We British love our bread. Indeed to borrow and rework a line from a certain brand’s commercial – it’s as popular today as it’s always been. The Atkins and other no- or low-carb diets came and went but bread is still here in many shapes and sizes.
Steven Mackintosh, managing director of specialist bread company Mantinga, reckons the bread market will always be strong as long as it adapts to the evolving tastes of the consumer. “For example, in the current economic climate, the consumer is looking for value for money as well as convenience and at Mantinga we are sourcing products which fit these criteria. Fortunately, as we source across Europe, we have the flexibility to find the right product, at the right time and price. Even though these trends are ever changing there will always be the demand for the classics such as the farmhouse loaf, floury bap or traditional French baguette. It seems men still prefer white bread.”
The company does not have a presence in cash and carries but instead uses a number of strategically-placed delivered wholesale businesses.
Mackintosh explains: “As small independent retailers and caterers find it increasingly difficult to leave their premises to purchase from cash and carries, the wholesale market is growing, providing an all-in-one delivery solution. As the independents are a target sector for us, the wholesale market is key, representing around 17% of our sales revenue. Wholesalers allow us a solution to the enquiries we receive across the country and it’s a good margin business with a point of difference for them.”
He says one or two wholesalers, such as Capps Foods in Lowestoft and Pannio in Devon, have become “virtual subdivisions of Mantinga” and champion the products to give their business an edge over national and local competition. “We have even had prospective customers calling in asking for the phone number of ‘our Lowestoft office’,” he says.
Mantinga’s most popular products are premium loaves with a point of difference, cost-focused sandwich carriers. “In addition we have seen a marked increase in morning goods such as patisserie and bagels as the consumer demands convenience and treats as the “on-the-go” lifestyle continues to grow,” says Mackintosh.
Nick Brown, products manager for Best-in at Bestway, reports that bread is still in the top three items of top-up shopping for consumers in c-stores after milk and chilled foods. He’s pretty upbeat because consumers who are tightening their belts are increasingly turning to own label products. “In any recession in the past, bread has always been a key product and Bestway does not believe this recession will be any different. It is a basic product that most consumers consider to be an essential,” explains Brown.
Meanwhile, Isabelle Davis, marketing manager at 3663, reckons the focus on healthy eating has been a significant factor behind the growth in the bread market in recent years. “According to Mintel, three out of 10 adults are always looking for healthier bakery options while just one in five is trying to cut back their consumption. The sector has also seen an increase in value sales of brown and wholemeal breads. And consumers trading up to premium, speciality breads has opened up a whole new area of the market. 3663 offers a large range of traditional and speciality breads, rolls, bagels, baguettes, paninis and tortillas, to help provide your customers with the choice required to supply today’s health conscious consumer.”
Warburtons is one company with a good track record for adapting its range to meet consumer demand. For example, it offers a selection of functional/healthier products with a variety of benefits. Its Wholemeal Fibre Boost 800g includes extra fibre with just one serving (two slices) providing over a third of the guideline daily allowance of fibre. While All in One 600g is a soft white bread that contains all the wheatgerm goodness and fibre of wholemeal.
And Warburtons’ commitment to new product development shows no sign of abating. A new addition to its range is Tasty Grains amp; Seeds – a white loaf which contains malted wheat flakes, sunflower seeds and brown linseed.
The 600g loaf size is new to Britain as, until last year, loaves of bread were only allowed by law to be sold weighing 400g or in multiples of that weight. An EU Directive changed all that, allowing bakers to bake their bread at any size.
Warburtons’ 600g range comprises Wholegrain Goodness, ‘All in One’ Medium, Tasty White and Tasty Grains amp; Seeds. The company is promoting the line-up with a comprehensive support plan including consumer media, in-store promotion and retailer loyalty schemes.
But Warburtons’ best-selling SKU remains the Toastie which, according to Nielsen figures, also takes the title of UK’s favourite loaf with 184 consecutive weeks as the top selling wrapped bread SKU in the UK, now worth over £133m in annual sales.
SPREAD IT ABOUT
Most people like to spread something on their bread, and according to Nielsen data, they’re doing this more and more. Figures for the 52 weeks ending March 21, 2009, show that the butters, spreads and margarines (BSM) market is enjoying value growth of 12% and is now worth £1.2bn.
Stuart Ibberson, group brand manager for Anchor and Lurpak at Arla Foods, says butter is a staple item and is not seen as a luxury, so it should be able to withstand our current economic difficulties. “Butter could also benefit from more people cooking from scratch rather than going out to eat or buying expensive chilled ready meals, and also from people taking their own sandwiches to work for lunch.”
Victoria Tate, Arla BSM category manager for convenience, says the wholesale sector is incredibly important to the company because convenience stores account for over 12% of the BSM market. “Block butter and spreadables continue to dominate in c-stores, with block growing at 10.4% and spreadables at 6.7%. Lurpak Spreadable 250g is now the number one SKU in the convenience sector, with Anchor block also in the top 10.”
She adds that regionally, the Lurpak brand performs particularly well in Scotland and the North, while Anchor’s heartland is in the South, although both brands are growing across the UK. “Arla’s promotional calendar reflects the regional trend, supporting Lurpak within the wholesale sector through national promotions and also regionally to focus on key Northern areas where Lurpak over-performs. Anchor Classic is promoted regionally in the South where strong depot contacts help drive pre-sells to key trade contacts. A combination of national and regional activity ensures our brands’ coverage is maximised.”
One of the key selling periods for Anchor block is the Asian Diwali festival in the autumn, when sales rise by as much as 50%, especially in areas where there are big Asian communities which use Anchor to make ghee. In addition, Anchor block is used to cook chapatis and parathas, particularly during the Ramadan period.
Tate continues: “In the current economic climate, with neither retailers nor consumers wanting to spend more than they have to, case sizes are important. Larger sizes, like 500g BSM packs, are not a great choice for smaller independent stores which tend to have limited shelf and storage space. Arla’s top seller in the wholesale sector is the 12 x 250g Lurpak Spreadable.
“When space is limited, we believe retailers should carry a core range that represents the main sectors and the top selling brands to ensure customer demand is met, and thereby driving category sales. The top selling brands tend to be the best supported in terms of advertising and promotional activity. We invest heavily in TV advertising for both Lurpak and Anchor and we tie our wholesaler promotions in with our ad campaigns to capitalise on awareness and demand.”
This year, Arla Foods is backing Anchor to the tune of £10m. Activity focuses on the brand’s free range positioning and includes TV ads which spoof The Great Escape. There is also a major on-pack promotion during the summer, again with the Great Escape theme. Meanwhile Lurpak is backed by a £12m spend with a campaign that celebrates the pleasure of a leisurely weekend breakfast. Advertising will be on screen for 10 months this year.
Over at Unilever, Phil Ellis, spreads category director, believes this year is an exciting one for the spreads category as the Food Standards Agency recently launched a campaign raising awareness of the health risks of eating too much saturated fat (sat fat). “The government initiative promotes simple, positive steps to reduce sat fat intake and reduce the risk of developing heart disease. One simple way to achieve this is swapping butter for an olive or sunflower oil spread such as Flora.”
He reckons spreads also offer better value as well as being a healthier alternative at a time when consumers are more cautious of their spending. With an increase in the number of consumers eating in the home and a steep rise in the number of lunchboxes going into schools and workplaces, Ellis believes the spreads category is likely to benefit from an increase in frequency of purchase. In addition, the rise in popularity of baking means products such as Stork have seen a significant increase in sales (+23% year-on-year according to IRI data).
Much of Unilever’s Flora brand’s activity has been focused on combating consumer confusion surrounding good and bad fats.
Last summer the brand launched a new campaign where consumers could collect tokens to provide primary schools with free cooking equipment, in a bid to help encourage children to learn more about the importance of a healthy diet.
Flora is now investing £5m in support of the second phase of the Cooking with Schools on-pack promotion.
It’s not just butter or spreads that people put on their bread but also jam, marmalade and increasingly honey.
Premier Foods recently boosted its Hartley’s Best jam range with the addition of three new flavours: rhubarb; mango; and sweet orange.
The company has also developed colour-coded shelf-ready packaging. David Atkinson, category business unit general manager for spreads, at Premier Foods, explains: “The new packaging enables shoppers to locate their favoured product quickly and easily, with the added benefit of brightening up the fixture. The shelf-ready packaging will also enable store staff to identify products more easily when they are restocking the shelves.”
Other recent additions to the range include two Hartley’s honey jams – jams which use honey as a natural sweetener – and similarly two honey marmalades under the Robertson’s Golden Shred brand.
There is obviously a trend here as honey maker Rowse has also introduced a range of fruit and honey conserves sweetened with honey. Rowse Fruit amp; Honey Conserves come in three flavours: strawberry amp; honey; raspberry amp; honey; and blackcurrant amp; honey.
David Bondi, managing director at Rowse, reckons that with the decline of the jam market and the increase in honey sales because of its health benefits, it makes good business sense to combine two of the nation’s favourite sweet spreads.
According to Nielsen, honey sales value overtook marmalade in 2006 and if trends continue, honey could grow from its current £83m a year to £100m and overtake jam within the next two years.