Growth Strategies in Bakery and Cereals: Key trends and future product opportunities

Published by: Business Insights

Published: May. 1, 2007 - 134 Pages

Table of Contents

Growth Strategies in Bakery and Cereals

Executive Summary

Market developments

The bakery and cereals market

Innovation and NPD

Key trends in bakery and cereals

Conclusions

Chapter 1 Introduction

Research methodology

What is this report about?

Report structure

Chapter 2 Market developments

Summary

Introduction

The role of bakery and cereals in the obesity debate

Healthy line extensions of indulgent brands

Importance of high quality ingredients

Opportunities in healthy indulgence

Increasing the importance of breakfast

Taking an ethical interest

Chapter 3 The bakery and cereals market

Summary

Introduction

The growing potential of the bakery and cereals market

Bakery and cereals market value in Europe and US

Value of the bakery and cereals market by category

Bread and rolls

Breakfast cereals

Cakes and pastries

Cookies

Crackers

Morning goods

The bakery and cereals market volume and growth, by country

Company shares

The dominance of artisanal producers and private label

Top 10 innovative bakery and cereals companies in the world

Case study: Sara Lee

Chapter 4 Innovation and NPD

Summary

Introduction

Share of new product launches within bakery and cereals

Category analysis

Bread

Case study: Hovis

Cakes

Cereals

Cookies

Crackers

Mixes and other baking

Regional analysis

Europe

Asia-Pacific

Americas

Middle East & Africa

Future growth potential by region

Innovative bakery and cereal brands

Formulation

Positioning

Packaging benefit

Case study: Alara

Innovation by category

Product tag analysis

Flavor trends

Chapter 5 Key trends in the bakery and

cereals market

Summary

Introduction

Health

Natural and fresh

Low fat / low calorie

Functional

Glycemic Index

Indulgence

Gourmet and luxury

Private label

Home cooked meals and authentic ingredients

Convenience

Eating out and on-the-go

Impulse purchasing

Customization and individualization

Targeting children in today’s highly sensitive market

Chapter 6 Conclusions

Summary

Introduction

Innovation opportunities, barriers and solutions

Health

Indulgence

Convenience

Targeting consumer groups

From breakfast-time to all-the-time

Index

List of Figures

Figure 2.1: Healthy line extensions - offering choice to the consumer

Figure 2.2: Combining health and indulgence in new products

Figure 2.3: The importance of ethical trends in bakery and cereals NPD over the next 5 years

Figure 3.4: Bread and rolls, sub-category segmentation by value, 2009

Figure 3.5: Breakfast cereals, sub-category segmentation by value, 2009

Figure 3.6: Cakes and pastries, sub-category segmentation by value, 2009

Figure 3.7: Cookies, sub-category segmentation by value, 2009

Figure 3.8: Crackers, sub-category segmentation by value, 2009

Figure 3.9: Morning goods, sub-category segmentation by value, 2009

Figure 3.10: Bakery and cereals market value versus volume forecast, 2009

Figure 3.11: Bakery and cereals top 5 company shares, (%), by region, 2004

Figure 3.12: Market shares of artisanal and private label manufacturers, (%), by region, 2004

Figure 3.13: Company types expected to have the most influence on innovation levels in bakery and

cereals now and in five years

Figure 3.14: Sara Lee EarthGrains bread

Figure 4.15: Share of bakery & cereal product launches, by sector, 2004-2006

Figure 4.16: Percentage growth in market value bakery and cereal categories are likely to

experience over the next five years

Figure 4.17: Bread products made with natural and healthy ingredients

Figure 4.18: Hovis products

Figure 4.19: Innovative frosting products

Figure 4.20: Innovative cereal products

Figure 4.21: Right Direction Chocolate Chip Cookies

Figure 4.22: Healthy crackers

Figure 4.23: Crayola Crafty Cooking Kits

Figure 4.24: Percentage share of bakery and cereals products launched by region, 2004 versus 2006

Figure 4.25: New product launches in Europe

Figure 4.26: Gluten Free Choc Cake Mix

Figure 4.27: New product launches in the Americas

Figure 4.28: Anytime Crumpet Mix

Figure 4.29: Regions expected to experience the most growth in bakery and cereals market value

over the next 5 years

Figure 4.30: Innovation in formulation - Sultana Hartig

Figure 4.31: Bimbo Mr Dipps

Figure 4.32: Alara’s packaging

Figure 4.33: Percentage of innovative bakery and cereals products launched in each category, 2004-

2006

Figure 4.34: Buitoni Fresh Rolled Dough

Figure 4.35: Pasco Mainichi Seni Bread

Figure 4.36: Flavors and ingredients that will experience the most growth usage in bakery and

cereals over the next five years

Figure 5.37: Importance of health trends in bakery and cereals NPD over the next five years

Figure 5.38: Yaya’s Raw Rah Organic Kracker

Figure 5.39: Barilla Fratelli’s Molino Bianco cereals

Figure 5.40: Low calorie and portioned products

Figure 5.41: Sales growth potential of bread types over the next five years

Figure 5.42: Country Harvest Prairie Bran Loaf

Figure 5.43: Importance of indulgent trends in bakery and cereals NPD over the next five years

Figure 5.44: Duchy Originals gourmet bread and biscuits

Figure 5.45: Gourmet private label bakery products

Figure 5.46: Bob’s Red Mill Gluten Free Bread Mix

Figure 5.47: The features of most importance to the success of a bakery or cereal product

Figure 5.48: Dai Ichiya White Café Ogura Milk

Figure 5.49: Impulse product for the on-the-go breakfast market

Figure 6.50: Vitalicious Foods

Figure 6.51: Tohato’s Tohato Hitokuchi Kuro Goma Cream Sando Biscuit

Figure 6.52: Frozen Fruit Filled Snack Pie called Pie-Oh-My!

Figure 6.53: Consumer groups expected to provide the most sales growth potential for bakery and

cereal manufacturers over the next five years

Figure 6.54: Sales growth potential of consumption occasions for bakery and cereal manufacturers

over the next five years

Figure 6.55: Nestlé’s Ski Up & Go

List of Tables

Table 3.1: Value of the bakery and cereals markets by key product markets, $m, Europe and US,

2005-2009

Table 3.2: Value of bakery and cereals market by category and sub-category, $m, Europe and US,

2005-2009

Table 3.3: Volume of the bakery and cereals markets by key product markets, kg m, Europe and

US, 2005-2009

Table 3.4: Top 10 innovative bakery and cereals companies

Table 4.5: Diversification within the Hovis bread range

Table 4.6: Bakery and cereal product innovation by type, 2004-2006

Table 4.7: Top 25 product tags on new product packaging, % of bakery and cereal products

launched, 2004-2006

Table 4.8: Top 20 flavors in bakery and cereal product launched, % of product launches, 2004-

2006

Table 5.9: Percentage and total number of natural and fresh (including organic) food and drink

consumers by usage status, Europe and US, 2004 and 2009

Table 5.10: Percentage and total number of natural and fresh (including organic) food and drink

consumers by usage status, Europe and US, 2004 and 2009, continued

Table 5.11: Family structures across Europe and the US, (m), 2000-2005

Table 6.12: Innovation opportunities and potential barriers in bakery and cereals NPD to 2009

Abstract

To maintain and develop market share, bakery and cereals manufacturers have been forced to address the ‘staple’ image of their products. In doing so, manufacturers have innovated by reformulating to make products more indulgent, fortifying products with functional ingredients to make them healthier and developing innovative delivery methods. ‘Growth Strategies in Bakery and Cereals: Key trends and future product opportunities’ is a new management report published by Business Insights that analyzes the drivers and major trends currently influencing the bakery and cereals market including health, premiumization, guilt-free indulgence, convenience and ethical consumerism. This report provides detailed market insights at global, regional and category level to forecast trends accurately to 2009. Best-practice examples of new products launched between 2004 and 2006 are assessed and recommendations are made for future innovations. Create more effective new product development strategies and increase returns on investment with this new report.

Business Intelligence for the Consumer Goods Industry Business Insights' portfolio of consumer goods management reports are designed to help you make well informed and timely business decisions. We understand the problems facing today's consumer goods services executives when trying to drive your business forward, and appreciate the importance of accurate, up-to-date, incisive product, market and company analysis. We help you to crystallize your business decisions. The strength of our consumer goods research and analysis is derived from access to unparalleled databases and libraries of information and the use of proprietary analytic techniques. Business Insights reports are authored by independent experts and contain findings garnered from dedicated primary research. Our authors' leading positions secure them access to interview key executives and to establish which issues will be of greatest strategic significance for the industry. Our consumer goods portfolio of reports can be used across a wide range of business functions to assess market conditions and devise future strategies and cover the food, drink, health, cosmetics, toiletries, dairy categories and key consumer issues including eRetail and marketing.

Some key findings from this report

• The US will show the strongest growth in market value at 14.1% between 2005 and 2009 to reach a higher overall value than is forecast for France, Germany, Italy, Sweden and The Netherlands.
• The cookie category held the largest share of total new product launches in the bakery and cereals sector in 2006 (33.1%). Pastries and baked goods held second place, falling from 23.5% in 2004 to 19.2% in 2006.
• Nearly a third of industry survey respondents stated that the breakfast occasion will offer the most growth potential for manufacturers over the next five years driven by new products including ready to eat and on-the-go cereals and health concerns relating to obeisty and other health issues.
• Kellogg is the most innovative bakery/cereals company according to industry executives with nearly a quarter of respondents selecting Kellogg as the most innovative company. Nestlé was in second place at 10.3%.

Growth Strategies in Bakery and Cereals

Key trends and future product opportunities. To maintain and develop market share, bakery and cereals manufacturers have been forced to address the ‘staple’ image of their products. In doing so, manufacturers have innovated by reformulating to make products more indulgent, fortifying products with functional ingredients to make them healthier and developing innovative delivery methods.

Growth Strategies in Bakery and Cereals: Key trends and future product opportunities is a new management report published by Business Insights that analyzes the drivers and major trends currently influencing the bakery and cereals market including health, premiumization, guilt-free indulgence, convenience and ethical consumerism. This report provides detailed market insights at a global, regional and category level to forecast trends accurately to 2009. Best-practice examples of new products launched between 2004 and 2006 are assessed and recommendations are made for future innovations.

Create more effective new product development strategies and increase returns on investment with this new report.

This new report will enable you to:

• Assess the key trends in bakery and cereals innovation based upon this report’s analysis of Productscan data from over 10,000 product launches between 2004 and 2006 detailing regional contribution, category coverage and product claims.
• Benchmark leading executives’ opinions on the future of bakery and cereals innovation using this report’s analysis of our proprietary global survey detailing the key issues affecting the future of NPD and innovation in the bakery and cereals market.
• Predict future growth areas in bakery and cereals using this report's forecasts to 2009 of market values and volumes by category and sub-category across Europe and the US.
• Target new and emerging market opportunities using this report’s extensive analysis of the most innovative new product launches, trends in NPD and convergence.

Key issues examined in this report:

• Healthy and tasty. Bakery and cereals products can be positioned as healthy, indulgent or healthy and indulgent. Manufacturers are increasingly opting to extend their brand portfolio to satisfy each of these consumer demands.
• Ethical consumerism. Issues such as food miles, organics and Fairtrade are driving consumers to question the provenance - and quality - of their food and drinks.
• Rise in homebaking and cooking from scratch. From 2004 to 2006 the share of bakery and cereal product launches in the ‘cake mixes, frosting and decorations’ category increased from 1.6% to 3.6% and the ‘mixes, baking and other non-baking’ category rose from 4.6% to 4.9%.
• Opportunities in targeting snacking occasions. 10% of industry executives rated mid-morning as the consumption occasion that will offer the most sales growth potential over the next 5 years, whilst 1% believed mid-afternoon and 4% evening.

Your questions answered...

• Who are the leading players in the bakery and cereals market?
• How will the rise in ethical consumerism impact on the bakery and cereals market?
• What are the most popular and successful flavors used in bakery and cereals NPD?
• Can brands target other consumption occasions such as snacking without losing share of the breakfast market?
• How can bakery and cereals brands target children effectively without attracting criticism or regulatory interference?
• Which is the leading category in terms of NPD over the past two years?
• Which countries offer the best opportunities for investment?

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