Wrapped in richness

The appetite of consumers continues to grow for premium food products and there are a number of theories as to why this trend is growing.

Lynn A. Kuntz, Editor In Chief

May 1, 1994

25 Min Read
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There's been a new trend emerging in the last several years in this country: The consumer's appetite for premium food products is on the rise. In just about every food category, a manufacturer of high-quality, high-priced products has carved out a nice slice of the market.

There are many theories as to why this trend is growing. Some see it as a result of more discretionary income in certain population segments, such as teens and the elderly. Other see it as a backlash against the policy of the last decade, where any kind of culinary indulgence was a sin – either a sign of conspicuous consumption or a first class ticket to an early death.

In addition, the scientific community seems to be sending conflicting signals regarding the deleterious impact certain types of foods have on health. (See this issue's cover story, Fact or Fad? Nutritional Breakthroughs to Know About.) First: cholesterol-containing, but undeniably tasty, butter causes coronary heart disease. Better switch to margarine. Now: watch out for those trans-fatty acids found in margarine. You're better off with butter.

According to Paula Lambert, president of the Mozzarella Co. in Dallas, it may be that during a depression or recession, food becomes a way that people can reward themselves. In a relative sense to other luxury items, food costs much less.

Whatever the reason, the American public is ready for a treat. And the food designers of the world are ready and willing to comply with this demand.

Primo products

Pinning down the exact definition of premium and super-premium products challenges those looking for a tidy phrase. Originally, super-premium was applied to a few select categories -- ice cream, for instance.

"Within the ice cream industry, the way we define super-premium is that it contains at least 15% butterfat, high solids in the 40 to 45% range and low overrun, in the 20% range," explains Peter Lind, primal ice cream therapist for Ben and Jerry's in Waterbury, Vermont.

But as with the old practice of giving laundry detergent packages labels like "King Size" or "Super Humungous Mega-Box," these terms can cause a lot of confusion. The consumer often considers lean meats as conveying a premium image. In reality, a significant consideration of the USDA quality grading system for red meats is the amount of fat present. Since fat contributes to the palatability of these meats, the higher grades contain more fat.

"In my opinion, super-premium means a higher quality product," states Ken Pavichevich, president and chief executive officer of Pavichevich Brewing Co. in Elmhurst, IL. "Not the perceived quality achieved through a marketing image. For example, many of the beers categorized as super-premium in this country shouldn't actually be included."

While advertising and market positioning don't necessarily make a premium product, most everyone will agree that they share several important characteristics:

Consistent, high quality.

High quality ranks number one. The product has to deliver on that promise and deliver it constantly.

"Right now consumers are very value conscious," notes Dicki Lulay, director of business development for Nabisco Foods Group, Food Service Co., Parsippany, NJ. "They're less likely to experiment, but they will pay a premium price if they know the quality is there."

Because premium pricing goes along with premium product, consumers will be less likely to make a repeat purchase, should they find something wrong.

"You have to keep customer expectations in mind," advises Ed Minson, manager of research for Ambrosia Chocolate Co. in Milwaukee. "Expectations are typically higher for expensive boxed chocolates. Someone who pays $35 per pound for fine chocolates is going to be looking for perfection."

Appealing flavor, texture and appearance

In a premium product, Minson contends, all sensory properties "are fine-tuned to the optimal level." This harkens back to the issue of quality. However, while something like oat bran may be a high-quality product, its appeal may be limited when stacked up against a tender, aromatic cinnamon bun dripping with icing.

"No matter what approach the industry takes to sell a concept." says Terry Emmel, manager of flavor development for McCormick & Co., Hunt Valley, MD, "if the product doesn't taste good, it doesn't go anywhere."

Flavor is one of the most important attributes. Ethnic or specialty flavors are often good candidates for the category. Blueberry is nice, but wild Maine blueberry is better. Szechwan indicates premium much more readily than chop suey. Merely adding pepper to make something spicy won't, if you'll excuse the pun, cut the mustard. Flavors should be blended and smooth, but generally not bland.

"Novel concepts and exotic flavor profiles often categorize these products," says Emmel. "If a customer requests 'nut flavor,' he may be happy with a peanut or generic, nondescript flavor. Premium may require something like roasted macadamia. It gives an entirely different connotation, and conjures up the right image in the consumer's mind."

Product texture can signify premium. Again, it must deliver on the promise of quality. Super-premium ice cream must be smooth, rich and creamy. Baked goods must taste fresh and have the appropriate mouthfeel: soft, chewy or crunchy. In fact, the majority of premium products need to mimic the attributes of a fresh or homemade target. For instance, in pies the fruit filling should be firm and maintain its identity; the crust should be flaky, not soggy.

No matter how good a product tastes, if the appearance does not live up to a superior standard, the consumer will not consider it a premium product. Often, manufacturers can use regular production equipment and achieve the desired appearance, especially if uniformity is key. Sometimes machines just are not capable of delivering the correct appearance.

The right packaging for premium products serves two purposes. First, it protects the product. Secondly, it conveys an image to the purchaser. Often, premium products require superior protection to preserve a high quality throughout the shelf life.

Several characteristics of premium products can affect their shelf stability. They may contain higher levels of fat, rendering them subject to oxidative rancidity. Sometimes they contain higher moisture levels and with it, the related problems. They may be formulated to produce all-natural labeling. This can mean no preservatives or the use of sensitive ingredients like natural colors. Also, manufacturers want to maintain a superior quality level throughout the life of the product. In some cases, the established shelf life relative to its standard counterparts will be shortened to achieve this.

"Our dijon mustard does carry a six-month shelf life," notes Steve Crandall, senior product manager, Grey Poupon Dijon Mustard, Nabisco Food Group. "It's not that it goes bad on you; we pull it because it is not at peak flavor."

Several techniques extend the shelf life of these products. Better barrier packaging limits the incursion of oxygen and moisture. Opaque or translucent packages reduce the chance of light-induced deterioration, such as oxidation or color fading. Using modified or controlled atmosphere packaging technologies can extend the shelf life of many products, especially fresh refrigerated foods like pasta and cheese. Using the proper balance of oxygen, nitrogen and carbon dioxide inhibits microbial growth, preserves color and limits oxidation. Smaller packages often ensure that the product is quickly consumed once opened.

"I'm a fanatic on date-stamping," Pavichevich maintains. "You can drink our beer way beyond the date on the package, but it's an indicator of the general freshness. A readable date allows the consumer to know that the product has not been kept on the shelf for a year, and that the flavor has not deteriorated."

Another key to packaging products in this category is using the packages to convey a premium image. Upscale materials like foil or glass give the consumer a visual perception of high quality. Graphics should not result in a generic look.

While upscale packaging connotes premium, it is not always necessary. If selling a product like "Billy Bob's Mom's Down Home Country Biscuits," a glitzy package would only create confusion. But no matter what the look, sloppy packaging will not promote the image.

"Premium" ingredients

It's a corollary to the maxim, "garbage in, garbage out": premium products contain premium ingredients. This can mean a number of things, but always the underlying characteristic is high quality.

The ingredients used project a certain image. Lobster bisque is more likely to fit into the market than tomato soup. Certain factors distinguish these types of ingredients: superior flavor and texture, rarity and wholesomeness. Often, regional or varietal factors help the image – for example, New York Cheddar, French Bordeaux wine and Valencia oranges. Adding high-quality branded ingredients with the right image helps to place products in the premium category. (See accompanying sidebar, Riding on Premium Coattails.)

In addition to quality, Emmel names several factors often requested for ingredients added to premium products: all-natural, kosher and unique.

"Unique ingredients may only be available from one source or one region of the world, and there may be a very limited supply, , explains Emmel." They are not used as often and typically deliver a different flavor profile. Through processing, flavor companies can often mimic these qualities. That way we can produce flavors that would otherwise be cost prohibitive.

"With vanilla, for example, the species and origin are very important," Emmel continues. "Bourbon vanilla sourced through Madagascar has the highest connotation of quality. But in many cases you can taste vanilla from different sources, side by side, and to the untrained palate find people who prefer vanilla from Indonesia."

Establishing a close relationship with ingredient suppliers helps to ensure high-quality ingredients. Some companies go as far as becoming their own suppliers for certain ingredients to guarantee the quality, but this is not necessary.

"We've built up good relationships with our fruit growers over many years," notes Nabisco's Robert Anstine, business director of the foodservice division. "We contract for the fruit in advance and work with them to minimize variations from year to year."

One trend many of these products currently follow is using natural and healthy ingredients. Consumers often consider artificial ingredients to be inexpensive and of lower quality than their natural counterparts, whether it is true or not. Although the consumer perceives ingredients like butter and eggs as unhealthy, they are more widely accepted in this category. Purchasers look on these products as an indulgence, and these types or ingredients can reinforce this concept. Besides, they taste good.

"Using natural flavors can sometimes be difficult, especially certain ones that must undergo certain processes," Emmel professes. "For instance, it's hard to come up with a natural cheese flavor that will withstand high heat processes. Natural ingredient sourcing for flavor may cause problems. Also, sometimes superior flavor profiles come from artificial ingredients. Methyl thiobutyrate adds quite a bit of character to cheese flavors, yet it's not available naturally."

As with the food industry in general, anything perceived as a chemical promotes a certain degree of undesirability to a sizable portion of the population. This can often limit the use of ingredients – especially colors, preservatives and other functional ingredients – providing the product designer with certain formulation challenges. Often, these can be overcome with careful ingredient selection: use of natural antioxidants like tocopherols and rosemary extract or use of natural colors. These can't be used indiscriminately: natural colors can fade or change colors under certain conditions; rosemary imparts a characteristic flavor.

More expensive

Since consumers consider premium products as an indulgence, they are more willing to pay higher prices for them as long as they receive consistent high quality. This is fortunate because premium ingredients, stringent quality standards, specialized or intensive processing, "hand-crafting," shortened shelf life and small scale very often cost more. Often, premium products contain more ingredients and less water or air per pound. But the upcharge varies greatly.

"Premium products usually have two aspects: high prices and high quality," notes Leonard Marsh. president and chief executive officer of Snapple Beverage Corp. in Valley Stream, NY. "In our case, we manufacture what we consider a premium quality product. but our price is just slightly higher that any other soft drink. When you're doing this volume of business, manufacturers have a tendency to try to save a penny or two by changing to cheaper ingredients – that can add up to a lot of money. They convince themselves that they still have the same product. We might compromise on the cardboard case, but we'll never compromise on what goes inside the bottle."

Whether a product is categorized as a premium product is often a matter of perception. Marketing can create a premium image where one does not exist with techniques such as advertising and upscale packaging.

"You can sometimes find products that are not as organoleptically superior as others in the category," notes Minson. "But if it's good quality and the customer enjoys eating it, the market may allow you to pack it in a shiny box and charge a higher price."

A product party

Premium products can be found in categories from soup (clam chowder from famous restaurants) to nuts (specialty mixtures or specially seasoned). They come from large conglomerates and can be found on any supermarket shelf. Or they may have limited production and be round only regionally or in specialty stores or restaurants. Each category and each manufacturer puts something extra into the product to differentiate it.

Soft drinks

One of the hottest premium categories today contains a proliferation of products, from specialty mineral waters to "New Age" beverages. One manufacturer, Snapple Beverage Corp., manufactures a line of natural, uncarbonated fruit drinks and teas.

"Our position is that the ingredients we put into our product won't hurt you," Marsh discloses. "There's a lot of concern today by consumers as they become more educated that many of the additives and preservatives may not be taken in safe doses. At the same time, it's a refreshment beverage, so you should enjoy drinking it."

The flavors are chosen to reflect universal appeal and current trends. For the iced tea, Marsh uses a full-bodied brewed tea. He contends that this is key to having a well-rounded flavor and that fruit flavors are chosen so that this taste comes through.

"We've recently introduced a Mango Madness variety," Marsh offers. "We want flavors that the general public enjoys. Certain flavors can go out of fashion. Right now apricot is out, peach is in."

Marsh is bullish on the inert qualities of glass packages, but admits it can create some problems. "We believe glass holds the quality better than any other material. You can have breakage and all the other related problems, but you minimize that with the manufacturing and quality control processes. We do produce some of our beverages in aluminum cans, but that's driven by our customers. You can't take a glass bottle to the beach or send your children to school with them."

Confectionery products

In the confectionery industry, in order to be considered super-premium, all of the sensory attributes have to be considered top-notch, according to Minson.

In chocolate, one of the most important features is texture. The particle size of the ingredients controls this characteristic. There is some disagreement as to how small the particles must be untiI the human tongue can no longer distinguish a difference.

"In chocolate, just a few ten thousands of an inch can make the difference between a really wonderful texture and something that comes across as coarse," claims Minson. "It depends on usage, however. If you're talking about a cookie drop, it doesn't have to be quite as fine as with candy -- you're eating it in conjunction with a coarse cookie. We grind down to about 10 to 15 microns in a chocolate coating for example, but some people contend that the threshold is 20 microns.

"Grinding to a smaller particle can be more laborious," he continues. "For example, the finer the grind, the closer the rolls are to each other. That leaves a narrower channel and you get less throughput. In the second step, the conching process, where you run the product under high temperature and high shear, you need to run the product for a little longer time to fully evaporate off the off-flavors produced in the fermentation process. It will drive off more moisture, resulting in a smoother flowing product. These kinds of things also drive the price up."

The second major aspect is flavor. Both ingredient sourcing and processing techniques influence how chocolate tastes. Some steps drive off undesirable flavors, such as the astringency contributed by the organic acids produced during the fermentation process. Roasting and conching produces the desirable flavor generated by the browning reactions.

"People often consider some of the imported products as super-premium, but that's their niche," explains Minson. "If you're going to ship it half-way around the world, you had better start out with a superior product."

"Although hand-crafting is frequently the sign of premium products, in many cases it's due to the small scale of the operation," relays Minson. "You can make a very high-grade product with automation, as long as large-scale manufacturers watch their process closely."

Ice cream

Super-premium ice cream contains a higher milk-fat content, more solids and less air. The overrun in this category falls into the 20% range versus 50 to 100% in standard products. A product with 20% overrun incorporates 10% air. These factors help to produce ice cream with a richer texture and better flavor.

"Natural ingredients are pretty important in this category," Lind states. "The only artificial ingredient that comes to mind in our product is the vanillin used in the Heath Bar pieces. Since it's part of the candy, it grandfathered itself into the ingredient legend. The ingredient statement is one of our formulation considerations."

Trying to keep the ingredients natural and the ingredient statement simple can present a challenge. Lind explains that adding ingredients like coffee may require a change in formulation to account for the high level of ingredient required to flavor the product. Otherwise, the finished product would contain inappropriate levels of sugar or solids. Some ingredients, such as large fruit pieces, can push the limits of the manufacturing process or how well the ingredient is distributed throughout the product.

"Because it's a frozen product, it's fairly stable and the shelf life is actually better than lower grades of ice cream," declares Ben and Jerry's Lind. "We've done tests showing that low overrun and high solids increases ice cream shelf life. We note the shelf life of our ingredients. too, and try to incorporate them into the product as soon as possible while they are relatively fresh. Most of our products are packed in pints, a little in quarts, so they are consumed fairly quickly after opening. Ben actually puts a disclaimer on the quarts saying that the product should be eaten very quickly because it's a larger size, and self-defrosting home freezers are brutal on the quality."

Creating ice cream novelties can cause some difficulties, according to Minson. "Heavier coverage can make it a little more difficult for dipping in the ice cream plant. In many cases, manufacturers rely on the temperature of the ice cream to harden the coating, not cooling tunnels. This works fine with a thin coating but can cause problems when the coating is thicker," he contends.

Breads and baked goods

"In the dessert category, we're seeing a lot of growth at the high end," states Anstine. "Gourmet cakes and pies are probably growing two to three times faster than the general dessert categories."

What goes into these types of products? This is one area where premium means richness, and indulgence means putting aside the food-related health fears. Anstine cites the high shortening content of the Plush Pippin pie crusts as one of the reasons for the quality. In this case, fat plays a functional role by increasing the flakiness and tenderness, as well as contributing to enhanced flavor.

"We're very stringent on our fruit specifications," Anstine discloses. "The ones we use are much tighter than the government's. For instance, we require that our cherries have a bright, red color, but there is no government specification for color. This way we don't have to add any coloring agents."

Processing to manufacture a premium dessert can involve more labor. Extra steps, hand embellishments and other methods may be necessary to achieve a higher quality.

"We have our fruit blend overnight with the spices and related ingredients," explains Anstine. "For standard pies, the manufacturers just add the fruit, starch and spices to the dry pie shell. Our method really develops the flavors of the pie. For our meringue pies, we use hand labor to peak the meringue."

Even though desserts are treated as an indulgence by the consumer, products with the perception of naturalness are still important. According to Anstine, that is why no preservatives are added to the pies.

The consumer's growing desire for products that not only taste good and exhibit superior quality, but that also are nutritionally sound, takes us to the opposite end of the premium spectrum. Natural Ovens of Manitowoc, Manitowoc, WI, manufactures a line of specialty baked goods to fill this segment of the market.

"To me, a super-premium product should be super nutritional," professes Paul Stitt, Natural Oven's president and chief executive officer. "A food manufacturer should take responsibility for the consumer's health. At the same time, baked goods should taste good and not be gummy. Most bakeries haven't even looked at putting in a load of highly beneficial ingredients. But it's really quite easy to formulate a bread that does -- to make a bread with as much calcium as dairy products, for example."

These products contain high levels of nutritional components such as fiber, omega-3 fatty acids, vitamins and minerals. Some ingredients used, including whole grains, can require changes to the traditional processing methods.

"Normal bread enrichment doesn't even add back the nutrients removed from the whole grain," explains Stitt. "There's no fiber added back at all. The formulas we use have slow water absorption -- you simply cannot make the bread as fast. At best, you end up with a dough that is quite sticky: so it is more difficult to run. The temperature tolerances can be different. The resulting dough can have an unpredictable behavior from day to day, even if all things are constant. You need to make a lot of processing adjustments and pay constant attention to the process because there are dozens of ingredient interactions that can affect how well it runs. You can only automate to a certain extent. A lot of people in the industry tell me that what I'm doing can't be done."

The normal process variations seen with processed flour can be worsened with the use of whole grains. Differences in soil, climactic and storage conditions show up more readily, according to Stitt.

Adding vitamins increases the formulation difficulty. For instance, high levels of calcium can result in a chalky flavor. It may also lower the pH and impact the gas production of the yeast.

Storage and handling of these breads differ from the standard supermarket product. They are more fragile and subject to breakage. Because they contain no preservatives, they must be put into oxygen and moisture barrier packaging. Stitt maintains that this gives the products approximately three days shelf life as opposed to four or five gained by other products.


The beer market contains a number of products marketed under the super-premium banner, but there is a lot of disagreement as to what kinds of products actually qualify.

"Some of the so-called super-premium beers contain ingredients like corn," asserts Pavichevich, who produces a regional brand named Baderbrau. "A beer such as ours conforms to the German Purity Law of 1560, that only allows four ingredients: water, barley, yeast and hops. We have no additives, adjuncts or chemical preservatives. There's no formaldehyde, no sodium metabisulfite.

"Hops act as a natural preservative, so we use a high level of a high-quality ingredient," he continues. "You do not have to pasteurize beer. When you pasteurize beer, you take away some of the natural flavor. Plus, our stringent sanitation lessens the chance of contamination. We have a five-month shelf life on our product."

In addition to the ingredients and processing, Pavichevich attributes the shelf life to the packaging used. Beer degrades from exposure to UV light and he contends by using amber bottles, 97% of the UV light is blocked. Because beer is subject to oxidation, it is necessary to use packaging that is impermeable to oxygen.

"In our caps, we use a patented membrane that was originally developed for the U.S. Navy to absorb oxygen from water in submarines," he notes. "Our brewmaster worked with this to perfect a liner for the crowns that prevents oxidation. All beers are best kept cool, but these Smart Caps allow us to keep the product on the shelf at room temperature."

Sauces and condiments

"Walk into the condiment section of any gourmet or specialty shop and you can see how this category is growing," notes Anstine. "Balsamic vinegars, flavored olive oils, mustards and sauces are all extremely popular."

Again, ingredients and manufacturing processes can define the product. Since these are used to enhance the flavors of other foods, achieving the correct flavor blend is critical.

"What sets Grey Poupon apart from any other mustard made in the United States," Crandall asserts, "is that we continue to manufacture under the same guidelines that were established originally in Dijon, France. We utilize mustard seed grinders that are made in France. We have stringent ingredient specifications for our mustard seeds and only use kosher white wine."

"We've developed a barbeque sauce that is fat-free and lower in sodium than any comparable product on the market," claims Jeff Sanders, president of Roadhouse, Inc., in Des Plaines, IL. "Our sodium content, 86 mg per serving, gives us a competitive advantage – most others are around 400 mg per serving. We developed the product without a lot of salt; we use other ingredients – sugar, pineapple, etc. – to enhance the flavor."


"There are a lot of specialty cheeses made in this country; they're often made by hand or by smaller companies," notes Lambert. "They are becoming more available in the marketplace. A lot of European cheese companies have set up shop in this country and make specialty cheeses on a larger scale."

The types of cheeses more likely to fall into the super-premium category tend to encompass the less usual varieties or styles. Lambert's company manufactures fresh mozzarella as well as other types -- traditional Italian cheeses, goat cheeses, etc.

"Typical mozzarella found in the United States is a hard, low-moisture product," declares Lambert. "It can stay in the supermarket for months Ours contains a high-moisture level, making it soft and giving it superior textural properties, but shortening the shelf life. I actually went back to Italy to learn how to make fresh mozzarella. All dairies use high-quality ingredients, it's a matter of what you do with them that makes a difference. We make small batches and constantly monitor them every step of the way."

Because many premium-specialty cheeses contain goat or sheep's milk, ingredient availability may become a problem, too. According to Lambert, goat's milk is not readily available 12 months of the year. Unlike cows, goats have a variable lactation cycle, producing more milk in the spring than in the winter.

Quality is key

"Creating a premium product is a matter of picking out the right raw materials and taking the care throughout a laborious process," Minson advises. "Mainstream products are already 90 to 95% there. It's the extra attention to detail that takes you to 99% – that results in a premium product."

Although premium products are often considered niche products, these days they appeal to the general public.

"Quality is not a niche," states Pavichevich. "It's the trend of the nineties. Now the consumer is more educated and will be looking for real quality, not a perception created by marketing and advertising dollars."

Riding on premium coattails

The market is seeing a proliferation of products using branded ingredients, including those conveying an upscale image. Those using premium brands more easily project a premium image themselves and can command a higher price.

"Having a brand with a premium image telegraphs to the consumer that this is something they can be comfortable with," contends Steve Crandall, senior product manager, Grey Poupon(tm) Dijon Mustard, Nabisco Foods Group. "Seeing a name like Grey Poupon on a product gives them permission to spend the extra money. The other advantage is the length of time a product like this has been associated with a premium image."

Usually, the brand will be associated with an existing consumer product. In order to use this type of product, the food processor must enter into a licensing agreement with the ingredient supplier, and there are a number of factors that go into using a brand name.

"We do not license everybody that comes to us," Crandall notes. "It has to be a very high-quality product. We do not want to dilute the image of our brand."

According to Dicki Lulay, director of business development for Nabisco Foods Group, Food Service Co., Parsippany, NJ, companies that seek to use Nabisco-branded items have to maintain the quality image in the finished product.

"We've established partnerships with certain companies to ensure this happens. When we license our trademark, we request product samples to evaluate characteristics, including flavor and packaging. In this way, our customers receive the quality they expect from our brands. We also want to make certain the ingredient is appropriate for the product. We wouldn't want someone to use SnackWell's(tm), for instance, in a product unless it met specific nutritional and quality criteria associated with this brand."

There can be various ways to use the branded items. "Brand X Chicken Fillets," "Chicken Fillets made with Brand X." According to Lulay, the first method requires a license because the trademark equity is used to describe the product.

"The second phrasing is used when a company does not want to license our brand trademark," says Lulay. "They're advertising that they're using our brand as an ingredient in the product."

If the ingredient in question doesn't work out in the formulation for some reason, don't look to the manufacturer to alter the existing product while allowing the use of the brand name. Manufacturers with an established high-quality product will not compromise the brand name to provide someone else with an ingredient. They are often willing to supply a different, unbranded ingredient, however.

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