Food-to-go is a phenomenal opportunity for wholesalers and their customers, and breakfast is one of the categories where they can reap the biggest rewards.
“Food-to-go is the third most valuable shopping mission for the UK convenience sector,” says Katie Littler, communications director at retail consultancy Him!. “It drives 890m shopping visits a year. But there remains one significant part of the market that UK convenience is still struggling to capture – breakfast-to-go, which accounts for just 1% of all visits to c-stores.”
The meal occasion itself is changing, too. Natasha Quinn, foodservice channel operations manager for Ferrero, says: “The breakfast market has really evolved. Many of us are choosing to have it on-the-go, or make it an occasion by having brunch and skipping lunch. We are also spending more than ever before, with analyst NPD Crest reporting the average breakfast bill has increased by 31% compared to eight years ago.
Wholesalers, therefore, need to roll up their sleeves and help their retail and foodservice customers improve their offer.
Biscuits breaking the market
The launch of the breakfast biscuit from belVita revolutionised the breakfast on-the-go market in 2010. Made with cereals, milk and vitamins, the handy biscuits were a hit with time-strapped shoppers, and the category continues to thrive.
“The healthier biscuits category is worth £485m in the UK and is continuing to perform well,” says Susan Nash, trade communications director at Mondelez. The brand has responded with the recent launch of new Soft Bakes Choc Chip in both pricemarked pack (PMP) and non-PMP varieties.
Convenience is of the essence with breakfast on-the-go, and the introduction of handy pots and sachets means porridge is another product performing well. While oats already pack a strong nutritional punch, PepsiCo has taken it to the next level with the launch of Super Goodness and Super Fruits variants of Quaker Oats that contain protein, fibre, omega-3, vitamins and minerals, to give busy consumers a mega-health kick.
“Taste, health and convenience continue to be important drivers at breakfast time,” says Duncan McKay, senior marketing manager at PepsiCo’s Grains UK. “But consumers are also increasingly seeking a wholesome breakfast made with nutritious ingredients.”
More recently, the porridge brand launched gluten-free options, available in a 510g canister, and a 350g box of 10 Oat So Simple sachets.
Chris Beckley, managing director at Kff, pinpoints the challenge in wholesalers ensuring they get the variety of products needed to cater for the ‘handheld’ opportunities of breakfast.
“Whether it is small portions of porridge, cereals that can be eaten on the move, granola slices or fruit flapjacks, it is vital to have an option for those in a rush. Handheld snacks at breakfast is a huge trend and customers demand a stand-out range of choices, which presents real opportunities for the operator.”
Kff has a range of Perkier Coconut and Chia Seed Quinoa bars, which Beckley says tick the box; the bars are also free from gluten, wheat and dairy, as well as 100% vegan, thereby catering for a host of other trends in the market.
Samantha Winsor, assistant brand manager at Lantmännen Unibake UK, says: “Today, we are seeing large food chains offering convenient, on-the-go breakfast options, with one in six breakfast on-the-go purchases being made while on a work-based journey. Wholesalers and their customers can capitalise on this by stocking hand-holdable bakery products for consumers looking for a quick breakfast to enjoy either en route to work or at their desks.”
Lantmännen’s advice to wholesalers is that they can improve breakfast sales using strong PoS material, and by communicating consumption ideas such as ‘great with coffee’, ‘a breakfast treat’, ‘this week’s special’ or ‘freshly baked’.
Drinks flood the aisles
And it is not just food-to-go that is popular in the morning – breakfast drinks are also taking a significant gulp of the category.
“Dairy products such as yoghurt drinks, protein drinks and milkshakes are all doing well, but it is breakfast meal drinks that are the stellar performers – up 58.9% by volume year-on-year,” says James Logan, commercial director of juice giant Refresco, which owns the Del Monte, Sunny D and Cranberry Spray brands.
“We are no longer a three meals a day nation,” says James McMaster, CEO of Life Health Foods UK, which has launched breakfast drink Up&Go. “There are now eight daily food occasions – five of which occur before lunchtime.”
He adds that there is a “massive” opportunity for wholesalers to encourage customers to make the most of morning trading opportunities, particularly those customers based in or near train stations and airports, and therefore perfectly positioned to cater for hungry commuters.
Up&Go has recently been given a new-look pack design, supported by a major marketing push, as part of its mission to grow the breakfast drink category.
“The breakfast drink category is growing fast at 60% year-on-year, but it is still small and crying out for a specialist brand that resonates with people who believe there are better things to do than sit down for breakfast, whilst investing in the educational marketing the category needs to reach its full potential,” McMaster says.
“Up&Go hits the core consumer sweet spot, with a unique active adventure lifestyle proposition and breakfast-led nutritionals, containing oats, as well as more protein than two eggs, more fibre than two pieces of toast and more calcium than a pot of yoghurt.”
FUEL10K, meanwhile, has a full range of protein-boosted breakfast options, including breakfast drinks and pouches. Co-founder Barney Mauleverer says the brand’s products are “bringing younger shoppers back to the category and helping to drive incremental sales”.
The latest addition to its breakfast line-up is FUEL10K Quark with Fruit – a yoghurt-style pouch that is low in fat and high in protein, with no added refined sugar. Launched into Bestway Batley this month, the pouches do not need refrigerating and have a long shelf life.
FUEL10K may seem like a sports nutrition brand, but it is aimed at a “more modern” and “younger than average” cereal shopper.
“These shoppers are the main offenders of skipping breakfast,” Mauleverer says. “In appealing to them, the brand is growing the category through incremental sales.”
He says that younger shoppers also spend 38% more in the category, compared to the average shopper, “which is why FUEL10K presents such a valuable opportunity for wholesalers and their retailers”.
He concludes: “We are finding that the high-profile media focus on reducing excessive sugar is pushing younger consumers to be more discerning when looking for fast and nutritious mealtime solutions – one thing they are looking for, more and more, is protein with fewer calories, less sugar and less fat.
“There is always a role for traditional products, but consumer habits are changing and wholesalers need to keep up with the times and au fait with the latest trends. It is important to be bold and try new things. Also, be prepared to give new products the time to get noticed – it may not be picked up until the fourth visit.”
Toast isn’t toast
Despite the contenders to the throne, traditional favourites such as toast and the cooked breakfast still warrant their fair share of wholesalers’ shelf space.
Zoe Taphouse, category director at Allied Bakeries, says: “The bakery category is growing significantly in convenience. It is worth £311m annually to impulse retailers and it is performing better than the total market. As 84% of breakfast occasions are at home, and consumers are increasingly looking for choices that fill them up and fuel them for the day, bakery represents a huge opportunity for retailers to increase sales around the breakfast occasion.”
Ferrero’s Quinn says: “Our research shows that although a cooked breakfast is the nation’s favourite (29%), other morning goods only fall slightly behind, with 21% of people choosing to start their day with toast.
“Today’s consumers are looking for value, but wholesalers should not confuse this with poor quality breakfast items. The reassurance of big brands can really give offerings a boost, as well as driving menu appeal and profitability. As the nation’s favourite spread brand, introducing Nutella to menus is the easy way for both wholesalers and their customers to increase profits – especially given that 73% of 26-to-35-year-olds expect to see Nutella on menus, and, most significantly, 81% will actually pay more for it.”
According to recent research from Bookatable, breakfast and brunch bookings are up by 24% and 72% respectively year-on-year on 2014. Thus, wholesalers need to get on board with this trend, pronto.
Lantmännen’s Winsor says: “The breakfast category has been affected by the growth of the brunch trend, which has been largely fuelled by millennials: 18-to-24-year-olds make up 14% of brunch visits and 10% of breakfast visits.
“Wholesalers should therefore suggest that outlets target millennials for the brunch period to boost trade.”
There are a number of on-trend brunch options also worthy of wholesalers’ consideration. Kff has tried to tap into some of them with the launch of eight new breakfast recipes. These include avocado with a lime dressing, a pinch of dried chilli and poached eggs on sourdough toast, with the option to add smoked salmon or streaky bacon, and another vegetarian offering: poached eggs with tomatoes, houmous, mushrooms, guacamole, sweet chilli sauce and basil on toast.
The free-from market has for some time been experiencing exceptional growth and it is predicted to increase by a further 43% by 2020.
Mohammed Essa, commercial director at Aviko, says: “Special diets provide another opportunity – 80% of people think there are not enough gluten-free cooked breakfast choices, while 54% believe vegetarian options are lacking – so there is an opportunity available for wholesalers to support caterers in meeting this demand.
“Our Hash Browns and Hash Brown Bites are not only suitable for vegetarians, they are also gluten-free, helping wholesalers and their customers tap into the growing market, while giving peace of mind that they appeal to coeliac suffers and non-sufferers alike.”
Amy Fisher, senior shopper marketing manager at Dairy Crest, recommends that wholesalers look at Vitalite: “Valued at £4.5m and the number one dairy-free spread in total grocery, Vitalite is a shining light in a challenging spreads marketplace, where dairy-free spreads, currently worth £13.2m, is the only growth area,” she says.
“The wholesale availability of Princes’ fruit and mackerel is key for retailers looking to tap into consumers’ increasing appetite for healthier breakfasts – almost six out of 10 households buy canned fruit and one in five buy mackerel.”
Meanwhile, Graham Breed, marketing director at Princes, urges wholesalers not to forget about the opportunities canned products open up: “99% of the UK population buy canned goods; canned food customers are extremely valuable to convenience retailers, as they are likely to have a higher overall basket spend.
Bit on the side
Getting on top with the right drinks products to stock for the breakfast occasion is another key consideration for wholesalers.
Health and wellbeing is playing a more significant role than ever on this front.
Kff’s Beckley says: “Customers are far more health-conscious than ever before and are looking for breakfast options that are not loaded with sugar, but provide a source of fibre and protein to keep them going. They are also looking to kickstart their day with one of their five a day. The knock-on effect of this for wholesalers who do not meet this demand is that they could easily see themselves left behind, whilst also experiencing a decline in sales.
“However, it is easy for wholesalers to accommodate a shift towards healthier options by simply offering a selection of more balanced alternatives, alongside the more traditional morning offerings. Our Love Smoothies range offers a healthier alternative to many traditional breakfast items, whilst also being easily portable. A huge variety of flavours are available, everything from strawberry to passionfruit to mixed berries. We refresh our offer regularly to reflect the changing seasons.”
Helen Boulter, channel controller at Taylors of Harrogate, emphasises the importance of premium when it comes to coffee. She says: “Roast and ground coffee are becoming increasingly popular. Taylors of Harrogate has a range of delicious roast and ground coffees for this market including the bestselling Rich Italian blend, Lazy Sunday and Decaffé.”
FUEL10K’s Mauleverer sums up the situation in a nutshell and provides a plan of action for wholesalers trading in this category this year. He says: “Many wholesalers are missing out. They need to cater for the younger shoppers who are looking for a fast and easy breakfast solution that tastes good, ticks the healthy box and is good value.”