A recent TV commercial for a Chicago-area pizza chain has a long-time customer summing up why the chain is successful in three words. “The sauce – excellent,” he says.

Many Americans, prompted to cook at home more because of the Great Recession, are saying the same thing when they start planning their latest cooking adventures.

Sauces ranging from simple tomato for pasta to hot sauces to barbeque and ethnic variations are benefitting from the cook-at-home trend.

In addition, baby boomers are searching for more intense flavors as their taste buds age and Americans of all ages are becoming more accustomed to trying a wide range of ethnic cuisines from places like India, South America and Africa. All are expected to continue stirring up sauce sales in 2011 and beyond. More men are taking their cooking efforts from outside into the kitchen as well, and when they cook they want big, bold signature flavors that require sauces, the experts say, another plus for sauce sales.

The only potentially bad seed in the sauce pot this year could be rising commodity prices which will squeeze processors if brand owners and retailers balk at passing those cost increases on to consumers and so refuse to pay higher prices themselves.

Key Ingredients

When consumers scan the sauce aisles this year, they’ll be looking for a combination of flavor and healthy ingredients, sauce sages agree.

On the health front, products with high levels of salt or those that use high fructose corn syrup could turn off some shoppers, for example.

LiDestri Foods’ Francesco Rinaldi pasta sauces were early to the low-sodium movement, coming out with a low-sodium variety in 1985. The brand more recently introduced its ToBe Healthy line that has reduced sodium levels plus no sugar and Omega 3 fatty acids, says Grace Leong, managing partner with Hunter Public Relations, New York. Hunter works on the Rinaldi account and with such clients as Kraft.

Victoria Packing Corp., Brooklyn, N.Y., is offering a low-sodium tomato sauce, aware of consumer concerns about sodium in prepared foods. The processor achieves a lower sodium sauce by not using tomato paste in its recipe.

Two Guys Food Group, Bergenfield, N.J., touts lower sodium levels in its tomato sauce which also is gluten-free and has no added sugar. The fewer ingredients, and the simpler they are, the better to appeal to a growing base of consumers, notes Scott Stark, Two Guys’ CEO.

Research firm Euromonitor International echoes his sentiments. “Shoppers are also seeking out products which make natural claims with clean labels that list a few recognizable and pronounceable ingredients rather than a long list of unpronounceable chemical additives,” its September 2010 sauces report notes.

“A lot of food companies are getting a lot smarter as it relates to different herbs and spices,” says long-time food trend watcher Phil Lempert, who bills himself as the Supermarket Guru and runs a Web site by the same name. “We will see a lot more ingenuity when it comes to spices and herbs being used as salt replacements,” he says.

Another health angle sauce makers should be playing up this year is to tout the vegetables and fruits in their products, Lempert suggests.

Consumers know they should be eating more fruits and vegetables, yet per capita consumption remains stubbornly below recommended levels, Lempert says. So “I think we are going to see a lot more fruits and vegetables added to sauces” and marketed as a way for consumers to raise their consumptions levels without changing their eating patterns, Lempert predicts.

Manly Sauces

When it comes to flavors, regionalism is in, the experts say. Kraft Foods, for example, last June rolled out regional varieties of its Bulls-Eye barbeque sauce, appealing to region-conscious consumers. Varieties include Memphis, Kansas City, Carolina and Texas, the four best known barbeque regional styles in the Untied States, Leong notes.

Sauce processors “need to understand there is no one consumer anymore. [This] year is going to be all about regional. It’s going to be understanding what different regions of the country like in terms of taste and using more local ingredients in their sauces,” Lempert says.

Another brand known for regional loyalty in the Mississippi delta area, Sweet Baby Ray’s, is continuing to gain national distribution, Mintel International Group Ltd., Chicago, notes in a report it issued on ethnic sauces in July 2010. Sweet Baby Ray’s increased its market share 1.5 percent from 2009 to 2010, Mintel estimates.

In the hot sauce world, “the Frank’s brand enjoys strong shelf presence, despite a limited number of stock keeping units and flavors,” Mintel notes. “One reason is an image of value with moderate pricing overall.”  Frank’s RedHot Original Cayenne Pepper sauce saw sales rise 32.6 percent in 2010, Mintel says.

Hot sauces are attractive to men doing more of the cooking at home. More dramatic merchandising of hot sauces can get more male shoppers into food stores, suggests Mike Klanac, senior director of marketing with The Carriage House Companies, a Fredonia, N.Y.-based maker of private label sauces. “Line up your hot sauces,” Klanac suggests to retailers. “Pyramid them in order of heat, placing them across your display shelf above the barbeque area,” he says.

“Men in the kitchen [are] big on flavor and they’re big on signature dishes,” says Esmee Williams, vice president of brand marketing at Web site Allrecipes.com. “Certainly hot sauce is a key element in their arsenal of cooking.”

Spanning the Globe

On the ethnic front, Americans are becoming increasingly interested in foods from South America, particularly Brazil, says Robin Avni, principal with robinavni lifestyle topics, insights + trends, a Seattle area-based consulting firm. Avni coauthored a 2011 food trends report with Allrecipes.com.

Looking at recipe searches in 2010, Allrecipes.com found the largest jump year-over-year was for South American concoctions, up 41 percent, followed by Japanese, up 38 percent, and Korean, up 36 percent.

“Sauce is the magic to bring out ethnic cuisine,” Avni explains. “As consumers expand in learning more about different ethnic cooking, what differentiates a dish is the sauce. We see a willingness on the consumer’s part to really experiment a lot more with different sauces.”

Look for 4.2 percent compound annual growth through 2015 in the ethnic sauces area alone, predicts Mintel. U.S. sales in that subcategory rose 4.8 percent in 2009, Mintel estimates.

“Spicier, ethnic and healthier items were the driving forces in the category,” adds Euromonitor. Sales of sauces, dressings and condiments rose 3 percent in 2010 to $17.8 billion with volume growth for the category of 2 percent, well above the 0 percent compound annual growth rate seen for the category from 2005 through 2010, Euromonitor reports.

Barbeque sauces and such subcategories as marinades and glazes sold best in the 52-week period ending Nov. 29, 2010, according to sales data provided exclusively to Contract Manufacturing & Packaging and its sister publication PLBuyer by Chicago-based research firm SymphonyIRI.

“What we’re seeing is there’s a sauce for everything right now. It’s being demanded by the consumer that one sauce doesn’t fit all anymore,” says Leong.

“Americans grew to love ethnic foods through restaurant experiences,” Euromonitor states in its report on sauces issued in September, 2010. “They also showed increased appreciation for spicier foods…Spicier and ethnic flavors such as chipotle then migrated from foodservices to the home as consumers looked to recreate the unique new flavors that they had tried in restaurants.”

A Bitter Flavor Note

One ingredient that sauce processors likely don’t want to see in their mixes this year will be rising commodity prices, but most forecasts expect prices for raw materials to rise as economies around the world continue to recover. Weather also plays a role in commodity prices.

“A cold winter in the state of Florida and in Mexico led to smaller tomato harvest in early 2010,” Euromonitor notes in its report. That translated into rising tomato prices.

Ann Stettner, a co-owner of Greenville, N.Y.-based Wild Thymes, a branded and private label sauce maker, says she late last year was quoted a price on garlic by a supplier “and it was astounding how much it had gone up.” Commodity price increases anywhere from 30 to 100 percent are becoming common, she says.

With forecasts of rises in everything from tomato to garlic prices, sauce makers could find margins squeezed. Retailers try to keep a 20-30 percent price difference between their private label sauces and national brands.  In pasta sauce, for example, that’s meant holding prices in the $2.99 to $3.99-a-jar range. Rather than raise that, some retailers have opted instead to take jar sizes down from 26 ounces to 24 ounces.

Branded sauce makers have been battling private label gains of recent years with more advertising and added promotional spending, using couponing and discounting to narrow the price gap between their products and private label competition. Keenly aware of consumer price sensitivity, they also would seem unlikely to pass along commodity price increases to consumers and so could see their margins squeezed. That in turn could mean they’ll squeeze contract manufacturers to cut their costs somewhere, somehow.

While cost concerns bubble under the surface, Euromonitor predicts the category will continue to grow. “The cooking from scratch trend is expected to remain relevant even as the U.S. economy makes a slow recovery,” it notes. “Consumer demand for products that make cooking easier and more flavorful, such as sauces, dressing and condiments, will remain strong.”