Specialty Food Magazine

FALL 2017

Specialty Food Magazine is the leading publication for retailers, manufacturers and foodservice professionals in the specialty food trade. It provides news, trends and business-building insights that help readers keep their businesses competitive.

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FROM THE PUBLISHER Small Brands, Big Owners SPECIALTY FOOD ASSOCIATION MEMBERS: Discuss this topic in the Solution Center on specialtyfood.com O utpacing mainstream by a wide margin, specialty foods remain the fastest growing seg- ment of the food business. Some industry forecasts have them doubling their share of gro- cery shelf space by 2025. It's not surprising that investors are cultivating the market and funding growth for specialty food producers. While demand may put more specialty items on the shelf, investment, in the end, could make that shelf space less accessible to new brands. Chris Crocker Senior Vice President, Content & Marketing ccrocker@specialtyfood.com A large portion of the funding coming into the market is either in anticipation of or as the result of the sale of a specialty food business to a large consumer packaged goods company that has traditionally built its success on a pow- erful brand following, channel dominance, merchandising authority, and promotional support. Enter today's emerging consumer majority: They dis- trust major brands, seek authenticity over notoriety, and want to know where and from whom their food comes. Al- most everything about these consumers' attitudes and moti- vations leads them to purchase products that are very differ- ent in substance, style, and origin from mainstream foods. Recognizing that their offerings may not be well po- sitioned for this new consumer—and that they are losing ground to those whose are—mainstream food companies are investing in brands that can help them retain and regain shelf space. They are also investing in specialty companies to serve as product development incubators. Where they once acquired to integrate, they now acquire to differenti- ate: trying to retain an authentic look and feel to the pack- aging, a clean label, and—most of all—not even hint at the parent brand's identity on the package. We may wind up with a group of big companies— still with a lot of marketing, merchandising, and pro- motional clout—eventually running a bunch of small specialty companies. It is not hard to imagine that they would bring their marketing dollars to bear across cat- egories and price points, making it more challenging for independent brands to bring innovation to market through traditional channels. If there's one thing we've learned in the past few years, though, it's that today's consumers are anything but traditional in how or where they shop. And that can keep food discovery rolling along. FALL 2017 5 Where large brands once acquired to integrate, they now acquire to differentiate: trying to retain an authentic look and feel to the packaging, a clean label, and—most of all—not even hint at the parent brand's identity on the package.

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