THE BACKGROUND
The pickles, chutneys and relishes sector is struggling to attract younger customers and to claw share away from own-label. Earlier this year, Branston launched an experiential drive through Big Kick in an attempt to drive sales of its pickled vegetables range. The investment was the biggest since the products' launch. A roadshow visited 38 Sainsbury's and Tesco supermarkets and 10 shopping centres across the country, asking people to submit pictures of themselves eating pickled onions to a website. The winner of the 'Branston Factor' received 拢1000.
If there is one time of the year at which the British like to tuck into traditional fare, it is Christmas. Consequently, November and December are the best-selling months for the pickles, chutneys and relishes sector, as shoppers stock up on accompaniments to their turkey leftovers and ham sandwiches.
However, overall sales in this sector have suffered from changing dietary preferences. Younger consumers are not regular purchasers of pickles and chutneys, and innovation has failed to revive the market.
Mintel estimates that the combined pickles, chutneys and relishes market will be worth 拢141m this year, meaning that there has been no significant growth in the sector over the past five years.
While chutney has grown modestly, this has not offset poor sales in the sour-pickles sector, which accounts for almost two-thirds of the market. The category is dominated by beetroots and onions, but these traditional foods do not tend to appeal to younger consumers brought up on more exotic food. The format has remained largely unchanged and has therefore failed to entice additional users. Pickled vegetables have also lost out to fresh ones, as the health lobby has promoted the five-a-day message to the public.
Nonetheless, such products are in a position to promote their healthy credentials. Pickled vegetables retain their vitamin content and are low in calories. They sit well in salads, and beetroot, in particular, could benefit from better promotion of its qualities as a 'superfood'.
The little product innovation that has taken place among pickles has been driven by supermarket own-label. This has included pickled infusions comprising different vegetables such as peppers and artichokes.
Marks & Spencer, meanwhile, introduced the concept of a 'fresh' pickle with the launch of an Olive and Pickle Selection which sold in the chilled section.
It is difficult, however, to create brand differentiation in the sour-pickles category, which has resulted in it being dominated by own-label, as it can undercut on price.
The decrease in the consumption of bread has also had a negative impact on pickle sales. Traditionally, sweet pickles, such as Branston, have been a staple sandwich filler or accompaniment, so a decline in sandwich-eating puts pressure on the category. In particular, the classic cheese and pickle sandwich is suffering, as people look to reduce their carbohydrate and fat intake.
Manufacturers will therefore be forced to find other eating occasions for their products that fit better with the changing culinary habits being adopted by the nation.
Premier Foods' Branston, which benefits from a sizeable and loyal following, dominates this category, accounting for more than 80% of sweet-pickle sales. The packaging of its relish variants was redesigned earlier in the year, making them available in top-down squeezy bottles. The range of flavours was also expanded.
Chutneys, by contrast, have been buoyed by their association with Indian food, and the category has expanded to include more premium and specialist brands. They benefit from being used as an accompaniment to home-made and takeaway food.
Sharwood's is the leading chutney brand, with its mango variant accounting for about one-third of sales in the category. The brand has also introduced a squeezy-bottle format, as well as adding flavours, such as Bengal chutney, to the range.
Relishes are associated with barbecues, so the wet summer did not help sales.
The typical consumer of pickles, chutneys and relishes is between 35 and 54. While this group has increased in size recently, in the long term, it is set to decrease. Consumers aged between 15 and 34 - an expanding group - are less interested in the sector. The market has been over-reliant on older consumers and needs to tap into the eating trends of younger people.
Growth potential
On the upside, the low penetration means that if companies can position their brands to appeal to a younger generation and show them how to incorporate pickles and chutneys into their diet, there is significant room for growth.
Consumer research shows that women, families and ABs buy into the sector, but are more likely to be light users. Heavy users are typically men, C2DEs and retired consumers. Research also suggests that shoppers buying pickles, chutneys and relishes are interested in cooking, seek unusual flavours and are concerned about their health.
Sales in the sector are expected to remain flat over the next five years. Mintel predicts that in 2012, sales will be worth 拢144.2m - a rise of 2% on 2007. But if a wider base of consumers can be established, there is room for the market to expand.
PICKLE, CHUTNEY AND RELISH CATEGORIES BY VALUE AND MARKET SHARE
2007 2003 03-07
pounds m % pounds m % % chng
1 Sour 87 62 87 61 n/a
2 Sweet 28 20 31 22 -9.6
3 Chutney 18 13 18 13 n/a
4 Relish 8 6 7 5 14.3
Total* 141 100 143 100 1.4
Source: Mintel
* some totals are affected by rounding-off
SOUR-PICKLE BRANDS BY VALUE AND MARKET SHARE
2007 (est) 2003 03-07
pounds m % pounds m % % chng
1 Baxters 10.1 11.6 10.0 11.5 1.0
2 Haywards 7.7 8.9 10.8 12.5 -28.7
3 Garner's 6.9 7.9 6.9 8 n/a
4 Branston 5.2 6.0 n/a n/a n/a
5 Heinz 3.2 3.7 3.3 3.8 -3.0
6 Mrs Elswood 1.9 2.2 1.9 2.2 n/a
Others 12.8 14.7 14.7 17.0 -12.9
Own-label 39.2 45.1 39.1 45.1 0.3
Total* 87.0 100.0 86.7 100.0 0.3
Source: Mintel
* some totals are affected by rounding-off
PICKLE, CHUTNEY AND RELISH SALES BY RETAIL OUTLET
2006 2004 04-06
pounds m % pounds m % % chng
1 Grocery multiples & Co-ops 126 90 125 89.0 0.8
2 Independents 8 6 9 6.4 n/a
Others 6 4 6 4.2 n/a
Total* 140 100 140 100.0 0.7
Source: Mintel
* some totals are affected by rounding-off
RELISH BRANDS BY VALUE AND MARKET SHARE
2007 2003 03-07
pounds m % pounds m % % chng
1 Branston 3.0 37.5 n/a n/a n/a
2 Bick's 1.6 20.0 3.5 51.5 -2.9
Other brands 0.5 6.3 0.5 7.4 n/a
Own-label 2.9 36.3 2.8 41.2 3.6
Total* 8.0 100.0 6.8 100.0 17.6
Source: Mintel
* some totals are affected by rounding-off
ANALYST COMMENT - EMILY WOON, Industry analyst for packaged food, Euromonitor International
Pickled products have enjoyed a recent renaissance, with those manufacturers specialising in ethnic variants the greatest beneficiaries.
In the past few years, novel packaging formats such as top-down and squeezable bottles have gained popularity as consumers buy into the concept of products that are fun and time-saving. Manufacturers such as Tesco and Premier Foods, with its Sharwood's brand, have capitalised on this trend by offering a squeezable format for their mango chutney, for example.
The pursuit of exoticism, however, has been the most significant growth driver in pickled products. Fuelled by an increasingly diverse demographic profile and the rising popularity of long-haul holidays and travel-cum-cookery programmes, the British palette is becoming more open to a wider range of flavours.
Many consumers are no longer satisfied with standard pickle in their cheese sandwich leading to numerous flavour innovations in the category.
The rising demand for more exotic products has been a boon for ethnic brands. Patak's increased its share in pickled products by 0.7 percentage points between 2005 and 2006 - the biggest rise in the sector.
Own-label has been losing share to branded manufacturers since 2001, with the greatest decline - from 37% to 32% of value sales - occurring between 2005 and 2006.
This area is likely to lose further ground in the near future if competition from branded offerings continues to intensify. Manufacturers such as Patak's show no sign of easing up on their innovations, and are set to claim a bigger share of this lucrative market.