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Aug 14, 2024
The snack-ification of Americans’ diets isn’t going anywhere Mars will purchase Kellanova, the maker of popular snack brands including Cheez-It and Eggo, for about $36 billion.
Mario Tama/Getty Images
Packaged food retailers are adapting to the increasing number of people using GLP-1 drugs like Ozempic and how those folks are tending to snack less. But Wednesday, there was a sign that big brands still see the value in a strong snack portfolio: The candy giant Mars, maker of M&M’s and Snickers bars, announced it’ll acquire Cheez-It and Nutri-Grain parent company Kellanova.
It’s a $36 billion bet that the snack-ification of Americans’ diets isn’t going anywhere.
The snack industry really hit a high a couple of years ago, said food service analyst Sally Lyons Wyatt with Circana.
“I would say ’20 to ’22 were really strong snacking years,” she said.
That’s when we were stuck at home because of the pandemic and reaching for comfort foods, like pickles and Goldfish. (Not that I’m speaking from experience.)
But even after Americans returned to school and the office, we were still snacking for convenience.
“The pandemic was catalytic in a lot of ways. This is just a change in kind of a culture of food,” said Michele Scott, associate director of food and drink at Mintel. She said millennials and Gen Z especially are embracing grazing.
“I think TikTok calls it “girl dinner ” where you have, like, a handful of snacks to make a meal, so maybe a yogurt and a cheese stick and crackers,” she said.
Because, Scott said, that’s quicker and easier and sometimes cheaper than preparing three square meals.
Inflation has taken a bite out of snack sales, said Lyons Wyatt at Circana. But snacks can also be a stand-in when we’re skipping bigger purchases, like going out to eat.
“It costs a lot to go do things these days. But you can maybe spend three bucks to go buy something new that looks fun and exciting that’s gonna delight your day,” she said.
The Mars-Kellanova deal and other recent mergers show food companies are banking on these trends and, said Christine Cochran, CEO of trade group SNAC International, catering to shoppers like her.
“My oldest son is a pretzel devotee and my daughter and younger son are chip fanatics,” she said.
Meanwhile she’s really into plant-based puffs right now. And that aligns with the direction a lot of brands are moving: growing their share of the snack aisle with healthier or at least more diverse options.
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