rock Deli Style Dips.

The new Red Rock Deli Sweet Potato Crisps are prepared using only the finest quality Australian sweet potatoes, according to the company.

Three flavour combinations are available – Roast Garlic, Rosemary & Thyme, Green Chilli & Coriander and Sea Salt.

“The success of Red Rock Deli has been built on providing unique tastes and textures with flavour combinations that capture our consumers’ imaginations. Our new Sweet Potato Crisps continue the brand’s journey of innovation and taste discovery,” said Robyn Quinn, Marketing Director, Red Rock Deli.

The company said that Red Rock Deli Sweet Potato Crisps are cooked in 100 per cent sunflower oil, and have no artificial flavours, preservatives or added MSG.

Seaweed: the next big opportunity in snacking?

Seaweed is a rare example of an opportunity to get in at Day One of a new growth market for snacks, predicts New Nutrition Business, with sales of seaweed snacks in the US already overtaking those of kale. 

“Launches of seaweed snack products are proliferating and sales outstrip those of kale, the trendy green vegetable that has benefited from a huge degree of hype since 2010 and has been embraced by young health-conscious urban consumers,” says Julian Mellentin, director of New Nutrition Business, which outlines five steps to creating a successful seaweed snack in a new report1. “Seaweed’s transition from the food fringes to mainstream will be propelled by snack products ,” he adds.

In the US, retail sales of seaweed snacks were valued at over $USD250 million in 2014, a year when market growth was around 30 per cent, and the last two years has seen a surge in launches of snack products with seaweed. 

Long a favorite of health-conscious consumers on the food fringes, seaweed’s “naturally functional” advantages – it’s a low-calorie source of protein and fiber, richer in trace minerals and vitamins than kale, and it ticks a number of free-from boxes – are winning it wider attention.

“Seaweed is a naturally-healthy plant-based ingredient, with a range of natural nutritional advantages and impeccable sustainability credentials,” says Mellentin. “These features are gaining it growing media coverage, and the attention of health-conscious consumers who are looking for an interesting new snack.”

In response to this growing consumer interest, snack brands have started to include seaweed in existing products, such as seaweed-flavoured rice chips, and there are also totally new brands that use a variety of seaweed types in inventive formats.

The new report sets out five steps to best position, market, price and distribute seaweed snacks in the US and Europe. The report provides practical insights for companies large or small aiming to create a successful seaweed snack brand. Snapshots of key brands provide real-world examples of products, marketing and communications for seaweed snacks.

 

Smith’s Chips factory in WA to close

Smith’s Snackfood Company will shut its Smith’s Chips factory in Canning Vale next year and, as a result, 300 workers will lose their jobs.

The West Australian reports that the company told workers the news at a meeting yesterday at 8am.

The job losses, which will be staggered until the factory closes for good late next year, will come from a range of roles including factory and administrative roles.

“Following a strategic review of its manufacturing operations across Australia, The Smith’s Snackfood Company has announced its intention to close its manufacturing facility at Canning Vale in Western Australia,” a Smith’s spokeswoman said in a statement.

 “This difficult decision was made with careful consideration, and The Smiths Snackfood Company will provide outplacement services and redundancy support to affected employees.”

The closure will not affect the company’s operations in the Eastern states.

The closure will also affect the Western Australian potato growers who currently supply the Canning Vale factory with about 12,000 tonnes of potatoes per year.

One such grower, Gary Bendotti of Bendotti Exporters told the ABC he had been supplying Smith’s for decades and the closure will hit his company hard.

Another grower, Manjimup Shire president Wade DeCampo told the ABC, "Smith's has been going through an Australia-wide review and Smith's is owned by Pepsico, which as we all know is a multinational in America and they take no prisoners unfortunately, and today we are being cut loose."

Tyrells Crisps buyout of Yarra Valley Snack Foods is a crafty move

UK premium snack brand Tyrrells Crisps has just acquired the Melbourne-based Yarra Valley Snack Foods in a move that will facilitate any attempts by the company to establish a manufacturing base in Australia.

In 2014, Lay’s (37%), Red Rock Deli (16%) and Kettle (15%) were the Top 3 players in chips in Australia, according to Euromonitor data.

Tyrrells, one of the largest producers of premium chips/crisps, reached an exclusive supply agreement with Coles and launched in Australia in 2014, so the company is not entirely new to the Australian market.

The chips/crisps category is worth over A$652 million, and represents 35% of the total value of the sweet and savoury snacks category, up from 31% five years ago despite the many advances in other (and healthier) snacking types.

The crisps/chips category has experienced 12% value growth during 2009-14, or 2% compound annual growth. In actual terms, its value growth for the period was only surpassed by extruded snacks, which are processed / reconstituted / shaped potato or cereal based snacks, such as rice cracker snacks, Pringles and Cheetos.

Tyrrells Hand Cooked English Crisps is perhaps the most well-known brand in Europe but there are many more out there, increasingly emphasising their hand-cooked potatoes and the place of origin the salt or vinegar is sourced from (eg Anglesey Sea Salt). Recently, PepsiCo has expanded into gourmet snacks through the launch of Market Deli – premium priced thick-cut crisps made from selected potato varieties bearing no sign of the company logo on the pack bar a small statement reading “from the Makers of Walkers”.

So is this emerging craft movement a fad or likely to be the next big thing in savoury snacks?

Tyrrells has grown at a 15% CAGR over 2009-2014 in the UK significantly outpacing the overall crisps’ CAGR of 5%. In Australia, Red Rock Deli from PepsiCo has outperformed the company’s flagship brand Lay’s over 2009-2014 in CAGR terms (5% vs 1%), though over the last two years sales have been falling.

The rapidly expanding craft beer movement is starting to exert an influence on the development of gourmet snacks, which are typically consumed with beer.

Borrowing from the craft beer market, crisps are becoming more sophisticated, with premium ingredients that emphasise heritage and provinciality.

Particularly in the US and the UK but also in Mexico and Russia, a growing number of beer companies are craft-branding their current line or coming up with new craft lines by acquiring small-batch brewers.

The definition of craft beer remains debated, but regardless, they are tapping in the same trend drivers. Some of the most recent examples include Immortal IPA from Elysian Brewing in the US which was acquired by A-B InBev earlier this year and Guinness Dublin Porter from Diageo which capitalises on Dublin’s brewing heritage in order to impart a sense of tradition and authenticity.  This has an obvious impact on retail sales.

Over 2009-2014, dark beer and premium lager, where craft beer is typically found, have outperformed beer overall globally, and particularly so in Latin America, North America and Australasia.  In Western Europe, growth in dark beer was undermined due to a strong decline in mass-market brands, which dominate the category.

The craft movement in beer has in turn facilitated a similar movement in crisps, particularly in the UK, where on-trade establishments have been switching from serving mainstream brands like Carlsberg beer and Walkers crisps to serving small-batch products like Brooklyn Lager with Tyrrells.