Sales of condiments surged during the first year of the CODID-19 pandemic, growing 21.3% in 2020 vs. 2019. The category managed to maintain most of that growth, falling 1% in 2021 compared to its 2020 sales high. And while early sales data for 2022 shows that consumers are still interested in adding to their at-home condiment collections, brands need to put in more work in engage younger and more diverse audiences, writes William Roberts Jr., Mintel senior food & drink analyst.
US retail sales of condiments are expected to grow between 2-3% annually in the next 1-2 years to reaching $10bn by 2023, according to Mintel.
"Dynamic sales patterns (with stunning gains followed by less dramatic declines) indicate that frequency increased and, for many brands and segments, has lingered, as at-home meal occasions remain somewhat elevated for at least the near term," said Roberts.
"2022 is a good time for condiment brands to lay the foundation to further extend their pandemic gains, while addressing challenges to the future market."
Older consumers 'more likely to consume periphery' condiment segments
Despite more global and cultural diversity hitting the condiment set including Filipino-American sauces, marinades and jams, kimchi mayo, and curry ketchup, targeting younger consumers is a still a largely missed opportunity, noted Roberts.
"Younger consumers under 45, need some attention; they are less engaged than their older counterparts," he said.
According to Mintel, consumers over the age of 45 are more likely to have six or more condiments in their pantry whereas consumers under the age of 45 are more likely to have fewer than six product types.
"While older adults are more likely to stick with the classics, they are also more likely to consume the periphery segments: horseradish, olives, and relish. This identifies two needs for the under-45 market: raising engagement in the traditional go-to condiments, and also with less-traditional condiment types," said Roberts.
Learning from foodservice
To engage younger consumers, Roberts suggests looking to the foodservice industry for inspiration.
"Millennials and Gen Z are dedicated foodservice patrons and well-documented self-professed foodies. Brands can turn to foodservice operators to address both needs in furthering engagement with condiments among these consumers – using menus for inspiration in flavorful product development, or pairing ideas to extend product versatility with elevated versions of mainstream options like sriracha ketchup, chili lime mayo and beer or chili honey mustard," he said.
Roberts added that brands can work with foodservice operators to drive awareness for less-explored condiments through new menu offerings to stoke consumer creativity once they leave the restaurant setting and inspire new condiment applications at home.
Highlight condiment versatility
Sharply rising food and drink prices are prompting consumers to reconsider necessary vs. indulgent grocery items and condiments tend to sit in a precarious middle ground, noted Roberts.
"Consumers are at a crossroads: grappling to balance new routines with rising prices, and eagerness to simply explore and indulge a little," he said.
"Consumers are much more likely to try to find savings through stock-ups and reduced dining out, followed by channel and brand shifts, rather than through overt attrition of packaged foods and drinks."
To better reach consumers, condiment brands should highlight the versatility of their products that can be used in a wide range of applications.
"Nearly three quarters of category participants prefer condiments that can be used in a variety of ways, and more than half would like to see more suggestions for using condiments in recipes," said Roberts.
'Almost half of adult consumers under 45 seek condiments with restaurant-centric flavors'
Additionally, emphasizing flavor and convenience is another way to effectively engage consumers, especially younger generations.
"Flavor is essential to product choice in the category and a likely catalyst to draw enhanced engagement and build loyalty among younger adults," added Roberts.
"Almost half of adult consumers under 45 seek condiments with restaurant-centric flavors, reinforcing the notion that flavor exploration can stimulate both consumers and brands in the category."
Cleaner formulations
For parents, a significant segment of the under-45 crowd, cleaner formulations are an emerging priority when it comes to their households, added Roberts.
According to Mintel, nearly a third of new product launches in 2021 carried cleaner formulation claims such as “no artificial ingredients” or organic. Interest in low/no positioning significantly outranked supplemental claims, such as protein or fiber, Mintel found.
"Still, condiments do not have strong associations with health; more than four in 10 consumers agree that most condiments are unhealthy and that long ingredient lists are often the culprit," said Roberts.
"While brands will need to keep their primary function of taste in mind, a refreshed approach to conveying health may be warranted to engage younger adults."