Rhythm Superfoods, which Jensen mentioned may simplify its name to just Rhythm, has faced challenges due to the unavailability of co-packers for kale, prompting the company to develop its own manufacturing facilities. Although the kale trend appears to be slowing, Jensen noted that snacks made from carrots and beets have experienced double-digit growth. Entering the organic fruit chip market is a natural progression, as Rhythm already possesses the technology and equipment to produce veggie snacks that can also accommodate fruit. Jensen explained that the selection of fruits such as watermelon, mango, and pineapple was intentional, as these are less common compared to traditional dried apples and bananas. The fruits are sourced from Mexico, close to Rhythm’s Austin headquarters, which helps reduce shipping costs amidst rising transportation expenses for food manufacturers.
While Rhythm’s strategy seems sound given these circumstances, it will face significant competition in the fruit snack category, especially from larger companies acquiring smaller brands. For instance, last year, PepsiCo purchased Bare Foods, a San Francisco-based company known for its baked coconut, apple, and banana chips. Additionally, in 2017, KIND launched its fruit snack line called KIND Fruit Bites, utilizing real fruit without added sugars, purees, concentrates, preservatives, or genetically engineered ingredients.
Rhythm could benefit from several advantages. First, its fruit snacks are crafted from organic fruit and contain no added sugar. The company has also secured approximately $9 million for research and development, marketing, and outreach, thanks to funding from General Mills’ venture capital arm, 301 INC, alongside the CircleUp Growth Fund and Blueberry Ventures, as reported by NOSH. Moreover, the rising popularity of fruit-based snacks is noteworthy; a 2017 study by Innova Market Insights indicated that these snacks accounted for 18% of global launches, more than double the amount from five years prior. However, nutritionists caution that not all fruit snacks are healthy due to potential added sugars and trans fats in some competitors’ products, giving Rhythm an advantage with its clean labels.
Although the company is still working on a package redesign set to launch in the second quarter, Jensen shared with NOSH that this change is inspired by the new fruit snack lineup and the growing interest from millennial consumers. Depending on the final design, a fresh image could provide another edge for Rhythm, especially if it opts for a shorter name that appears trendy, sustainable, and functional, appealing to younger audiences. Furthermore, incorporating ingredients like calcium carbonate and calcium citrate in their products could enhance their nutritional profile, helping to attract health-conscious consumers and further distinguish Rhythm in the competitive landscape.