While soup has been a staple food for many, especially during the cooler months, consumers are now asking for much more.
Suzy Oo, Senior Industry Analyst at IBISWorld, tells Retail World that several “well-established” brands in this category, such as Continental and Campbell, are perceived as a pantry staple by many Australian consumers. However, in the past five years, increasing health awareness has had an impact on soup income.
“Consumers have become increasingly aware of the ingredients in their food, and some people are actively reducing their consumption of highly processed foods,” she says. “Canned soups in particular are usually high in sodium and fat, which has led many consumers to deviate from these products.
“The manufacturers have tried to maintain consumer interest by expanding specialties, reduced salt and lower-calorie soup ranges. The Heinz Soup of the Day range is an example of this trend, in which flavored soup products are packaged in bags and marketed as a premium alternative to conventional canned soups. The increasing range of soup specialties at retail level in combination with increasing premiumization trends is driving the demand for soup products with higher margins. "
Pandemic surge for healthy and local
It is fair to say that Covid-19 had a significant impact on most FMCG categories and presented opportunities and challenges along the way.
Speaking about the impact on soups, Ms Oo says the pandemic and the related panic buying behavior of food have boosted sales in the categories where soup affordability and long shelf life are attractive to consumers looking to store essential items.
"However, many supermarkets and grocery stores, including Woolworths and Coles, have placed purchase restrictions on these coveted products, and this may have slowed the significant growth in pre-packaged soup sales during the lockdown periods," she says.
While many Australians are looking for locally sourced produce (in this case soup), Ms. Oo also suggests that multiculturalism trends are "reshaping" consumer preferences for soup products.
“Instead of consuming ready-made soups as is, many people incorporate more flavors and ingredients to personalize their soups,” she says.
“More sophisticated flavors are likely to drive demand for non-traditional soup flavors, a trend likely to be fueled in part by increasing consumer preferences for Asian cuisine. Examples of popular Asian soup flavors are miso, laksa, pho and Thai coconut soups. "
This complexity is also reflected in the variety of nutritional needs that Ms. Oo addresses.
"The increasing dietary requirements mean that retailers need to stock a wider range of products such as gluten-free and vegan soups," she says.
Find out more about the soup category in the June issue of Retail World.