The increased popularity of new age snacks from other categories ranging from energy bars to dried seaweed is among threats facing the baking industry, two food trend analysts said. The insight was offered as part of a SWOT analysis presentation at the annual meeting of the American Bakers Association.
“When I first moved to Brooklyn a few years ago, mothers at the park would give their children bread or a bagel,” said Frances Largeman-Roth, author of “The CarbLovers Diet. “Now I see them giving seaweed. And it’s spreading across the country. Mothers are saying ‘no’ to white bread.”
Ms. Largeman-Roth participated in a panel with Todd Hale, senior vice-president, consumer and customer insights, The Nielsen Co.; Steve French, managing partner, Natural Marketing Institute; and Lynn Dornblaser, director of consulting, Mintel International. The panel was part of the general session of the American Bakers Association annual meeting, April 21-24 at the Turnberry Isle resort in Aventura. The SWOT analysis (strengths, weaknesses, opportunities and threats) looked at current retail and consumer trends in bread and rolls.
Ms. Dornblaser also identified competitive snack categories as a threat to baking, offering as examples cereal, energy bars, fruit, nuts and cheese.
Threats facing baking covered a wide range, as did the strengths, weaknesses and opportunities.
Several panelists mentioned increased attention to bioengineered organisms as an area of concern, and Mr. Hale said front-of-label claims, including gluten free and bioengineered-free, may pose a threat to baking.
Other threats cited by panelists included the increased popularity of consumer products even more convenient than baked foods and the growing popularity of artisanal baked foods that reinforce the image of packaged baked foods as highly processed.
Mr. French also warned that the need for constant innovation in food, including baked foods, poses a threat.
Just as they found no trouble finding multiple threats, the panelists were quick to identify numerous powerful strengths enjoyed by the baked foods category.
The magnitude of the category — $40 billion — making it one of the largest in food stands out as a significant benefit, Mr. Hale said, and Ms. Dornblaser said the industry benefits from the diversity and value of its products.
“There is something for everyone, at every price point,” she said. “Choice is abundant. There are more than 2,000 bakery products introduced each year.”
Mr. French looked at strengths from a different angle, suggesting that most consumers make food purchases with their emotions, adding that baked foods “align” well with this connection.
“One third (of consumers) state they choose foods based on whether they make them feel good emotionally,” he said.
Other strengths Mr. French mentioned was the growing popularity of whole grains products, a related association with bakery fiber, the increased popularity of artisan bread and the positive way baked foods complement the grazing/small meal trend.
Mr. Hale noted as a strength that baked foods sales are growing in value channels (e.g., dollar stores), but he headlined his list of weaknesses with the point bread and roll sales are falling in the largest channels — supermarkets. He advised bakers to invest more heavily in “channels that are winning.”
Additionally, overall baked foods sales are performing worse than other major food and beverage categories.
Weaknesses identified by the other panelists related principally to health and wellness issues. Mr. French said baked foods in general have an association with not-so-healthy products, and baked foods could be characterized as “off trend” because of a prevailing fear of carbohydrates.
Ms. Dornblaser warned that fresh bread increasingly is viewed as not so fresh. She cited data indicating about two thirds of consumers believe in-store baked foods are fresher than packaged bread. She advised bakers to counter this perception by promoting the fact bread is “baked fresh daily.”
The aging of the population was described as a weakness by Mr. Hale, who said bread is an easy target for cutting for people getting older and consuming fewer calories. He suggested bakers could adapt to the changing demographics by offering smaller packs and products with desired features such as added fiber.
Another change Mr. Hale emphasized as both a weakness and opportunity related to the strength of supermarket perimeter sales and the weakness of center-of-store business.
Adding to the woes at the center of the store has been the resurgence of grocery sales by e-commerce. Mr. Hale noted a major jump in this business through Amazon.com over the past year.
“A way to address this is collaborating with complementary categories, connecting with growing parts of the store,” he said. “In particular, there are opportunities at the perimeter of the store. Baked foods already are sold at the in-store bakery, but there are opportunities elsewhere.”
While describing “natural” products as a “cost of entry” in the minds of many consumers, Mr. French said the organic category could more accurately be described as an opportunity for bakers. One consumer in five is buying organic products, and the figure is growing, he said.
Other opportunities for bakers are to improve the nutritional profile of its products through fortification or the addition of functional ingredient, the introduction of new products with non-wheat ingredients and the success companies have enjoyed improving the quality of gluten-free products.
Also mentioning non-wheat products was Ms. Dornblaser, citing the popularity of ancient grains in general and quinoa in particular. Simplifying product labels also represents an opportunity, she said.
Increased protein was cited by Ms. Largeman-Roth as an opp0ortunity for bakers.
“Why? Because of the perception it is more filling,” she said. “Consumers worry sugar will cause a crash, but protein will help preserve muscle mass.”
Ms. Largeman-Roth also mentioned the increased popularity of quinoa as a possible avenue for bakers to pursue.
