By offering a rotating selection of both hot to-go and prepackaged soups, delis can capitalize on this profitable segment.
With colder weather, hot comfort food sales tend to spike, and there is no better time to reevaluate a department’s soup selection.
According to Heather Prach, vice president of education at the Madison, WI-based International Dairy Deli Bakery Association (IDDBA), beef-based soup is down significantly in both dollar and unit sales. Chicken-based soups, however, are thriving.
“Chicken is the strongest protein over pork or red meat,” Prach notes.
The IDDBA reports that while chicken soup unit sales are up 2%, cheese soup unit sales have been flat, with a .7% decrease. The biggest growth is in vegetable soups, which showed 6% growth in unit sales.
“There is a comfort level with cheese and creamy soups, which are on trend with overall deli and bakery trends,” Prach explains. “When people eat out, they want indulgence. These varieties provide that.”
While Asian fare is trending overall in deli, this is not translating to the soup wells.
“It would seem Asian soups, like ramen and pho, would be hot due to the popularity of these types of grab-and-go meals, but we’re not seeing this with soup,” says Prach. “Still, there may be opportunity in adding these varieties to the department’s soup offerings.”
In the deli, IDDBA reports there is a .6% increase in soup unit sales year over year. Yet, some soup suppliers are seeing a boom.
“For the last six years, we’ve seen our soup sales increase 200%, and in the next four years we anticipate it will increase 55% and be a billion-dollar category,” says Bob Sewall, chief customer officer/executive vice president for Blount Fine Foods, based in Fall River, MA. “Most private label soup sales where we category manage are up in sales.”
FORMATS & FLAVORS
Part of the soup category’s growth is due to flavors, varieties and ingredients that are on trend.
“There is room in the soup section for another premier line, and we’re filling that void with an upscale product,” says Sewall. “In tough economic times, soup is affordable and nutritious.”
Lynn, MA-based Kettle Cuisine’s bulk and retail-packed fresh soups offer retailers multiple selling opportunities.
“Shoppers can pick up chilled soups in single- and family-serve sizes to stock their refrigerators for meals throughout the week,” says Kyle Callahan, the company’s director of retail sales. “They also have the option to buy hot soup to enjoy on-the-go through retailers’ self-serve wells or at the prepared foods counter.”
Kettle Cuisine and other soup suppliers take current trends into consideration with new product rollouts.
“Some of our recent launches with top mass and club accounts include a fantastic Tuscan Potato & Herb soup, which provides vegetarian consumers with a delicious option, and a flavor-packed Black Bean and Corn with Spicy Chorizo,” says Mike Seeger, Kettle Cuisine’s vice president of sales.
Fortun Foods, based in Kirkland, WA, founded Stockpot Soups, then sold it to Campbell’s in 1998 and recently was able to get its brand name back. “Stockpot Soups still has the original founder at the helm, Kevin Fortun. He was the trailblazer for the fresh soup category. Today, we are still innovating new products of the highest quality. We prepare only with fresh ingredients, not frozen,” says Mary Shepard, director of sales/partner, Fortun Foods.
Shepard says Fortun uses chef-inspired cooking in small batches to extract the flavors slowly.
Stockpot Soups will be rolling out new flavors to meet those high standards. Flavors include Avgolemono Greek Lemon Chicken Soup, Thai Coconut Lime Soup, Beef Stroganoff Soup and Lentil & Sweet Sausage with spinach. Stockpot also has a line of fresh retail soups that consists of Seafood Chowders, Comfort Flavors and Chili.
The Matzo Project, headquartered in Brooklyn, NY, offers packaged soup that takes 30 minutes to prepare.
“We wanted the flavor and color to be all natural, and we include bits of carrots, dill and other herbs chopped up,” says co-founder Kevin Rodriguez. “To do that naturally and have real ingredients was a challenge, and we tasted every broth and bouillon we could find. This is a vegan broth with no chicken.”
TALKING TRENDS
As the trends continue to evolve, soup flavors rotate in and out of favor.
“We’re seeing comfort food flavors and sustainable ingredients are trending,” says Sewall at Blount Fine Foods. “Our Panera Street Corn Soup has been a big seller recently. It’s vegetarian but there’s so many ingredients in it that it’s more like a stew than a soup. It’s low-fat, as well. Street corn is a big trend right now.”
The Blount Family Kitchen line offers a number of other indulgent flavors, including creamy chicken and wild rice, lasagna soup and baked potato soup with bacon and cheese.
Seeger at Kettle Cuisine predicts the company will move into a soup kit-type format soon.
“This would be an exciting way to bring more restaurant-style soups to the retail space,” he says.
The healthy eating trend is also helping to drive fresh soup growth.
“Fresh soups provide consumers with a wholesome option that people can take on-the-go and quickly heat within minutes,” says Callahan at Kettle Cuisine.
Shepard of Fortun Foods says deli departments have evolved, as well, and more than ever, they are competing for that restaurant fare, meaning they have upped their quality and unique offerings.
“Deli’s hot soup station needs to have the same makeover, up the quality standard that consumers are demanding,” she says. “Branding is important, it is a perception of quality. Branded soup at the soup station is a great way to increase your soup sales. Commodity soups are out, unique fresh gourmet soups are in.”
When it comes to soup packaging innovations, the focus is on environmentally friendly options.
“We’re still seeing sustainability and a focus on controlling spoilage and waste,” says IDDBA’s Prach. “But we’ve seen soups in all different packages — flex pack, jars, plastic containers. Soup manufacturers are starting to get creative mainly for sustainability aspects. Customers also are seeking convenience.”
MARKETING AND MERCHANDISING
While visibility is important, providing different soup purchasing options is key to success in the category.
“Retailers finding the most success have created an ‘on-the-go’ lunch section within their prepared foods department, offering soup along with sandwiches and sides,” says Seeger.
Especially with today’s inflation and higher food prices, soup is an economical meal solution.
“People understand with a 32-ounce container of soup and salad, you have a great family meal,” says Sewall at Blount. “With both private label and branded items, deli departments can bring someone new to the soup category every week. Adding a line of soup creates a marketing opportunity.”
Cross-merchandising also can create a soup destination.
“We also have our pot pies and flatbread pizzas, which provide the availability to put meal deals together,” says Sewall. “When delis cross-merchandise all the vertical set, the department can offer bundling specials. Offering products in the same set so customers can easily find them expands soup’s potential.”
Although soup can be merchandised either in the deli or dairy sections, Prach recommends the deli department.
“It is much better served in the deli, where people can grab the soup to serve with other meals,” she says. “We encourage grocers to expand and have CPG (consumer packaged goods) soup merchandised in the deli.”
Both hot and cold soups are typically staples in the deli department.
“Deli departments are driving sales with delicious new prepared meal options. What is missing today is a bundle opportunity with hot soup. A healthy alternative to offer a value-added soup, salad or sandwich and a drink. Make it easy for that consumer to choose their own bundle meal ‘to-go.’ Build it and they will come,” says Shepard of Fortun Foods.
With the Farmer’s Almanac predicting an unusually cold and snowy winter, growth opportunities for the soup category appear to be strong in the months ahead.
“Soup is nutritious, filling and relatively inexpensive,” says IDDBA’s Prach. “It’s an easy way to change things up in the department. By offering a soup of the day, stores can create a destination.”
