Broadening the Horizon

Sour cream and dip makers focus on widening varieties, increasing availability and pitching new uses.
by Julie Cook
Milk, cheese and, to some extent, even ice cream — these dairy products have long been considered staples of the American diet, items that can likely be found in most every refrigerator in the nation. Not so for sour cream and dips.
While they certainly have their own fervent followings, these cultured creations typically won’t be found on most consumers’ weekly grocery lists. In part, that’s because they have long been stigmatized as “special occasion” foods that are too decadent and fat-laden for everyday consumption.
Granted, few party tables or Super Bowl Sundays would be considered complete without a tub of French onion dip, strategically placed alongside a bowl of chips or veggies. But such occasions are far from everyday occurrences, so dip certainly isn’t top of mind for most consumers when they hit the supermarket each week.
Fortunately, sour cream isn’t nearly as limited in the minds of most consumers. On the contrary, the burgeoning Hispanic-American population, along with the related increasing popularity of Mexican cuisine, gave sour cream quite a boost over the past 10 years. From tacos to quesadillas and beyond, a growing number of consumers have taken to plopping a dollop of the creamy white stuff on their food before digging in.
Unfortunately, both sour cream and dip experienced a less than banner year, as recent data from Chicago-based Information Resources Inc. (IRI) indicates. During the 52-week period ending August 8, 2004, dollar sales of sour cream rose 0.6 percent, but unit sales fell 1.9 percent, in U.S. food, drug and mass merchandisers, excluding Wal-Mart. Refrigerated dips fell 0.5 percent and 4.1 percent. Only shelf-stable dips managed to achieve growth in both dollar and unit sales, which rose 0.8 percent and 2.1 percent, respectively.
Processors cite a variety of causal factors, including the sluggish economy, high raw-ingredient prices — particularly butterfat — and the low-carbohydrate craze. While dips themselves are naturally low in carbohydrates, some processors believe they have been suffering much the same fate as butter, which saw sales fall because carb-conscious consumers were avoiding many once-popular “carriers,” like bread and baked potatoes.
“Chip sales are down considerably this year,” says Dave Haley, regional director of marketing, Midwest region, Dean’s Dairy Group, Dean Foods Co., Rosemont, Ill. “If the chip companies are down, sour cream-based dips are going to be down as well.”
Not everyone agrees with Haley’s assessment of the situation. Pete Kondrup, general manager of Westby Cooperative Creamery, Westby, Wis., says he hasn’t witnessed any real impact of the low-carb craze on sour cream or dip sales. “People that eat dips usually aren’t that concerned about their weight anyhow,” he says.
Meanwhile, Betsy Watson, marketing director, Anderson Erickson Dairy Co. (AE), Des Moines, Iowa, firmly believes that even the most carb-conscious consumers will continue treating themselves from time to time. And when they choose to let their hair down and loosen their restrictions on carbs, chips and dip is one of the more popular options.
“If people are going to consume carbs, it’s going to be something that’s a treat for them,” Watson says. “For some people, that might be a dessert. For others, it’s a salty item. When they choose something like chips, dip frequently enters the picture.”
Making News
To entice consumers to reach for a container of dip when they are seeking something decadent, a number of processors have unveiled new — and, frequently, bold — offerings in recent months. AE introduced Southwestern French Onion Dip, which relies on chipotle peppers to give it a little extra kick. According to Watson, consumers have been relived to find that it’s not a hot, spicy dip.
Westby experienced a similar reaction to its new Roasted Tomato Red Pepper Dip, a naturally cultured, sour cream-based dip featuring real chunks of tomatoes and peppers.
Last year, the company rolled out Tater Topper, a sour cream-based product featuring large chunks of onions and chives. General Manager Tom Gronemus, developer of the product, claims that a couple of dollops of Tater Topper “can transform any plain potato into a gourmet dish.” Although the Topper was designed specifically to complement a baked potato, Gronemus says it makes a great dip and, for his tastes, pairs particularly well with Ritz crackers.
All Westby products are made from rBST-free milk, a selling point Kondrup says means a great deal to some consumers and absolutely nothing to others. “There’s a certain niche out there for whom that’s the reason they buy our product, and then there’s another group that doesn’t really care,” he explains. “There are people that are definitely interested in it, so we feel like we’re filling a certain niche.”
Responding to the growing demand for organic dairy products, Columbus, Ohio-based T. Marzetti Co. introduced Organic Ranch Veggie Dip this past January. Hailed as the first USDA Certified Organic Veggie Dip on the market, the product joins Marzetti’s sour cream-based veggie dip line, which currently holds the title of best-selling refrigerated dip brand, boasting a 19.0 percent dollar share. In October, Marzetti plans to boost its offerings even further, rolling out three more new products — Buffalo Ranch Veggie Dip, Bacon Tomato Veggie Dip, and French Vanilla Yogurt Fruit Dip.
Garnering Favor
Although a handful of companies, like St. Paul, Minn.-based Old Home Foods, produce hydrogenated soy-based dips, most dairy processors firmly believe that consumers prefer sour cream-based dips.
Consequently, Dean Foods recently added a “Made with Real Sour Cream” banner to its Dipzz® brand containers. Introduced in January 2002, Dipzz is a line of fresh sour cream dips featuring such “fun flavors” as Jalapeno, Ranch, Red Chili, Green Chili and Mexican Fiesta.
In its first two years of availability, many consumers have been drawn to the “vibrant, exciting” Dipzz® packaging, according to Susan Meadows, vice president, director of marketing, Southwest region, Dean’s Dairy Group, Dean Foods Co., Dallas.
In addition to traditional grocery stores, Dean sells the product in so-called alternate channels including club stores, where a boxed, variety four-pack is available. What’s more, Dean relies heavily on sampling programs to gain trial of products like Dipzz. Meadows reports the company is entertaining numerous proposals that would place young adults dressed in workout clothes at tailgate parties, where they would hand out Dipzz samples from ice chests.
Naturally, Dean isn’t the only manufacturer to employ sampling to get consumers to try their products. Both Westby and AE believe strongly in sampling’s ability to boost sales.
“Some people are risk-takers who like trying new things,” explains Watson. “They don’t mind spending money to try a product. Other people are not as likely to buy the product unless they’ve tried it first, so sampling is really important to get them to try new products.”
Regardless of how much sampling takes place, 10 to 12 percent of the population would qualify as true “dip lovers” who consume the product on a regular basis, according to Jed Davis, director of marketing, Cabot Creamery Cooperative, Cabot, Vt.
“Their idea of dip is that it’s a condiment like ketchup or mustard or salt or pepper,” he says. “When they get home after a hard day’s work and reach for a snack of pretzels or vegetables or chips, they take the lid off the dip container and scoop some dip onto whatever they are eating.”
For most consumers, dip — and sour cream, to a lesser extent — retains its stigma as a special-occasion food. In fact, spikes in sour cream and dip consumption are so closely tied to holidays and other big entertaining days, such as Super Bowl Sunday, that Haley says companies actually could devise their production schedules around them.
“It would be a marketer’s dream to be able to have steady, increased consumption patterns throughout the year, but it would break the bank of most companies to do that,” says Haley. “You would basically have to quadruple your marketing and advertising budget to get people to buy sour cream or dips on, let’s say, August 15th.”
Instead of breaking budgets, sour cream and dip makers are increasingly relying on such grassroots tactics as providing recipes either online or at sampling events. AE, for example, suggests consumers try mixing one of its dips into a twice-baked potato or spreading it on their hamburger bun to give the sandwich “a fun kick and a different flavor.”
While making serving suggestions and recipes available to consumers certainly won’t hurt, Dave Holdsworth, vice president of sales and marketing at Old Home Foods, wonders just how much it actually will help. He says the flatness of sour cream sales in recent years is a direct result of consumers cooking less at home. And because they are cooking less, they are less skilled in the kitchen.
“You can provide them easy recipes to help them feel more confident in the kitchen, but it’s a nationwide trend that we’re going to have to fight,” Holdsworth says.
Meanwhile, Dean Foods’ Chicago division has drawn attention to all of its cultured products by giving the packaging a facelift. This includes emphasizing the Dean’s brand mark and adding usage photos, such as a baked potato topped with sour cream.
“If you look at the traditional dip package, it’s basically just a line art of an onion,” Haley says. “If we’re going to get consumers to embrace our products, we need to do two things: leverage our brand strength and take our packages from the turn of the century and give them some appetite appeal.”  df
Julie Cook is a freelance journalist based in the Chicago area.