Cash in: Cereal bars - Play the field

Manufacturers are working hard to provide a cereal bar suited to every occasion. Tracy West takes a tour of on-the-go bars to afternoon treats

There’s good news and bad news when it comes to cereal bars. The good news, according to Mintel, is that in the six months to February 2011, three in five adults had eaten cereal, snack and energy bars. They were chosen as an on-the-go snack because they were viewed as being more nutritious than chocolate or crisps. The bad news is that the two in five adults who don’t eat them see them as expensive and unappetising.

That said, according to Kantar data, cereal snacks are purchased by 70% of households. And IRI data (52 weeks ending June 18, 2011) reveals that the cereal snack market is worth £406m and is growing by 3.2%. And as for ‘expensive’ and ‘unappetising’, manufacturers have been offering c-store retailers pricemarked packs to communicate value and encourage trial, while ever more indulgent flavours are being added to ranges many containing chocolate!

According to Mintel, Kellogg’s captures nearly £2 in every £5 spent on cereal and snack bars. Jennie Miller, category insight controller at Kellogg’s, says the beauty of cereal snacks is that they meet a wide range of shoppers’ needs. “A Nutri-Grain bar is an ideal solution for a missed breakfast, while a Special K bar is perfect for a mid-morning snack in the office. And Rice Krispies Squares are a more indulgent treat for people looking for a tasty snack.”

She says the Rice Krispies Squares brand is worth £37m and is growing 9% year on year (IRI 52 weeks ending June 18, 2011), with marshmallow and totally chocolatey the two biggest selling variants.

 “This year more than three million households have purchased Special K snacks (Kantar 52 weeks ending June 12, 2011). The brand is worth £33m (IRI) making it the top ‘shape-watching’ cereal snack brand in the UK.”

The range was boosted with the addition of Special K double chocolate in June. Containing just 99 calories it’s billed as ‘the tasty treat you can enjoy without feeling guilty’.

Unlike many other Kellogg’s launches, Special K double chocolate went first into c-stores before the grocery multiples. Lee Doherty, head of specialty at Kellogg’s, explains: “This new Special K cereal bar is an indulgent and chocolatey treat ideal for weight-watching women looking for a tasty snack choice, so it was ideal to launch as a single bar first as we wanted to take it out of the missed breakfast purchase and into tasty snacking territory.”

Kellogg’s recommends the following core range for c-stores: Rice Krispies Squares totally chocolatey marshmallow and chocolate caramel; Nutri Grain Soft Bake strawberry and apple; Elevenses Raisin Bake; Tracker chocolate chip; Special K Red Berries; and Crunchy Nut peanut crisp.

 “The ideal home for cereal snacks is between crisps and confectionery,” says Miller. “We find that shoppers want to see cereal snacks products grouped together by need enjoyment, health and functional.” 

She adds that Kellogg’s offers a variety of pos material for cereal snacks including counter-top, clip-on and freestanding units.

Although it’s often assumed that cereal bars are most often eaten as breakfast replacements, General Mills UK sales director Andy Foweather says snacking remains the key usage occasion. But he adds: “Versatile cereal bars with a wide range such as Nature Valley do offer a number of different uses. Our consumer research has shown us that Nature Valley is consumed 81% of the time with a drink, 31% of the time with a sandwich and 33% of the time with fruit, showing us that the lunchtime occasion is also big for the brand.”

He says the Nature Valley brand has been building on the success of its multipack format by investing in single bars in the independent/convenience channel.

He adds: “The distribution drive on this format is delivering increased efficiency and easier merchandising in store. Retailer feedback has played a pivotal role in the brand’s decision to push pricemarked packs and ‘ready-to-display’ cases, as these are the elements that retailers felt aided them in driving impulse sales.

“Pos material has also been provided to drive standout, visibility and awareness in store.”

He says trial is key to driving growth. “There is a real need to ensure that Nature Valley bars continue to be merchandised on the cereal bar fixture and, where possible, on a secondary location at the till point or with confectionery, to really drive that impulse purchase.”

In the spring, Nature Valley’s roasted almond variety was replaced by ginger nut. The rationale behind the replacement, says Foweather, was that ginger is a distinct ingredient that consumers instantly recognise, and new flavour launches can really help to shake up the category and encourage shoppers to try something new.

“New flavours are key to driving trial in the healthier biscuits category, and we are confident that ginger nut will prove a real hit with consumers and continue to help Nature Valley achieve the great sales figures we have seen in recent months,” he says.

Kerry Fuller, brand manager at Dorset Cereals, says the upcoming back-to-school season is important for the company as cereal bars are a popular lunchbox filler.

“Cereal bars are now in one in 14 UK lunchboxes, but growing faster than any other item up 41% in the past three years (Kantar Worldpanel data). If cereal bars continue to grow by 41% over the next four years, they will be involved in one in every 10 lunchboxes that’s 122 million more lunchboxes,” she says. 

Fuller adds that Dorset Cereals doesn’t aim its products at children, but rather their parents who want a tasty snack for their children, made using “nothing scary”. “However, we do make sure that our recipes taste amazing and are totally family friendly hence our apple & raisin and blackcurrant, cherry & raspberry flavours,” she says.

“The nutritional information for our bars is clear on all packaging and we make products that taste great and are always honest about their contents. We make sure that all of our ingredients could be found in the kitchen cupboard.”

Fuller says Dorset Cereals is supporting the convenience sector by developing new impulse cereal bars and handy muesli packs specifically for it. “We have also invested in new people to focus on ensuring our products get as much exposure in this market as possible.

“We are currently working on improving distribution on our range of three everyday cereal bars (available in five-bar multipacks) and our new impulse cereal bars, which are a fantastic lunchbox product. We have two recipes: blackcurrant, cherry & raspberry and almond, brazil & hazelnut.”

She advises c-store retailers to think about running a lunchbox ingredients promotion similar to the meal deals run for lunchtimes and evening meals.  

Finally, new to convenience store shelves is the Nakd range of cereal bars from Nature Balance Foods. Available for some time through the grocery mults, the bars are now listed by Palmer & Harvey.

The all-natural snacks are a combination of raw fruits, nuts and natural flavouring. They are all dairy-, gluten- and wheat-free.

The move into convenience is part of the company’s strategy to ensure Nakd builds on its growing mainstream appeal. Jamie Combs, managing director at Natural Balance Foods, comments: “Consumers are becoming increasingly savvy and are starting to look for natural, less processed products that are healthy and tasty.

“We think that Nakd offers the holy grail products that are genuinely good for you, aren’t packed full of additives, preservatives and glucose syrups, and taste great. We’re confident they provide convenience outlets with an offering that’ll result in strong sales.”