The category’s exact size is difficult to pinpoint because of hard-to-track bulk sales in ethnic-Asian grocery stores, but most category players and analysts agree it is growing 30% to 40% annually, Julian Mellentin, director of New Nutrition Business, adds in a new report that outlines how to launch a seaweed snack successfully.
This steep growth curve translates to about 27 new snack products with seaweed launched in 2014 compared to only 16 in 2013, 10 in 2012 and 16 in 2011, according to Mellentin. Based on the fact that 15 seaweed snacks have already launched in 2015, he adds that the growth likely will continue.
To put this growth in perspective, sales of seaweed snacks in the U.S. already are overtaking those of kale, which has become a gold standard of sorts for evaluating the ascent and household penetration of healthy food in the U.S., said Mellentin, who estimates the fast-growing kale chip market in the U.S. is worth only about $200 million currently.
He explained seaweed was able to outpace kale in part because “kale is just one plant with limitations on its supply, while seaweed is an entire family of plants cultivated globally with no supply constraints.” It also offers “a more attractive nutritional profile and no barriers to the number of food applications you can use it in,” Mellentin says in the report.
Other players in the space compare the growth of seaweed snacks to that of coconut water and jerky, which both exploded in recent years.
Growth drivers
The “attractive nutritional profile” of seaweed is a dominate reason for the plant’s success at a time when more Americans are seeking better-for-you alternatives to the unhealthy snacks that dominated store shelves for decades, according to the report.
It notes that seaweed is naturally high in protein, calcium, antioxidants, iodine, potassium, iron, folic acid, fiber and omega-3 fatty acids. It also has high levels of vitamins A, B-6, C and B-12, according to the report.
The plant also fits comfortably among the many free-from aspects that consumers are seeking, including gluten, common allergens and GMOs, according to the report.
The plant also is getting a boost from the increased interest in vegan and vegetarian foods in America, as it has been used for years as a non-animal source for umami flavor, Mellentin writes. He adds, for this reason the ingredient also fits into the macro trend of U.S. consumers seeking new, bold flavors and adventurous foods.
Another key driver in the growth of seaweed snacks is the increasing availability of sushi in the U.S. in the past 30 years, Mellentin said. He notes the U.S. sushi market grew 28% from 2010 to 2014 and is valued at $2.2 billion. In addition, sales of packaged sushi rolls sold as snacks in supermarkets and convenience stores grew 13.1% in 2014, making it the fastest growing snack category measured by IRI, according to the report.
Seaweed snacks dominated by Davids, not Goliaths in U.S.
So far in the U.S., mostly small startups are tapping into the versatility of the seaweed snack trend, which means the category is highly fractured and still has plenty of white space for additional launches and players, according to the report. But large companies could soon step in.
“As an ingredient, startup companies increasingly are putting seaweed into healthy snack chips, noodles and other staples of the American diet,” according to the report, which adds it also “is being ground into powders that can be sprinkled onto various foods ranging from ice cream to popcorn.”
As models for launching seaweed snacks, the report points to SeaSnax, Ocean’s Halo, Roland Foods and Eden Foods, which all have launched seaweed crisps and other options in recent years in the U.S. A slightly larger player in the space is Annie Chun’s, which is owned by CJ Foods and launched an ever-growing line of seaweed chips in 2010.
For now, really large CPG companies continue to restrict seaweed snack sales abroad, such as Frito Lay’s Lay’s Nori Seaweed chips in Thailand and Japan and Seaweed Pringles in Thailand, according to the report. However, as startups continue to blaze a trail for the foods in the U.S. it could be only a matter of time until large companies enter the picture.
Target urban, health-conscious consumers
That said, Mellentin suggests the mainstream consumer, who large CPGs most often court, is still not the ideal target for seaweed snacks.
“Seaweed still invokes a negative perception about its taste and texture. But this is true only for mass market consumers – and these people should not be the target for your efforts to launch a seaweed snack product,” writes Mellentin.
Rather, he suggests that companies hoping to get in on the seaweed trend “at day one” should target “educated, upper-income, health-conscious urban consumers,” for whom “the idea of eating seaweed is no longer alien – after all, these are the same consumers who have embraced bean chips, coconut water, sprouted snacks and kale.”