Photo Courtesy of Bolthouse

Consumer demand for healthy, convenient meal options is helping transform the salad dressing sector. As shoppers demand fresh, simple ingredients, shelf-steady staples are moving into refrigerated produce space with updated flavors and packaging.

Shawn McLaughlin, Tessemae’s chief growth officer, reported a 5 percent increase in the Essex, MD-based all-natural salad dressing company’s refrigerated dressing category in the past year, driven by new consumers in search of organic, healthful options. These shoppers are on the lookout for easy-to-read labels and organic ingredients. While he notes many of Tessemae’s shoppers are going dairy-free, they still want creamy, satisfying flavors like ranch and avocado.

“Consumers want to be able to pronounce the ingredients in their products. Consumers are smart and asking questions about fillers like xanthum gum and maltodextrin. We believe clean eating is not a trend; it’s a movement,” says McLaughlin.

For young adults, both flavor and substance are important criteria. Millennials and Generation X-ers view fewer ingredients as an indication of more wholesome foods.

San Joaquin, CA-based Bolthouse Farms has seen its refrigerated organic dressing category grow 40 percent in the past year. Lauren Castillon, the company’s communications manager, says shoppers have become more conscious about reading nutrition facts. “Many are in search of fresh, organic options,” she says. “As consumers increasingly look for fresher, healthier options, they are also getting into the habit of turning the bottle over and reading the nutrition and ingredient labels. This ultimately impacts their purchase decisions. We’ve seen an increase in consumers not only looking for fresher, refrigerated dressings, but also those with lower calories and lower fat.”

With yogurt, Bolthouse has sought to satisfy consumer cravings for both healthy and creamy flavors. This has allowed the brand to update old favorites like ranch and blue cheese as low-calorie options.

Trends toward fresh, perishable ingredients have meant a slow-down for shelf-steady dressings, says Stacey Miller, business development director for Litehouse Foods in Sandpoint, ID.

“While claims such as preservative-free and no artificial flavors are important, taste is most important to the consumer.” Desire for fresh has driven young shoppers to a store’s perimeter, perusing refrigerated sections over store shelves, adds Miller.

Castillon points to consumer research indicating 78 percent of consumers are trying to eat more fresh food. The research found Millennials are twice as likely to shop only a store’s perimeter. “There is an enormous opportunity to work closely and collaborate with our retail partners to create great shopping experiences for customers that address their needs.  More traffic around the perimeter creates more opportunities to cross-merchandise fresh produce with different dips and dressings,” she says.

It’s a tactic Bolthouse Farms has successfully executed with its fresh-packaged carrots and refrigerated dressings. As brands like Bolthouse Farms introduce new refrigerated categories to the store perimeter, educating consumers about the product benefits and where to find these new items becomes important at the store level. Castillon encourages in-store efforts to promote education, recipe creation and sampling.

Convenience

With interest in healthful and natural ingredients has come a continued push toward convenience. This has translated into packaging innovations to serve busy, health-conscious shoppers.

“We definitely see more consumers wanting convenience, especially the Millennials.  While they are looking for convenience, they do not want to sacrifice flavor,” says Miller. “We are seeing more demand for cups and pillows, particularly in classic flavors. The consumer can grab a salad from the produce or deli departments and choose one of our dressing options to pair with their meal.”

In response to consumers wanting quick, healthier food options, Makoto Dressing, Melbourne, FL, has developed individual portion servings of its dressings. “Dressing packaging is trending toward the consumer needs of cost-saving, quick and convenient,” says Charles Blyer, sales manager. “The need for a more portable format has brought about innovative packaging, such as portion control and single-serve cups, packets and dressing lids.”

Partnering dressings with the value-added salad category has created a promising growth sector. According to Tessemae’s McLaughlin, the company has seen the value-added salad category grow 29 percent in the past year. “If you can offer the consumer a bundled package with dressing items and toppers, you will gain trial with the heavy salad users that halos back to the brand and the category,” she says.

Convenience has translated into packaging changes beyond single-serve portions. Tessemae’s, for example, removed its signature bottle wax to promote ease of opening. According to McLaughlin, the response has been notable with many accounts doubling in sales.

Bolthouse Farms has turned away from glass bottles, replacing them with plastic. This has allowed the company to implement high-pressure processing, which exposes products to an extreme amount of pressure from cool water and ultimately extends shelf life. “This process helps extend the shelf life and make the product safe to consume while preserving the great taste, nutrients and vibrant colors,” says Castillon.

Litehouse Foods, however, has taken a different path, turning more toward glass bottles. “Consumers are looking for sustainable packaging that also offers convenience. Millennials, in particular, favor glass bottles — specifically pourable bottles,” says Miller.

Retail Partnering

To encourage the success of new products, Blyer suggests working closely with retailers on planning and promotion. He points to the benefit of collaborating to improve shelf placement and create sales campaigns to promote new flavors. He says manufacturers need to work closely with retailers to ensure mutual success, introduce new products through promotion and improve shelf placement to make the new products more visible and accessible to consumers. Makoto works with retailers by focusing its new products and packaging geared toward the trends of the industry. “There is close collaboration with the retailers to promote dressings in the produce department, such as introducing new flavors geared toward Millennials and teaming up with retailers to offer the product at a temporary reduced price to familiarize consumers with new and exciting unique flavors,” he says.

Blyer says slotting fees can have a major impact on product showcasing, noting they often benefit larger manufacturers over small ones. This has created a disadvantage for small manufacturers, he says, and has complicated the introduction of new products.

Miller says working closely with retailers, especially around the holidays, to cross-promote products in the produce aisle can help maximize grocery store opportunities. “Our campaigns and promotions include in-store point of sale, including IRCs, shelf talkers and additional in-store signage with secondary displays.  We also support our programs through social and digital platforms such as Facebook, Pinterest and a blogger network,” she says.

Miller suggests placing products at eye level whenever possible. Placing similar segments together, like Greek yogurt with yogurt dressings, also helps promote sales. “Consistency is key; the more we can execute with in-store point-of-sale and can supplement with secondary displays, the larger lift we see. If a cross-promotion is in place, displaying the items promoted together always drives more sales.”

Rewarding consumer loyalty also pays off. Rather than relying on price promotions, McLaughlin encourages brands to pay attention to changes in consumer needs in order to execute appropriate product solutions.

Classic Flavors, New Twists

While Bolthouse Farms’ Castillon has noticed consumer interest in convenience, she says consumers are also looking to recreate classic, home-style flavors. The brand has turned its focus to consumers who don’t have the time to create such dressings at home by launching its first line of refrigerated dressings. Launched in February 2017, the line includes two yogurt-based dressings, avocado ranch and blue cheese, and two vinaigrettes, raspberry balsamic and Caesar vinaigrette. “All four flavors are crafted using simple, but culinary ingredients, such as asiago cheese, avocado and raspberry juice,” she says.

Tessemae’s has also recognized that its consumers — of which many are going dairy-free — are interested in creamy flavors like ranch, blue cheese, avocado ranch and Caesar. McLaughlin says the company sees an opportunity for the dressing category to complement diet trends like the Paleo diet and the Whole 30. “As shoppers search increasingly for clean labels, brands like Tessemae’s will have greater options to promote its dressings and sauces.”

Many young shoppers are looking for sauces that can spice up a meal and are finding an array of international flavors and new flavors, including sesame ginger, mango habanero and Sriracha lime.

Jumping on the trend, Makoto Dressing is adding flavors like ginger and wasabi to its line. Additional flavors, including honey ginger, vegetable sauce and teriyaki sauce, offer choices beyond salads and can be added to sauté kits. “Wasabi Ginger Dressing is a Millennial favorite; it has a zesty blend of ginger and wasabi that adds a zing to any dish,” says Blyer.