Pre-pandemic, busy lifestyles meant ‘on the go’ breakfast options saw strong growth. However, throughout the pandemic in-home consumption inevitably rocketed as a result of the growing trend towards value for money, and this was reflected in value sales for the cereal category growing by almost 10% in 2020.
As lifestyles have become busier again following the easing of lockdown restrictions throughout the course of the year, it is expected that the trend towards ‘on the go’ breakfast options will return. However, with home and flexible working continuing as the ‘new normal’ for many, it’s likely that consumers will also continue to choose quick and convenient breakfast options in the home, and ready-to-eat cereal consumption levels and sales are likely to hold strong.
The first lockdown saw a growing trend towards consumers looking to create moments of happiness at home, which was reflected by an increase in demand for taste led breakfasts, while health simultaneously dropped down the list of consumer priorities.
However, this was a short-lived decline and we have since seen nutrition climb back above pre-2019 levels in the list of consumer reasons for breakfast consumption, with research showing that 65% of UK adults now try to eat healthily all or most of the time.
Toby Baker, Regional Marketing Director UKA – Nestlé Cereals, comments: “We are on a long-term and ongoing reformulation journey to improve the nutritional profile of our cereals, and recently announced that 59 million teaspoons of sugar are being removed from family favourite brands including Coco Shreddies, Frosted Shreddies and Nesquik as part of our latest efforts. By employing a staggered ‘salami slice’ approach to reformulation – with small and gradual reductions of salt and sugar to maintain the same great taste – there will be up to 16% less sugar and 50% less salt across these brands by the end of the year.”
Outside of health concerns, the pandemic has also impacted many UK households financially, meaning that saving money has also inevitably became more important to shoppers. With the average bowl of cereal costing just 15p per bowl, cereal remains a low cost, convenient option for consumers. As a result, we have seen volume per household grow, and the cereal category has been able to boost its volume growth.
Nestlé Cereals recently announced the launch of Cheerios Vanilla O’s, a new breakfast cereal containing less than 5% sugar. The tasty, low sugar vanilla flavoured rings offer consumers a high fibre breakfast option without compromising on taste. The cereal also contains no artificial colours and flavours and is fortified with vitamins and minerals.
The product is classified as non-HFSS (not high in fat, salt or sugar) under new government regulations and has whole grain as the number one ingredient (86% whole grain). With the UK’s recommended average fibre intake for adults set at 30g per day, offering consumers the option of breakfast cereals containing whole grain is an easy way for them to increase fibre intake.
The launch of Cheerios Vanilla O’s also follows the release of Shreddies The Simple One earlier this year – a new take on the family favourite brand. Made using just four simple ingredients of whole wheat, banana puree, date syrup and a pinch of salt, the product has been designed to offer a delicious breakfast option for health-conscious consumers.
“Nestlé Cereals products continue to be family favourites within UK households, and we currently hold just under 20% of the market share,” says Baker. “Every year our value performance, sales and market share increase, but throughout lockdown we found that it was our core, traditional brands that sold best. Our Shreddies, Cheerios and Shredded Wheat breakfast cereals consistently performed well, however this isn’t surprising given these are trusted brands with a long-standing consumer following in the UK.”
“Wholesalers are incredibly important for us as a business, and we are always looking to develop our existing relationships, while also forming new ones,” adds Baker. “Our sales team works to foster and grow these partnerships, in order to find new, and innovative ways to work together and build effective business plans to benefit us all.”
Darryl Burgess, Head of Sales for Weetabix, comments: “ The cereal category is worth £72m in the total impulse category and Weetabix remains the UK’s number one breakfast cereal brand. We’ve worked closely with our wholesale partners to ensure product availability over the past year, as well as offering advice to retailers so that they stock the top-selling cereal brands to cater for the rise in at-home breakfasts.”
Weetabix has invested in the category as well, with NPD such as Weetabix Melts, available as a £2.99 PMP, and Weetabix On The Go Caffe Latte, which launched exclusively in the impulse channel and was supported in deports with world-class POS displays to drive interest and engagement.
Cereal brands performed really well during the pandemic, suggesting people were looking for familiar products during a period of uncertainty. Weetabix Original performed well and sales for Weetabix Minis Chocolate also rose 44%.
“Consumers have returned to cereal because of its versatility – it’s quick and convenient but can also be personalised with additional toppings and different milks, which taps into the trend for personalised breakfasts,” says Burgess. “Breakfast has become more of a social occasion in the past year, with 53% eating more together as a family. Younger people have also returned to the breakfast table, with a 2.8% increase in cereal consumption compared to 2019 – a recent study has found that younger people have found the lockdown has helped them reconnect with their family as they cook and enjoy more mealtimes together – and that they wish to continue this going forward.”
Health will come back to the forefront in the months ahead. There will be more looking to lose weight following their lockdown diets, whilst improving general health and immunity will be a focus – 80% say they will make greater attempts to stay healthier as a result of Covid-19.
All Weetabix-branded products are HFSS compliant, including the more indulgent products such as Weetabix Chocolate, Chocolate Crispy Minis and the new launch Weetabix Melts.
“With a ban on HFSS promotions on the horizon, it’s important retailers are confident in offering healthy options to consumers that can still deliver growth for their stores,” adds Burgess. “Products such as Weetabix, Ready brek and Alpen Light Bars are therefore must-stocks from a breakfast perspective. Our strong nutritional values also mean we can continue to invest in marketing to ensure Weetabix is front of mind for consumers.”
Weetabix grew by +£12million in 2020 and is still firmly the UK’s number one breakfast cereal brand, bolstered by an increase in cereal consumption with more at-home breakfast occasions, as well as a spike in online shopping and bigger pack purchases. Weetabix Original is and will always be, a low sugar cereal, and we have all green traffic lights on pack to make it easy for shoppers to make a healthy choice.
Ready brek, the £10million smooth porridge brand, returned to TV screens this year as it brought back its popular ‘Central Heating for Everyone’ campaign. Ready brek is outperforming the category in both value and volume, growing at 5.8% year-on-year compared to just 1% for the total hot cereals’ category. The rise in awareness of the health benefits of oats has certainly helped to increase demand, with people making healthier choices at breakfast.
Weetos, the wholegrain chocolate hoops cereal which is currently valued at £15m and growing at 31% year-on-year, unveiled a fresh new look this March. The refreshed packaging outlines the brand’s sustainability credentials, with all cocoa used for the wholegrain cereal certified as sustainable by UTZ.
Alpen has recently unveiled a new brand campaign, Up & Alpen’ to celebrate its 50th birthday. It has returned to TV for the first time in over four years and unveiled new eye-catching packs to standout in-store. A White Chocolate, Raspberry & Shortcake variant has joined the Alpen Light range, appealing to UK consumers who are looking for healthier snacks. The brand’s last two pieces of NPD, Salted Caramel and Jaffa Cake are now its best-selling SKUs.
Weetabix On The Go remains the UK’s number one breakfast drink – 70% of its consumption is in the home and the brand has shown resilience in adapting to new ways of living.
Charlotte Hulbert, Sales Manager, Brioche Pasquier, comments: “There is no doubt that brioche is now firmly established as a staple product for many households. The slightly sweet taste and soft texture is popular with children, and families are using it for a wide variety of breakfast dishes. French toast is an obvious one, given brioche’s French origins. But it is also great as straightforward toast with spread, under eggs and avocado instead of conventional bread, or with bacon as a sandwich. French bakery as a whole is doing well, with Croissants and Pains au Chocolat also popular.”
Brioche fits into the Viennoiserie category which is doing well as a whole during the pandemic with a 15.8% increase in sales overall (Kantar). Brioche Pasquier is the country’s favourite brioche brand, and market leader in brioche branded products.
“Healthier eating is perhaps the key trend that has emerged from the pandemic,” says Hulbert. “Highly processed food is increasingly under scrutiny, and parents in particular are concerned about what they are feeding their children, whatever the time of day.”
Clean labelling is an increasingly important factor for wrapped bakery products. Consumers are concerned about their health, and additives like preservatives, unhealthy fats, artificial flavourings and colourings all signal a red light to those who want to eat simple, clean bakery products.
Brioche Pasquier updated its packaging and advertising last year to make sure it is clearly communicating that its products are baked with recognisable, wholesome ingredients like fresh eggs from uncaged hens, flour, butter, no artificial colours, preservatives or flavours. Its individually wrapped products also help to allay concerns with hygiene.
“Our new Pancakes can be eaten as they are or stacked with delicious fruit and honey or with bacon and maple syrup,” adds Hulbert. “They are great for family breakfast, being quick and easy to prepare, and children love them.”
The eight soft and sweet pancakes in each packet come conveniently wrapped in twin packs which makes it very easy to pop a pack of two into a bag or pocket to a lunch on the go.
The packaging also means that there is no need for waste as the remaining pairs stay fresh in their twin packs. They have Brioche Pasquier’s usual long shelf life of up to 21 days and yet are free of preservatives, hydrogenated fats and artificial colours.
Like all Brioche Pasquier products they are baked from wholesome ingredients like fresh eggs from uncaged hens, fresh butter and milk. The pancakes are suitable for vegetarians and have been made to a traditional recipe by expert bakers.
For new products and to drive brand penetration, Brioche Pasquier regularly uses in-store promotions to support its product range. In 2021 the brand built on the success of a previous collaboration with the most successful animation franchise of all-time, Illumination’s Minions, giving customers the chance to win a family holiday to Universal Orlando Resort, and thousands of instant-win Minions goodies.
Stéphanie Brillouet, marketing director, Délifrance, comments: “Breakfast is an important time for bakery, in fact, more than half of consumers eat their pastries at the start of the day, according to research for our Prove It: A Viennoiserie Focus report. Previously enjoyed on-the-go or dining out, 34% of consumers increased at home pastry consumption during lockdown. This explains why retail sales of frozen bake-at-home pastries, which were already growing pre-lockdown, reached triple-figure percentage growth.”
Meanwhile, Délifrance’s Great British Bakery report revealed that 61% of consumers eat bread at breakfast time. With increased appetite for bread with inclusions, or using alternative flours, more consumers are seeking health benefits in their bread. This has driven greater variety in the category. And because these consumers are less price sensitive, retail is able to charge a premium for healthier options.
The health & wellness trend continues apace and, as well as vegetarian and vegan options, consumers are interested in rye and alternative flours as well as seeded breads and pastries.
Over 30% say eating healthily has become a higher priority since the start of lockdown and, even when choosing indulgent pastries, consumers are considering portion size.
“Indulgence remains an important driver in the bakery category,” says Brillouet. “Health & wellness extended to self-care during the pandemic, as consumers looked for little treats to cheer themselves up or reward themselves. These consumers are looking for items such as chocolate viennoiserie, filled croissants, sourdough breads or breads with inclusions.”
Délifrance’s Hotel F&B research revealed that 61% of consumers are still opting for indulgent pastries at breakfast. However, this is balanced by 63% who want to see mini pastries available – allowing for both indulgence and variety.
“Now is a good time for wholesalers to look at the depth of their offer and portion sizes to cater for their changing customer needs,” adds Brillouet. “Consumers are becoming more interested in ingredients and baking in the home, so expectations of what they can buy in-store will be higher. To lure customers back into the fresh bakery aisles, retailers will need to offer unique, high quality yet competitively priced products that are hygienically packaged and rival independent bakeries.”
Amy Burgess, Senior Trade Communications Manager at Coca-Cola Europacific Partners GB, comments: “Although hot tea and coffee have traditionally been Brits’ go-to at breakfast time, people are increasingly looking for new ways to get a much-needed pick-me-up to start their morning, such as ready-to-drink (RTD) coffees.”
The sector is worth more than £190m and is up in value by 30.6%, making it the fastest-growing segment in soft drinks.
“We expect the sector to get a further boost as shoppers look for a chilled caffeine hit on their way into the office, to enjoy alongside traditional breakfast snacks such as pastries and cereal bars,” says Burgess.
Within this Costa Coffee RTD has increased in value by more than one third in the past twelve months, and more than half of Costa Coffee RTD shoppers are new to RTD Coffee, which is helping to drive additional sales for wholesalers.
This success can be put down to the strength of the Costa brand and the quality of what’s in the can. The Costa Coffee RTD range is a ‘coffee-first’ (low milk and sugar) proposition making it an appropriate pick-me-up to enjoy every day. The products are all less than 50% milk, which gives it a real point of difference in a market that is predominantly at least 70% milk, and contain 30% less sugar than its competitors, allowing another of its USPs – Costa’s signature Mocha Italia blend – to shine through.
The core range for convenience is Latte, Caramel Latte and the newly launched Vanilla Latte and Flat White.
Paul Baker, Founder of St Pierre Groupe, comments: “Shoppers are looking for products that offer versatility to help minimise waste and cater for multiple meal occasions. They want foods that offer taste, convenience, versatility, and good value, so there is an opportunity for bakery brands, with long-life multi-pack formats, like those from St Pierre, Baker Street and Paul Hollywood. Products that offer an extended shelf-life will be a must-stock for wholesalers, as they have become increasingly popular with consumers since the beginning of the pandemic. They also enable wholesalers to provide a strong bakery offering throughout the year, minimising the risk of wastage.”
All of the St Pierre Groupe brands offer an extended shelf-life, which is resulting in growth across the board. The brands are now worth £35.8m and have enjoyed 16.5 per cent growth in the L4 weeks, making it the second fastest growing bakery supplier (Nielsen).
“The bakery category has reached sales worth £3 billion for the first time with year on year growth of 5.5 per cent (Nielsen), so stocking a wide variety of items which meets the demands of the consumer offers huge potential for wholesalers,” says Baker. “To help maximise basket spend and overall sales, wholesalers should look to be strategic with their in-store merchandising as this will encourage upselling.”
The temporary closure of coffee shops, cafés and restaurants in the first lockdown has had a lasting impact on the way we consume breakfast and brunch. As a result, more people have been, and will continue to, replicate their favourite out of home dishes at home and make recipes that they’ve discovered in the last year. This trend has helped drive sales in the £1.1m morning goods category (Nielsen) – particularly for St Pierre which lends itself perfectly to elevated breakfast meals thanks to its range of tasty brioche loaves and rolls, Belgian waffles and croissants. Morning goods as a category has been the least affected by the pandemic, remaining in growth throughout (Nielsen).
Consumers have also become more experimental with their flavours and are seeking out new ingredients as a result. Research from Hearst shows that during the lockdown 33 per cent of people cooked a new cuisine, which, combined with the fact that meal occasions have changed so much, has meant that bolder flavours have started to become popular with breakfasts. For example, adding ‘heat’, which was previously not often considered for breakfast, will become more commonplace.
Take-home value sales of hot beverages also jumped more than 13 per cent in the 12 weeks to 12 July (Kantar) and this has had a long-lasting impact on sales, with consumers continuing to recreate the café experience at home. The St Pierre individually wrapped range, which comprises Butter Croissants, Chocolate Filled Croissants, Brioche Waffle, Millionaires Waffle, Pain au Chocolat and Caramel Waffles, complements the take-home coffee trend perfectly. It also provides attractive margins for retailers, meaning it can work effectively as part of or alongside a hot drink fixture. The fresh, individually-wrapped bakery products can be consumed with any meal occasion, providing a strong sales opportunity. The items also have the added benefit of an extended shelf-life, which helps to reduce the risk of wastage in-store.