The breakaway breakfast

Choice, choice and more choice. The number of breakfast options available to consumers in the UK seems to be growing every year. From bacon butties to breakfast bars, pastries to porridge, there’s an array of ‘good morning’ food for shoppers to get their hands on. However, this growing choice is taking its toll on traditional breakfast staples such as cereal and toast. According to Mintel research analyst Alice Baker, “fragmented eating habits have added to the woes of ready-to-eat cereals, with many cereal eaters skipping breakfast or snacking instead”.

She believes on-the-go breakfast treats and well-established cereal bars could be better placed to capitalise on consumer snacking tendencies, “while also appealing to the time-pressed”.

Many shop owners have discovered they can attract busy consumers who don’t have time for breakfast at home with new hot or chilled grab-and-go formats.

Ajay Odedra, owner of Boreham Village Stores, in Chelmsford, Essex, has done just that with his kitchen-style breakfast range.

He says: “Breakfast is a growing market for us as we have a kitchen area that sells food to go such as sausage and egg rolls that we make on site.

“People want fresh and healthy variations, too, so we have fruit 
salads, and an orange juice dispenser sits next to the coffee machine.”

Ajay uses social media to help promote his breakfasts. “We advertise on Facebook and in the local paper,” he explains, “but we also rely on word of mouth to let others know about what we do.”

Ajay believes his breakfast offering helps to create a selling point for his store, one which the supermarkets struggle to match.

“It’s a definite point of difference for us,” Ajay asserts. “You don’t see Sainsbury’s or Tesco doing coffee and breakfast the way we do.”

He’s hoping it will stay that way, too. “No trend lasts for ever, but I think for the next five to 10 years, hot and on-the-go breakfasts will continue to be popular with shoppers.”

Ramesh Shingadia, owner of two Londis stores in West Sussex, agrees. He has noticed more of his customers coming in for breakfast to take away.

“Food to go is such a dominant category at the moment and is increasing all the time. People are looking to add something to their morning coffee, such as a sausage or bacon bap. Everyone seems to want a fast breakfast.”

Even though breakfast to go is helping to drive sales in Ramesh’s stores, he is finding it harder to adapt to an evolving breakfast market.

“You have so many splits in breakfast now,” Ramesh points out. “Within food to go you have hot breakfast, protein bars and even energy drinks and shakes that some people buy to have before work. Then you have the traditional cereals and pots – it is very hard to keep up.”

Scott Graham, of McLeish Inverurie in Aberdeenshire, has been working hard to improve his cold food-to-go section by installing additional shelving under his store’s breakfast bar. Scott wants to make better use of his store layout in order to increase basket spend from shoppers on the food-to-go mission.

He says: “On the new shelving we are bringing in cereal bars, breakfast pots and other food-to-go items. We have a small range of protein snacks at the moment so we are expanding that range, too.”

Scott had been thinking of changing his breakfast offering for a while, but it’s all systems go now that a new Greggs has opened near his store.

The Greggs initially took food-to-go customers away from Scott, offering a café experience with plenty of seating, but Scott’s sales have now recovered.

Donna Morgan, of Brownlies of Biggar, near Edinburgh, is also looking to appeal to the masses with her breakfast range. She says: “Breakfast to go is now just as important as ambient cereals, and within both we make sure we have gluten-free and dairy-free alternatives. That way customers can enjoy their breakfast wherever and however they want.”

 

Clare Denham, head of category and market strategy at Danone Dairies, believes the trend towards on-the-go breakfasts has had a big impact on both the breakfast market and the yogurt category in particular.

She says: “As consumers’ lifestyles get more and more hectic they are increasingly relying on the convenience channel, including forecourts, to cater to their meal needs, and chilled yogurts and potted desserts are no exception.

“Within convenience, the category is worth £256m (IRI w/e 7 October 2017) and with the correct range retailers have a real opportunity to grow this even further.”

Denham believes millennial shoppers are driving demand for on-the-go and low-sugar breakfast formats.

“Consumers are trying to actively reduce their sugar intake,” she asserts. “Brands such as Light & Free respond to this need.”

The range is the latest addition to Danone Dairies’ portfolio and contains zero fat and zero added sugar, with only naturally-occurring sugar. “As such, it is a real game changer within the category and set to introduce more shoppers to dairy,” she adds.

Danone is also focusing its marketing efforts on its popular Activia range, available in 0% fat with no added sugar and breakfast pot formats.

 

Speciality breakfast

Edward Taylor, founder of Purition, believes stocking quality breakfast items with a healthy balance can help stop consumers skipping the meal altogether.

Purition is a natural alternative to meal replacement shakes and protein powders, made from wholefood ingredients and a vegetarian or vegan source of protein. Taylor believes his company is already tapping into the demand for more sustainable breakfast options.

“Our range offers a completely different alternative to traditional ‘healthy’ breakfast items, while also being quick and easy to prepare for those who are time-strapped in the morning,” he says.

Jordans Cereals, Britain’s number-one granola brand (Nielsen Scantrack Data 2017), is also focusing on offering shoppers a balanced range of breakfast products. The brand has introduced a new low-sugar cereal that contains less than 5% sugar.

The granola range is available in almond & hazelnut and cherry & almond flavours, each containing 1.3g and 2.2g of sugar per 45g serving respectively (rrp £3.99).

Jordans Cereals brand manager Andrew Dale says: “We have been working hard to create new low-sugar granola recipes that contain no artificial ingredients. Using chicory root fibre, the root fibre from a vegetable, we’ve created two new great-tasting granolas with less than 5% sugar.”

 

Ajay and Donna have found that offering local products among their breakfast items goes down well with their shoppers. Donna says: “We try to offer a good selection, from our food to go and breakfast cereals, to our coffee machine, quality conserves and our local honey.

“Local products are great for us and our shoppers,” Donna adds. “Customers are loyal and like buying something a bit different that they can’t get anywhere else.

“As you might imagine, being in Scotland, our porridge oats and porridge pots are very popular. The oats are produced in Glasgow and wherever possible we try to stock locally-sourced products.

“It’s a clear point of difference for us and important to our customers.”

Donna believes a good hot breakfast offering is even more crucial during the cold winter months, helping to attract busy shoppers looking for something warm and comforting to start their day.

“People make more time for breakfast at this time of year,” Donna asserts.

“Young people like to have a grab-and-go breakfast, whereas older customers will sit down to eat a bowl of cereal. Most shoppers will have something, even if it’s just a coffee.”

She adds: “It’s vital that we react quickly and make sure we know which products our customers want at different times of the year.”

Ajay agrees. “In the winter especially, people want a warm meal and this changes in the summer,” he says, “but that element of seasonality means that our breakfast range can change throughout the year.”

 

Quaker Oats brand owner Pepsico believes that the hot cereals segment can provide real growth for retailers as the category has grown 1.2% in the past year (Global Insights w/e 23 September 2017).

Eric Williams, Quaker Oats marketing manager at PepsiCo, believes at-home breakfast products are still the biggest opportunity in terms of occasion, but the growth in the on-the-go breakfast market shouldn’t be ignored.

He says: “Quaker has retained its top position in hot cereals in 2016/17 with Oats So Simple and traditional Quaker Oats together accounting for 29% of volume sales (Mintel Breakfast Cereals, August 2017).

“Longer-term growth for the hots segment has been driven by the rise in popularity of porridge, given the health credentials of oats. High protein is seen as important when buying breakfast cereals by 32% of eaters. As a result of this growing trend, we made the decision to launch Quaker Protein.

“We anticipate the mainstream popularity of protein to continue, as health remains high on the consumer agenda. Convenience will remain a big factor as well. The Quaker To Go range caters for this demand as a wholesome, satisfying and portable breakfast to kick-start the day.”

Ramesh positions his porridge pot range beside his breakfast bars and shakes, with a coffee machine alongside, so the range is one of the first things customers see when they walk through the door.

He says: “Quaker’s Oat So Simple is our best seller, closely followed by Weetabix Vanilla On The Go. The Alpen bars are also among the top sellers, which just shows that more and more shoppers are looking to switch to food to go.”

Donna has also noticed that the cereal market isn’t as big as it once was, but she says plenty of customers in her store are still looking for a cereal-based breakfast.

She says: “Cereal pots are great for us because people can just add milk or water and enjoy a breakfast while out and about. We also sell Stouts bars and protein bars on a stand next to the coffee, so customers can quickly refuel and then hit the road.

“Saving time is a big thing for shoppers, especially during the week. If people have children or it’s the weekend then they are more inclined to have the traditional cereals from Nestlé and Kellogg’s.”

Ramesh thinks that the traditional cereal market is still important to the grocery trade, but says: “Take-home cereal is more of a distress purchase now and the category has definitely come under pressure and been challenged by newer products over the years.

“We have cut the space devoted to cereals in our store because people shop daily rather than weekly now, so we have to reflect that trend in our breakfast range.

“Cereal is no longer as big as food to go,” Ramesh admits. “I think most are happier to top up their basket with a breakfast bar or breakfast drink.”

 

Big brand and pricemarked cereals are still important in Donna’s store, but speciality and local products have a higher margin and attract more loyalty from her customers, she says.

Weetabix, one of the nation’s favourite breakfast cereals, is looking to appeal to consumers looking for a natural and adaptable breakfast cereal. The brand has grown by 3% in the past year and achieved more than £150m in retail sales in 2017.

Kevin Verbruggen, head of brand for Weetabix, says: “As with many grocery categories, breakfast cereals have had a tough time over the past few years. However, 95% of UK households still buy breakfast cereals each year, on average every fortnight; and spend £1.5bn each year.

“While the market is static year on year, we’re confident that we can grow category value by focusing on our large, growing brands and by bringing NPD to market.”

Weetabix is looking to increase its appeal with its protein and On The Go ranges. The Weetabix Protein range holds a 54% share of the protein cereal sector, the fastest growing segment in the cereal category (Nielsen 52 w/e 12 August 2017).

“Developing the Weetabix Protein range has been a direct response to the increase in consumer demand for food products that help people increase their protein intake,” Verbruggen asserts. “The Weetabix Protein range fulfils this demand, offering a wide variety of products.”

Beth Reeve, brand manager for Weetabix Drinks, adds: “Consumer behaviour is changing, and the need for convenience at breakfast is becoming ever more apparent. There are 3.5 billion occasions annually where people are either skipping breakfast or eating it out of home (Nielsen 52 w/e 12 August 2017). Indeed, research shows that almost a quarter (24%) of consumers buy breakfast on the go once a week, with 42% of shoppers 
spending between £2-£3 on their breakfast mission and 34% spending up to £5 (Nielsen 52 w/e 12 August 2017).

“As such, this is a major opportunity for brands such as Weetabix On The Go, which offers a cost effective yet nutritious breakfast.”

Weetabix sold more than 18 million On The Go bottles in 2017, a 51% increase year on year.

 

Nut butters

Another popular source of protein is nut butters. Peanut butter, the fastest-growing sector within jams and spreads, has become a popular option for breakfast (Kantar Worldpanel).

In the past three years, nut butters in general have continued to enjoy growing popularity due to their versatility and perceived health benefits.

Meridian Foods, the UK’s leading producer of nut butters, is aiming to capitalise on this trend and wants to prove to shoppers that nut butters can be an easy and versatile addition to any morning routine.

The group conducted an in-depth study into shopper habits and found that half of those surveyed (49.9%) would like more variety in their breakfast options.

Helen Money, nutritionist at Meridian Foods, says: “A nourishing breakfast does not have to be time consuming, just stirring nut butter into porridge increases B vitamins, iron, magnesium and zinc, all of which are needed for energy creation.”

With so many new formats hitting the market and the growing trend towards food-to-go breakfast options, retailers must ensure they display products in the right place across their store.

James Logan, commercial director at Refresco, believes offering a mix of on-the-go and at-home items will ensure that retailers’ breakfast range suits as many consumers as possible. He says: “The weighting towards on-the-go breakfasts should be determined by the store location, customer profile and purchasing habits of shoppers. There is little point looking to capitalise on out-of-home breakfast consumption if yours is an estate shop whose customers eat breakfast at home.”

Logan believes adding products such as fruit, eggs and juices to a store’s breakfast range can help widen its appeal. “Retailers need to ensure they have the mainstream breakfast items people want to consume on the go such as pastries, milk-based breakfast drinks, yogurts, coffees and juices. These need to be front of store so they can be seen and are easy to grab and pay for.

“With inflation a concern for many, on-the-go breakfast items should be available as PMPs or packaged in meal deals. Juices are ideal for cross-category promotions – 79% of consumers buy a drink with their breakfast (Atomik Research).”

Logan believes breakfast drinks will become more popular. The milk-based drinks market, for example, is expected to reach £236m by 2020 (Canadean). “With consumers becoming increasingly time poor, and more options available, breakfast drinks will increase in popularity. Volume sales of breakfast drinks in the last year rose 37.7%,” he says.

Clare Denham at Danone Dairies sees natural health yogurts and desserts as a big growth area. She says: “Breakfast is the occasion where consumption of yogurt is increasing most rapidly. As consumers don’t want to go without the first meal of the day despite their hectic lifestyles, the breakfast on-the-go segment, in particular, is experiencing growth.

“This is where breakfast yogurts with cereals – such as the Activia Breakfast Pot – and portable active health drinks – like Actimel – come into their own, so place them at the front of store so they are top of mind.”

While many retailers are focusing on providing meal-for-tonight solutions and capitalising on lunchtime trade, it’s also wise to remember breakfast – whatever form that may take.