Better-for-you jerky takes a bigger bite of snacks market
Sales of jerky topped $1 billion in 2017, and the market is expected to grow 4.2% on an annualized basis through 2022, according to Project NOSH. Citing research from IBIS World, Project NOSH said much of the growth will be from natural forms of jerky, also known as artisanal or premium jerky, and increasingly available as products labeled organic, grass-fed and produced without antibiotics.
Although jerky and other meat snacks dominate the savory snacks category today — posting a 9% compound annual growth rate during the past five years — the segment has traditionally been limited to a handful of companies producing dried meat products. For example, Wisconsin-based Jack Link's Beef Jerky has held at least half of the market share in the category, Project NOSH reported. Other popular brands include Old Trapper Smoked Products, Oberto, Frito-Lay and Tillamook.
Jerky's profile started to change in 2010, Project NOSH said, when California-based KRAVE debuted its uniquely flavored meat snacks and marketed them as better-for-you because they were low fat, gluten-free, contained protein, were minimally processed and had no artificial ingredients. When Hershey bought KRAVE in 2015, product innovations started to appear — such as the KRAVE Bar and KRAVE Stick, which combine meat with dried fruit, grains, vegetables and beans.
Premium or artisanal jerky responds to growing consumer demand for high-quality protein and intriguing flavors, while providing a quick energy hit for the on-the-go snacker. Millennials, in particular, are driving the snacking trend, and they prefer less-processed items with lower sodium and more natural ingredients but with the taste and trendy flavors they crave.
According to a 2017 study from The Center for Generational Kinetics and sponsored by Amplify Snack Brands, 89% of millennials consumed one or more better-for-you snacks in the past week, while half of them drove at least five miles to purchase a snack they were craving. It found that 64% said they looked for fewer ingredients, and 79% said they had more trust in a packaged snack if everything on the ingredient list made sense to them.
Food makers are paying greater attention to the snacking trend and responding with products like jerky designed to attract this influential demographic. According to research from Technavio, global meat snack sales could hit $9.47 billion by 2021, which would be a 9.4% compound annual growth rate, reported Meat + Poultry. Those sales aren't happening only at supermarkets since convenience stores snagged 53% of meat snack sales in 2016. Roughly half of global meat snack sales are jerky products.
Besides Hershey, other CPG firms are getting into the meat snack segment. Last year, Conagra Brands, which owns Slim Jim's meat snacks, bought Thanasi Foods — the maker of Duke's meat snacks. General Mills acquired EPIC Provisions, a manufacturer of wild game meat snacks, in 2016, and Tyson Foods has its Golden Island premium jerky brand, which it acquired in 2014 with the purchase of Hillshire Brands. There also appears to be room for startups with craft-like products sporting creative names such as Perky Jerky, Fusion Jerky, Lawless Jerky and The New Primal.
While the segment continues to shake out, manufacturers are positioning themselves with healthier item launches, Project NOSH noted. Conagra brought out Slim Jim's Premium smoked meat sticks with all grass-fed beef and premium pork, while KRAVE switched up its ingredient sourcing in order to add free-from and grass-fed claims to the ingredient lists of its meat bar and stick products.
These elements are increasingly important to discriminating customers — including millennials, women and parents — who look at package labeling and want to see fewer processing ingredients and more natural ones, Project NOSH reported. When retailers look to stock jerky brands, they look for cleaner labels, just like retailers stocking any other popular food or beverage items today. It's no surprise that jerky, with its slimmed-down ingredients list, portability and hip new flavors, appears well positioned for future growth.