CHICAGO — Heinz has long been the undisputed king of ketchup, with Hunt’s a distant runner-up and falling farther behind.
But as millennials and their flavor-seeking taste buds drive growth in condiments, the underdog is putting up a fight.
Chicago-based Conagra Brands, which makes Hunt’s, is rolling out a revamped all-natural ketchup, premium barbecue sauces and new lines of hot sauces, flexing its muscle in a category it largely has ignored for years.
Meanwhile Kraft Heinz, co-headquartered in Chicago and Pittsburgh, is asserting its dominance on the condiment shelves with a line of mashups including Mayochup (mayonnaise and ketchup), Mayomust (mayo and mustard), Mayocue (mayo and barbecue) and Kranch (ketchup and ranch), seeking to capture the attention of shoppers hungry for new experiences.
The hustle in the normally sleepy condiment aisle comes as millennial shoppers display a penchant for sauce. While fresh food is commanding a greater share of grocery budgets, consumers are dousing their food with bottled flavors to liven up their meals and create variety throughout the week, said Darren Seifer, food and beverage industry analyst at market research firm NPD Group.
Chili sauce is particularly hot, with sales surging 23 percent between 2013 and 2018 and projected to climb another 16 percent by 2023, according to Euromonitor. That appetite for spice is driving manufacturers to give old standbys a kick, and curry ketchup and wasabi mayonnaise are joining the regular staples in many household refrigerators, said Megumi Matsunaga, senior analyst at Euromonitor.
Driving the saucing trend are millennials, who developed their taste buds eating out, often in ethnic restaurants, and turn to condiments for an affordable way to replicate those flavors at home, said Conagra CEO Sean Connolly. The hope is to cater to those who grew up on Chipotle and Sriracha, he said.
“They love bold flavors, they love to sauce their foods, and they love brands,” Connolly said.
But standing out in the condiment aisle is challenging for brands when there are dozens of options that all look mostly the same. It’s also a product with heavy competition from private-label manufacturers, including Amazon, which recently launched a mustard under its Happy Belly brand as it expands its private-label efforts.
Michael Whitaker, 36, was in a Mariano’s grocery store in Bucktown recently to buy buffalo sauce for vegetarian wings he planned to make. A fan of Frank’s RedHot brand, Whitaker chose Frank’s RedHot Wings sauce even though the $4.99 price tag was $2 more than a competitor, because he knows he likes the flavor profile.
But Whitaker is not brand loyal when he shops for ketchup, and focuses more on the nutrition label on the back. He’ll usually buy the ketchup with the least amount of sugar at the best price, regardless of who makes it, he said.
The introduction of healthier options has been driving much of the sales growth.
The Heinz brand posted record 8 percent growth last year, propelled mostly by its ketchup lines that are organic, free of high fructose corn syrup, sugar-free or sweetened with honey, said Steve Cornell, president of sauces, meals and frozen food at Kraft Heinz. Those better-for-you products now represent 15 percent of ketchup sales and are growing, he said.
“We are bringing back households that gave up on condiments years ago,” Cornell said.
Now Conagra is giving Hunt’s ketchup a long overdue makeover.
The recently launched Hunt’s “Best Ever” ketchup has no high-fructose corn syrup, is non-GMO and is “thicker and richer” thanks to more tomatoes, said Dale Clemiss, president of grocery and snacks. It also switched from an upright glass bottle to a squeezable plastic container, catching up to its competitors, he said. At a local Mariano’s store, it’s priced 40 cents higher than the original Hunt’s.
Hunt’s isn’t close to grabbing the No. 1 spot in the $885 million U.S. ketchup market. Market leader Heinz’s ketchup sales topped $551 million over the past year, while the No. 2 brand Hunt’s had sales of$85.5 million, according to IRI, a Chicago-based market research firm. Private-label products accounted for $152 million in ketchup sales.
But by making Hunt’s a premium product, Conagra hopes to win over shoppers and grow share.
That may not be an easy feat.
At Mariano’s, shopper Holly Hemwall, 33, stood before the condiment shelves holding a regular Heinz ketchup in one hand and Simply Heinz, its all-natural version, in the other. She was examining sugar content and chemicals in the list of ingredients, and ultimately threw the Simply Heinz into her basket.
Hemwall said she didn’t think to consider Hunt’s Best Ever, which was on the bottom shelf retailing for $1.99, a dollar less than Simply Heinz.
“I don’t see why I would change ketchups,” said her husband, Peter Hemwall, 30.
Conagra’s $1.2 billion condiments business is the company’s latest investment focus as Connolly, who took the helm in 2015, seeks to modernize its broad portfolio of packaged foods to appeal to more sophisticated, health-conscious consumers.
In addition to ketchup, Conagra is relaunching corn syrup-free Hunt’s barbecue sauces with flavors like “cherry wood chipotle” and “hickory cracked pepper.” It is debuting lines of hot sauces from Frontera, its brand of Mexican frozen meals and salsas developed with Chicago chef Rick Bayless, as well as Ro-Tel, a brand better known for diced tomatoes, boasting ingredients like fire-roasted hatch green chilies on the front label.
Kraft Heinz is promising condiment innovation also, and its line of mashups represent just the very beginning, Cornell said. The company last year asked on Twitter if consumers would like it to bring Mayochup to market, and it did so after it got more than 500,000 votes. By the end of the year, Mayochup was in 50 percent of grocery stores.
Don Fitzgerald, a food industry consultant and former Mariano’s executive, said anything to jazz up the condiment aisle is welcome because it’s been a ho-hum category for a long time.
But even though sauces are popular — and “dipping culture” in particular has caught on — other consumer trends don’t portend well for them, he said.
As people move away from meat toward more plant-based alternatives, they may move away from the foods that traditionally called for condiments — hamburgers and hot dogs.
“Do you really want to put ketchup on your Impossible Burger?” he said.
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