| Breakdown
of traditional eating patterns benefits bakery products
- 17 May 2004
Author: Francisco Redruello
Despite
the historical role of bread in a number of culinary cultures,
the bakery products market is generally benefiting from a
global trend towards the breakdown of traditional eating patterns.
The
trend towards urbanisation resulted in accelerated consumer
lifestyles, increasing numbers of women in the workforce,
the fragmentation of traditional family structures and an
increase in single-occupancy households. Recent new product
developments are indicative of consumer demand for products
that ease the effects of increasingly busy lifestyles and
the consequent constraints on food preparation and shopping
time that affect consumers.
Development
of premium segment and further segmentation
The
maturity of core developed markets in regions such as North
America and Western Europe has meant growth has been increasingly
driven by the development of added-value products.
Euromonitor’s
latest global bakery products report looks at how the commodity
status of many bakery products and the growing presence of
private label offerings raised the importance of manufacturers
presenting a distinctive and focused identity for their brands.
Market conditions have appeared to increasingly favour major
players with the resources to develop premium products and
support them with extensive marketing campaigns.
Product
segmentation is also starting to play an increasingly important
part in manufacturers’ product development strategies,
leading to a growing number of products targeting specific
consumer groups such as children, young adults and the elderly.
Children
have long been targeted as a specific group, with strategies
including the introduction of child-oriented flavours, tie-ins
with movie and television characters and novelty products,
such as biscuits that colour milk when dunked.
However,
segmentation in the adult category has come in for more concentrated
attention from manufacturers recently. For example, products
with added calcium would be targeted at elderly consumers
in order to reduce the risks of osteoporosis.
Development
of bakery products aimed at the health and wellbeing segment
As
well as convenience, product innovation over the review period
also reflected the growing awareness of nutritional issues.
In most developed countries, the trend towards healthier eating,
which had been developing concurrently with that towards indulgence
products, persisted throughout 1998-2003. Consequently, the
continuing demand for premium products and the innovation
strategies of baked goods specialists focused on products
perceived to be healthy and sophisticated, such as novelty
breads.
While
development of low-calorie variants of certain foods has proliferated
throughout the review period, it became evident that the vogue
for the low-carbohydrate Dr Atkins diet has started to influence
consumption patterns. Euromonitor reveals that, despite adverse
publicity which has prevailed as the medical profession disputes
a diet that is not balanced and focuses heavily on high protein
content which includes products that are high in saturated
fats, it is likely that manufacturers may consider developing
this market niche, as the vogue for the diet shows no sign
of abating.
New
packaging formats
Packaging
innovation has also become increasingly important in bakery
products, as manufacturers have sought to adapt to changing
eating habits and demographic and social trends. The increase
in snacking has been particularly influential with regard
to packaging, leading to innovations aimed at convenience
and portability. The maturing of many markets has also meant
that packaging has become an increasingly significant factor
in generating value sales through the development of added-value
products.
For
the most part, the companies that saw success in 2002 and
2003 sought to align their product packaging activities to
accommodate busier lifestyles. Successful packaging strategies
included smaller-size packs, new zipper bag technology providing
longer storage life, key-word labelling of products to promote
health benefits, re-branding and the use of comic book and
cartoon characters to appeal to children.
Breakfast
cereal manufacturers also looked to promote bowl-with-cereal
packs to encourage cereal consumption out of the home. Euromonitor
looks at how these lines of development are likely to continue
in 2004 and beyond with further segmentation prevalent in
packaging solutions.
Gradual
but ongoing process of consolidation
Logistical
problems regarding the transportation and storage of perishable
goods and deep-rooted traditions of purchasing artisanal products,
resulting from the historic status of bread as a staple in
many national diets around the world, underpin the extremely
fragmented nature of the global bakery products market.
However,
the market has experienced a gradual, but ongoing process
of consolidation for a number of years now, and the trend
continued in 2002 as the share of global value sales accounted
for by artisanal products declined by a further 0.1 percentage
points to 46.9%.
Euromonitor
also reveals that within bakery products, private labels accounted
for an increasing share of global value sales in every area
in 2002. The increase was underpinned by the growing significance
of supermarkets in both developed and emerging markets. Although
multiple grocer penetration remained low in many developing
markets, some such as China witnessed a significant rise in
sales of private label products, as their low prices and,
increasingly fresh, in-store baking, appealed to consumers.
Improved
distribution and multinational penetration in emerging markets
The
major growth markets over the 1998-2003 period were in the
developing regions of Asia-Pacific and Eastern Europe. Common
drivers shared by such developing markets: growth from a low
base, increased urbanisation, higher disposable incomes, growing
influence of Western culture and diet, more working women,
longer working hours, more liberal economic policies and the
spread of manufacturing and distribution networks and growing
penetration of storage technology.
The
newly published global report also reveals that the development
of retail systems within Asia-Pacific are set to bring consumers
into contact with a growing variety of bakery products. Moreover,
manufacturers are expected to invest in the expansion of distribution
to the region’s vast and significant rural areas, as
urban markets become increasingly mature. Developing retail
networks and deepening multinational penetration are also
predicted to be significant factors in spurring strong volume
and value growth in the emerging regions of Africa and the
Middle East and Latin America. |
