Gluten-free takes the cake in snack food products

The market for gluten-free snacks is exploding. Once the exclusive arena of niche brands, now even mainstream manufacturers are getting on board. This summer, General Mills rolled out a line of gluten-free cookie, brownie and cake mixes under its Betty Crocker brand. In 2006, the company converted its Rice Chex cereal to a gluten-free product.

General Mills research showed that 12% of U.S. households want to eliminate or reduce their gluten intake. Part of the increased interest in gluten-free products is a spike in the number of patients diagnosed with Celiac disease. Incidence of the immune system disorder has increased dramatically in the last half century. Research from the Mayo Clinic suggested that young people today are 4.5 times as likely to have Celiac disease as were young people in the 1950s.

Even consumers without wheat allergies are showing an interest in eliminating or reducing the amount of wheat in their bodies. “We’re seeing a lot more interest from consumers who are opting to reduce their wheat intake,” said Christine Brown, marketing manager at Addison, Ill.-based Natural Snacks LLC. “When Oprah did her 30-day detox diet, gluten was one thing she eliminated.”

Kari Ramsey, a spokeswoman for Nature’s Path Foods, agreed that the appeal of gluten-free foods isn’t limited to consumers with Celiac disease. Nature’s Path is one of the largest players in the category. The company’s EnviroKidz line of crispy rice bars and animal cookies have performed well in the grocery channel. “For some people, opting for gluten-free foods is a lifestyle choice rather than a health-motivated choice,” Ramsey said.

Since one theory on the increased incidence of Celiac disease has to do with the way wheat and bread is processed, consumers who want more natural products may be opting for these gluten-free offerings. And consumers should have no problem finding an array of foods to fit their needs. More than 1,000 new gluten-free products were launched in 2008, according to Mintel Global New Products Database. Another 552 products were introduced through July 20. Cereal bars, snacks and sweets saw the most new product introductions.

Gluten-free cereals are one of the most rapidly growing segments in the health-and-wellness cereal category, according to Kent Spaulding, VP marketing for San Francisco-based Barbara’s Bakery. Spaulding said his company’s gluten-free products are growing at a rate of over 30% annually.

A recent report from Packaged Facts estimated that gluten-free products had a compound annual growth of 28% between 2004 and 2008, with sales reaching $1.56 billion. Supermarkets account for 30% of sales, and health food and specialty stores account for another 30% of sales. Drug stores largely have stayed away from the business, but maybe it’s time to rethink the strategy. “Consumers go to a drug store for products that make them feel healthier,” Brown said. Gluten-free snacks certainly fit that profile for a growing number of customers. Natural Snacks gluten-free business has grown 78% last year, according to Brown.

The company, which is expanding its offerings, recently added Cheddar Cheese Jalapeno Puffs to its line of Michael Season’s Baked Cheese Snacks. The newest flavor will be available at retail in November and will retail for $2.99 for a 5-oz. bag. Natural Snacks also is adding single-serves of its most popular baked flavors to its lineup. The 100-calorie, .75-oz. bags will retail for 99 cents. “We’ll be rolling out a whole program of sleeves, clip strips and other promotional vehicles so retailers can bring the products in on an in-and-out basis,” Brown said.

Barbara’s Bakery, which currently does not offer gluten-free snacks in its lineup, plans to add gluten-free snacks in the coming months.