Organic Chips Market Analysis Report By Distribution Channel, By Product Type And Segment Forecasts From 2019 To 2025

Industry Insights

The global organic chips market size was worth USD 14.2 billion in 2018 and it is expected to exhibit significant CAGR during the forecast period. Increasing demand for healthy chip products with proper nutritional value is prompting manufacturers to enter into the healthy snacks market, which in turn is driving the market. Rising awareness about the importance of organic products and the side effects of chemically prepared food are supplementing the growth of the market. Further, the recent trend of consuming clean-label food products is creating a lucrative opportunity for manufacturers.

Hectic work schedule has resulted in changes in the lifestyle where people tend to eat healthy snacks in between meals to fulfill their nutritional needs. Additionally, consumers are more inclined towards having short meals multiple times a day. For example, a large number of North Americans prefer small meals regularly in a day. Growing health awareness makes them more inclined towards organic foods. The popularity of chips as a short meal is gaining traction among developed regions, which in turn driving the market.

Leading players are relying on the introduction of innovative products to cater to the needs of the larger consumer base. For instance, Barnana introduced ridged plantain chips in January 2018 to set its footprints in the salty snacks category. Other leading players are also following the suit. Recently, in January 2020 Campbell Soup Co. introduced organic potato chips in its product line.

Further, increasing investment in research and development by several key players is expected to bolster market growth shortly. For example, Kettle Foods Inc. focuses on increasing its expenditure on research and development, and the company increases its investment each year.

United States is expected to grow with a significant growth rate with a CAGR of 3.8% over the forecast period. The presence of several key players, such as General Mills Inc., Kettle Foods, Inc., The Hain Celestial Group, Inc., and Luke’s Organic, is attributing to the growth of this region. These companies together hold a significant market share in the chips segment.

Product Type Insights

Vegetable-made organic chips accounted for the largest market share in 2018. Easy availability of different vegetables is the primary factor driving the demand for this segment. In 2018, the vegetable segment accounted for USD 1.7 billion in market share. Additionally, the growing popularity of potato chips makes this segment dominating among all.

Organic chips made up of cereals and grains are growing at a significant rate owing to the health benefits of cereals and grains. Innovative advertising and marketing of their products play a key role for manufacturers. This advertisement leads to an increase in awareness among consumers, thereby driving demand. On the other hand, Asia Pacific is witnessing a rise in demand for spices, which in turn provides a lucrative opportunity for manufacturers to strengthen their presence in the region.

Distribution Channel Insights

The retail and supermarket segments were expected to dominate among various sales channels during the forecast period. The segment is expected to grow with a CAGR of 4.3% over the forecast period. The growing trend of one-stop shopping among consumers is leading to the growth of this segment. Further, consumers are opting for a bulk purchasing through supermarkets and hypermarkets. In addition, consumers in emerging countries are more inclined towards the traditional way of purchasing, which in turn fueling the growth of this segment.

The online sales channel is expected to witness a significant growth rate during the forecast period. Growing technology adoption among consumers and increasing e-commerce platforms are attributing to the growth of this segment. Leading players in the market sell through their online portals. Other players mostly rely on third parties such as Amazon and Vitacost for their online sales. The popularity of these sales channels is gaining traction in Asia Pacific countries. For instance, an online platform evolvesnacks.com offers organic chips at a comparatively low price in India, thereby proliferating the growth of this segment.

Regional Insights

North America accounted for the largest share in 2018 with over 34.2% of the market share. Increasing health consciousness has resulted in the rise in the popularity of organic chips in the region. Further, increasing demand from the United States is expected to help the region in maintaining its dominance over the forecast period. Rising obesity in North America has shifted the consumers’ focus toward alternative organic foods.

Rising demand for organic foods from Germany and France is expected to make Europe a key region in the market during the forecast period. On the other hand, Asia Pacific is projected to be the fastest-growing region largely because of improving consumers’ food habits and growing adoption of western culture in countries such as India and China. Furthermore, increasing e-commerce sales and the introduction of new products are bolstering the demand for organic products in this region. For example, a popular Indian e-commerce site indiamart.com offers organic potato chips.

COVID-19 Impact Insights

The organic chips market has been negatively affected due to the outbreak of COVID-19. The pandemic has led to the closure of retail and supermarket stores across different parts of the world to contain the spread of the coronavirus. Supermarkets and retail outlets are the major sales channels of organic chips. Further, these chips are prepared using fruits, cereal, vegetables, and grains. Owing to the imposition of lockdowns, supply chains of these raw materials were severely disrupted. Nevertheless, online sales have surged during the pandemic. In addition, with the reopening of various retail stores, the market is estimated to start recovery over the next few years. Manufacturers should strengthen their online distribution channels to garner a larger consumer base.

Organic Chips Market Share Insights

The market is fragmented and highly competitive owing to the presence of a large number of players. Leading players are focusing on increasing their research and development expenditure to introduce innovative products. Many players have shifted their focus towards plant-based chips to encourage the consumption among vegetarian population. In May 2017, U.K based Eat Real announced the introduction of organic vegan snacks. Various other companies are also strengthening their presence in the vegan organic chips market.

Key players in the market are Tyrrells PotatoCrisps Limited, Rhythm Superfoods, General Mills Inc., the Hain Celestial Group, Inc., Luke’s Organic, and Popchips among others. Manufacturers are also introducing products with different flavors to increase their brands’ appeal. The demand for natural flavor is gaining traction, which provides a lucrative opportunity for manufacturers to capture a larger market share.

Report Scope

Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2015 to 2025. For this study, Million Insights has segmented the global organic chips market report based on product type, distribution channel, and region:

• Product Type Outlook (Revenue, USD Billion, 2015 - 2025)
    • Vegetable
    • Fruits
    • Cereal
    • Grain

• Distribution Channel Outlook (Revenue, USD Billion, 2015 - 2025)
    • Retail and Supermarket
    • Online Platform

• Regional Outlook (Revenue, USD Billion, 2015 - 2025)
    • North America
        • U.S.
    • Europe
        • Germany
        • France
    • the Asia Pacific
        • China
    • Central & South America
        • Brazil
    • Middle East & Africa
        • Saudi Arabia