Prime time for hot dogs

July 15, 2011

Health claims become more important in shopper buying decisions for a category often associated with fun.

Hot dogs hit their stride this time of year when three seasons overlap: the peak of backyard grilling, the heart of the professional baseball campaign, and the start of football leagues and tailgating, a new American pastime. More than 40% of annual refrigerated frankfurter sales occur between Memorial Day and Labor Day, when four-week periods index as high as 142 (100=average consumption), according to Nielsen data for U.S. food stores.

On an annual basis, category dollar sales gains aren’t as high as they were in the recession, but they still have some snap. Refrigerated frankfurters posted 2.7% higher sales to $1.68 billion in U.S. food stores (reporting $2 million and over in total yearly volume), excluding supercenters, during the 52 weeks ended June 11, 2011. This occurred, however, on a 0.8% equivalized unit volume dip (EUV 16-ounce basis). All data is for pre-packaged UPC-coded products only.

This advance in the latest period was less than the 5.6% dollar sales growth two years ago, which came about when branded products grew by 4.5% and private label jumped by 22.1%. As consumers gained more confidence in the economy, however, brand sales once again drove the category and were up 3.0% while private label slid by 2.8% in the most recent 52 weeks, the Nielsen data show. Price affected the shape of these latest gains, since brand EUV was down 0.8% and private label EUV slipped by 8.2%.

Hot dog eaters are checking nutrition labels too. Frankfurters with specific health claims rang up impressive gains in recent years. ‘Fat presence’ claims posted 14.2%  dollar sales gains two years ago and 22.2% gains one year ago before pausing with a 0.1% gain to $183.3 million in U.S. food stores ($2 million and over in yearly volume), excluding supercenters during the most recent 52 weeks ended June 11, 2011, according to Nielsen LabelTrends data.

‘Preservative presence’ claims are on at least a four-year growth streak, up 15.2% a year ago and 69.2% to $83.2 million in the latest period, achieved on successive 17.0% and 51.0% EUV rises. ‘No MSG’ claims are also up at least four straight years, especially by 44.5% a year ago and 258.8% in the most recent 52 weeks; this occurred on consecutive 54.0% and 258.4% EUV gains.

‘Gluten-free’ claims are on a much smaller dollar base, but they’ve also grown for at least the past four years. Most recently a 131.5% jump took the segment to $7.8 million on a 229.9% EUV boost, according to Nielsen LabelTrends.

Viewing the category by meat type, the fastest-growing segment is angus beef/black angus beef, which has soared from under $1 million in dollar sales in the 2007 period to $81.5 million in the most recent 52 weeks on comparable EUV growth for four consecutive years. The two largest segments overall are meat/meat combo/beef and pork combo, up for three straight years, most recently by 1.9% to $719.5 million; and beef, which fell by 3.6% a year ago before edging back up by 0.3% to $640.7 million.