However, while annual sales have been flat in recent years, certain areas of the $3.8 billion soup market show promise. Ready-to-serve (RTS) varieties have seen their sales flourish, increasing roughly 16% between 2000 and 2002, and overtaking condensed soup sales in the process. Furthermore, Mintel predicts RTS soups will expand at a higher rate than the general industry.

Campbell Soup, Camden, N.J., has enjoyed a resurgence in popularity, partially due to consumer desire for comfort foods. However, comfort is only one draw. With a weak economy, more consumers are eating at home, and they need a quick, convenient meal—two hallmarks of recent soup introductions.

Convenience is also important outside the home. Campbell, for example, has recently introduced Soup To Go, which allows consumers to microwave a single-size serving and eat it on the run. Another variety, Soup at Hand, is a microwaveable soup in a container shaped like a coffee cup, which fits in most automobile cup holders.

Consumers are seeing more value-added soups on the shelf, with exotic varieties and quality ingredients such as bacon pieces and creamy dairy flavors.

Soup in jars was considered cutting-edge upon its introduction in the mid-1990s. It allowed purchasers to see the product they were buying and may have contributed to a perception of freshness. Increasingly, that perception is turning to soups in the refrigerated section. A mainstay in foodservice, refrigerated soups are relatively new to supermarkets. According to Mintel, “The quality of these products and the freshness of the ingredients will appeal to consumers, who are looking for a restaurant-style food experience in the comfort and convenience of their own home.”

With less and less time to devote to cooking, consumers look to highly convenient soups as a source of meals, comfort and healthfulness.

Gold in Bold

Consumers, however, are not content solely with taste and also seek nutritional benefits. These benefits are unlike those of the fat-free era.

One trend is the addition of vitamins or herbs. As Mintel notes, this health-conscious and nutritious rationale presents consumers with an extra incentive to make soup a part of a healthful diet. With obesity and other health-related issues coming to the fore, manufacturers are expected to position soup as a food item that fits well with the trends toward comfort and health. Quick and convenient, soups satisfy the desire for a hot meal, and with nutritional additives, will further their perception as a nutritious meal. Vitamin C is one nutrient expected to make its way into soup, and, except for regulatory issues, Echinacea would be another natural fit.

Such value-added benefits may be essential to capture the soup consumer's attention. Category leaders are aware that both private label and smaller manufacturers have made significant inroads to market share. While they occupy only a relatively small portion of overall shelf space, some smaller companies have managed to separate themselves from the pack by emphasizing the homemade quality. According to Mintel, particularly in the RTS category, market leaders have been forced to make advancements in quality to compete.

While the RTS segment enjoys the strongest growth, that may not benefit larger manufacturers as they face intense competition amongst themselves. RTS varieties have shown over 40% sales growth in real terms from 1997 to 2002, and the segment now comprises an estimated 44% of the soup market. The steady gains are due to a vast array of products designed to appeal to more discriminating tastes and the need for convenience. The introduction of Progresso (General Mills, Minneapolis, Minn.) in the mid-1990s led to an intense rivalry with Campbell's Chunky line.

Convincing consumers to try a new version of an old favorite is difficult, but the introductions of Progresso and Chunky opened the door to soup experimentation. Campbell's Soup To Go has been a boon for those seeking a portable soup, while the improved taste and more-exotic flavors of soups from smaller companies, such as Covent Garden, San Francisco, have brought additional attention to the segment.

Condensed Sales

The approach may be working, as condensed soups saw some growth from 1999 to 2001, with a good portion of this growth among private label and smaller manufacturers. Among major condensed brands, only Campbell's Select has grown, says Mintel. Nonetheless, Mintel attributes recent overall sales declines at Campbell on a decrease in condensed soup sales, including Healthy Request.

Dry Mixes Decline

One of the primary applications for dried soups is in recipes, and informing consumers of other applications would serve marketers well, says Mintel. For instance, Knorr Vegetable Soup Mix (Unilever, Greenwich, Conn.) is among the soup products that “have achieved almost legendary status in popularizing dishes such as spinach dip.” However, despite intentions to cook more homemade meals, consumers are not spending valuable free time in the kitchen. This lack of cooking time limits the use of dried soup mixes in recipes.

A reduction in the time dedicated to cooking meals also impacts negatively on bouillon sales, which have dropped 8.3% in real terms since 1997. Typically, bouillon is a part of time-intensive meals, such as stews, and lengthy cooking sessions do not fit with busy schedules. Even when consumers opt to prepare a dish that requires broth, they often choose a canned broth rather than bouillon.

Mintel's exclusive consumer research found that over 90% of consumers eat soup of some form, while almost 50% use soups in recipes. However, this research also discovered that almost a third of respondents do not believe soup is filling enough to eat as a meal by itself. That thinking was greatest among 18- to 24-year-olds.

To combat this viewpoint, Mintel advises soup manufacturers to emphasize their product is one component of a complete meal. Additionally, Mintel believes, “There is also clearly a need to promote and emphasize the variety of soups on the market, some of which are clearly intended to be more substantial and hearty.”

Despite those efforts, Mintel predicts stagnant sales for the soup category through 2006. Slight increases in the RTS segment will not offset decreases in condensed and dry soups. Some areas do harbor opportunity, however, such as the refrigerated and frozen soup category, neither of which has been mined to any great degree. Both would appeal to consumers looking for freshness and quality—without the effort usually associated with homemade.

The innovation in packaging and flavors is expected to continue, with refrigerated soups finding increased acceptance in supermarkets as consumers seek to duplicate the restaurant experience at home. In fact, Mintel notes estimates that refrigerated soups could, eventually, account for up to 20% of the soup market in the U.S.

Flavors, meanwhile, will continue to evolve, with Caribbean Mango Soup and Butternut Squash with Granny Smith Apples among the varieties moving from foodservice into the grocery aisles. Efforts to emphasize new flavors could impress upon consumers the quality of the product, while noting that these soups still cost less than frozen meals and take-out.

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