The Toughest Neighborhood In Retail Grocery
Frito-Lay controls about one-quarter to one-half of the chip side of the snack aisle. In the soda half-aisle, two dominating companies can effectively block all but the new niche products and private labels. This condition makes both chips and soda relatively calm categories. Upstarts are doing neat things, but nobody is challenging the soda oligarchy, which like tech giants after Frank-Dodd, simply buy the upstarts when they start getting big.
On the rowdy left bank of the Seine where the energy drinks live, two brands – Red Bull and Monster – are entering a similar static relationship. Monster, which came out of Hansen’s Natural and is about 16% owned by Coca-Cola, rapidly expanded its offerings. Red Bull’s more recent foray into line extensions holds territory on the shelves and provides in-routes for those who are less enthusiastic about the classic Red Bull flavor. Rockstar, purchased by PepsiCo in 2020, is the Chrysler to Monster and Red Bull’s Ford and Pepsi, with 2024 revenues of around $137 million, $7.5 billion, and $11.7 billion respectively.
The nutrition bar section is probably the closest thing in a grocery store to the Hobbesian state of nature. The category has had clear leaders, but unlike our other examples, each has been humbled by upstarts that permanently took away shelf feet. The category has relatively low barriers to entry and covers the extremely broad idea of “nutrition.” There’s always a way in. Maybe it’s not the best way. But, as long as humans fuss over their nutrition, and knowledge about what we consider good or bad nutrition changes, there’s an angle.
For these reasons, nutrition bar innovations are abundant, and do a better job of tracking changing shopper tastes than any other category I can think of.
(Nobody is buying cheese puffs and soda pop for nutrition. Their functions are pretty well-defined, and efforts to change that dialogue tend to be struggles. What happened to all those SKUs of baked potato chips?)
The first nutrition bar has a pedigree as old as Venice, CA’s Gold’s Gym. If you were once a teenage lifter bro – curls get gurls, dude – you know it: Tiger’s Milk. It was down there on the bottom somewhere with the sesame bars. At some point in the ‘80s, Weider Nutrition bought Tiger’s Milk. Ol’ Joe and Betty Weider published Muscle & Fitness, sold home gym equipment, and were as responsible as anyone for the American bodybuilding culture and the promotion of Arnold Schwarzenegger to cultural icon.
In that era, most people’s first nutrition bar was the Nature Valley Granola Bar, designed to make a breakfast-table food portable. Known to produce shrapnel when eaten or even touched accidentally while rifling through a backpack, it and GORP (good old raisins and peanuts) were the preferred snack for outdoorsy fitness folks. “Crunchy granola types?” There you go. From these two, we find the key ingredients of a lot of nutrition bars even unto today: Oats, honey, peanut, chocolate, dried fruit.
Most nutrition bar companies offer peanut butter and chocolate chip or brownie SKUs. Table stakes.
Further processing with more innovative flavors brought us the original PowerBar, whose benefits partially derived from the physical exertion required to chew them. If stress grows strong bones, the original PowerBar probably produced stronger jawlines than all the testosterone therapy in the world. Those days of hyena-like mastication, drooling down the front of your cycling jersey, are gone, now. While the Nature Valley Granola Bar continues to threaten soft tissue everywhere, the original PowerBar lineup is no more. Tiger’s Milk? Bought and sold, bought and sold. Discontinued in 2022, the big cat was a victim of red-in-tooth-and-claw CPG competition.
lif and other bars challenged PowerBar’s highly-processed product by offering roughly the same promises of nutritional performance in a more handmade and natural-looking form that was also just easier to consume. Rather than a muddy paste, you could make out what looked like actual food, rather than food tools designed for interplanetary space travel. KIND produced what is probably the fullest expression of this ideal, going so far as to do the unthinkable and show off their beautiful product in a clear wrapper.
It was scandalous.
KIND’s strategy of getting started in Starbucks, which at the time held a strong reputation as being a place for early-adopter and thought-worker types, was a winner.
Early 2000s recipes largely focused on carbohydrates. Like basketball shoes, nutrition bars touted athletic performance and its associations to everyday folks. Later, the carb thing got a little more sophisticated as manufacturers rolled out “balanced nutrition,” including PowerBar’s “C2 Max carbohydrate blend.” You see, the functional performance payoff of nutrition is energy, and carbohydrates became associated with energy highs and crashes. Thus, many nutrition bars became cast as energy bars: Good bars you eat for sustained energy.
LÄRABAR may have been the first to find a thoroughly different angle, with nutrition bars explicitly designed for, and marketing to, women.
Coatings, which are common on LÄRABAR and others, serve at least three purposes. First, in the absence of binders like fig or date (which stay chewier longer than honey) chocolate and yogurt help hold together finely-processed proteins and other ingredients. Second, they add to the taste and eating experience, often making powdery or chalky products easier to consume. Third, they look and feel more like the candy bars we are trying not to eat.
Just like anything else in a dynamic, competitive environment, nutrition bars now survive and thrive by carving out niches that are desirable enough to want to defend, and in doing so, have driven out a lot of the older SKUs. As the late, great marketer Al Reis would remind us: specialization and positioning beats generalists. There are organic, vegan, and sustainably-sourced bars, and there are new ingredients, like pea protein, hemp and chia seed. We have nootropic bars (“smart bars”), caffeinated bars, keto bars (N¡ck’s is billed as a keto “Swedish-style snack bar”), “slow-burn,” and macrobiotic bars. Bulletproof has a collagen protein bar. Energy + nice hair.
Nielsen could give you the data, but as of now, I’d bet protein is the broadest draw to the category, building on decades of Atkins, Keto, and Carnivore Diet ideas. Protein build muscle. Make strong! Smash puny macrobiotics!
Perhaps the best example of the category’s evolution comes from RXBAR, the modern Crossfit bar to Tiger’s Milk’s bodybuilding bar. What do we see? It has scuttled the generalist “nutrition bar” moniker for – you guessed it – “protein bar.” But, it also offers far better eatability, and simpler and cleaner ingredients (advertised right on the principal display panel).
As an aside, is all this protein good nutrition?
I wouldn’t know. Not only am I not a nutritionist, but my sense of well-being is barely and willy-nilly held aloft by good-enough genetics like a kiting spiderling. Speaking of arthropods, it appears that the people telling us we’re eating too much protein are also trying to get us to eat crickets and mealworms because they are protein rich.
Maybe that’s the next big thing: The Bug-Out Bar™. Better coat that in yogurt and hide it in an opaque wrapper.
Turn the lights off.