Savoury Snacks in Estonia

PROSPECTS

Traditional savoury snacks slow down

Certain savoury snacks categories like popcorn, potato and tortilla chips lost some growth momentum, as the general perception turned against them for their presumably harmful heat induced compounds that consumers perceive as possible carcinogens due to the widespread healthy nutrition campaigns and articles in the press. Potato chips previously clearly led savoury snacks but started losing popularity in retail stores.

Savoury snacks is challenged by demanding consumers

Savoury snacks products were never regarded as an adequate meal replacement and are linked mainly to entertainment occasions. Used predominantly at private and public parties, social gatherings, cinema or pubs, they are highly dependent on disposable income.

Savoury snacks retail distribution under greater threat from foodservice channel

Foodservice channels are of increasing importance to savoury snacks producers as with the growing income Estonians actively going out more to bars, pubs and cinemas, where savoury snacks dominate the menu. Local and international manufacturers rush to establish their positions in entertainment and foodservice outlets with supply of extensive branded product variety and advertising tools.

COMPETITIVE LANDSCAPE

PepsiCo Inc maintains top position in savoury snacks

PepsiCo Inc with its brand Lay’s maintains its lead in the category due to strong and intensified advertising and merchandising. Balsnack International Holding AS is among the top companies in the category, as the manufacturer found the key to success with the implementation of local ingredients, innovative recipe formulas and a wide range of products, actively advertised online and on social media.

Potato waffles successfully mix tradition and innovation

As the category needs innovation to attract the attention of bored consumers, some local manufacturers successfully took the initiative. Potato waffles were launched in 2017 by local manufacturer Balsnack International Holding AS and are a great example of a new development which gained immediate success in the domestic marketplace.

Private label faces adversity

As savoury snacks is concentrated in a few international and local players’ hands, who actively promote their products both online and via conventional media channels, there is little marketing support for private label primarily belonging to supermarket chains Prisma, Maxima, Selver and Rimi. In the review period private label products were mainly attractive for their budget price, but with growing purchasing power of Estonians they are likely to lose value share against innovative and fiercely promoted products over the forecast period.

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