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Modern Convenience

Last September, an Institute of Food Technologists (IFT) article, Today’s Supermarket Special: Transforming the Store, indicated that, while convenience is still a priority for shoppers, the definition has changed.

“Convenience isn’t just about getting in and out of the store quickly or going to the store nearest to you,” says Laurie Demeritt, CEO of The Hartman Group, which partnered with Food Marketing Institute (FMI) on the 2014 grocery shopper trends research. “It’s about going to the store that is going to best meet your needs for an occasion. Convenience to consumers might mean giving me a shortcut to my meal this evening, giving me a sense of discovery.”

A year later, that definition of convenience is the new normal. “Today’s consumer is looking for an experience, not a product,” says Liz Hubbs, sales manager for Western Canada for Dawn Food Products, a manufacturer of in-store bakery ingredients. “Rather than just looking for a product, they’re looking for that overall experience from baking it themselves, or buying an indulgent dessert, or cooking or preparing meals.”

Appealing to those consumers starts with identifying them.

“Keeping an eye on the demographics and psychographics of the shoppers coming into the stores should be an ongoing focus of the retailer to ensure they are continually meeting the needs of their most loyal customers with the right product offering and price points,” says Bryan McCourt, senior director of marketing for Canada Bread.

Increasingly, the demographic to watch is the millennials. They are influencing food culture and changing fresh departments, including bakery.

According to International Dairy Deli Bakery Association (IDDBA) research for Engaging the Evolving Shopper: Serving the New American Appetite, 39 per cent of millennials purchase baked goods at preferred stores and not their primary store, where they buy most food and grocery items.

So how to draw them? Focus on fresh departments.

“We see that a fresh bakery section drives a lot of these millennials,” says Hubbs. “If you have a fresh deli, a fresh bakery, this allows those retailers to differentiate and brand those millennial shoppers to them.”

And what do millennials want? Answers to the question: “What’s for dinner?” “In the commercial bread category, there definitely continues to be a growing importance of the meal solution categories —bagels, tortillas, buns and rolls — with all those categories growing faster than commercial bread over the past year,” says McCourt, adding that growth figures for the meal solutions category in Western Canada for latest 52 weeks is plus three per cent in dollars. This growth highlights another millennial trend. “We still assemble our meals, but we’re outsourcing a lot of the actual cooking,” says Demeritt in the IFT article. “Consumers are looking to retailers to be almost like a sous chef (i.e., slicing, dicing, and marinating). The consumer just wants to take that [prepared product] and put the final touches on it.” Food imagery helps.

“Shoppers are looking for meal inspiration and fresh ideas on how to use bread,” says McCourt. “The use of food imagery in the section drives that appetite appeal.” Considering the millennial tendency to stay in fresh departments, boosting commercial bread sales means integrating those products into fresh bakery.

“The more integrated the commercial bread and in-store bakery sections are can drive an increased number of bread items in the shopping basket,” says McCourt. Another trend within overall experience: flavour fusion.

Trends to Watch

The IDDBA’s What’s in Store 2015: Bakery Trends Forecast says the top drivers for consumer purchases at in-store bakeries are health, indulgence, and portion size. Other in-store bakery trends include:
• Consumers look at product presentation, freshness, taste, and selection.
• Indulgence, health benefits, and single-serve options are top. • Smaller-sized products are driving more frequent purchases than larger, special-occasion products.
• Household size and age are prominent factors. Hispanic shoppers are an important demographic for in-store bakeries, while millennials create sales opportunities due to their quick-trip shopping patterns.
• Consumers are seeking bakery products made with high fibre and whole grains, while avoiding high-fructose corn syrup, trans fats, and hydrogenated fats.
• The demand for gluten-free products is spurring the use of ingredients such as rice flours, corn flour and meal, ancient grains, and tubers and pulses.
• New waves of hybrid products continue to hit the scene, as well as new twists on nostalgic, traditional sweets.

“We see ethnic trends such as a mix of flavours between the Asian and the Latino, Indian with North American,” says Hubbs. “Definitely a lot of influence from an ethnic perspective on flavour fusion.”

To meet that trend, Hubbs suggests incorporating flavours like coconut filling that matches the Asian influence or mango filling that touches on the Indian and Latino flavours.

Variety fosters that sense of discovery, for example, in buns and rolls, which McCourt says are leading growth at plus seven per cent.

“There’s a lot of innovation coming out in terms of taste and more artisan type products, like rustic buns or unique flavours,” he says. Alternatives are important.

“Overall, the focus for the commercial bakery should be breadth of offering. The offerings should span product segments — white, wheat, grain breads, Italian breads, hot dog and hamburger buns, bagels and breakfast breads, and flatbreads — and within each segment, offer a range of price points to maximize reach and sales potential,” says McCourt.

Fresh Ideas
Shoppers want meal inspiration, says Bryan McCourt. “Having bread displayed outside of the section and linked directly with a meal occasion also helps to give shoppers meal inspiration and drive purchase.” Bagels in the dairy aisle to pair with cream cheese or homemade egg sandwiches. Tortillas in the Mexican aisle as shoppers plan fajita night. Condiments and buns next to the meat bunkers for summer barbecues.

While artisanal products are increasing, statistics reveal changes within other categories. Traditional sliced bread has been flat in overall dollar growth, says McCourt, but within the category, white bread has seen a resurgence over the past year, growing at plus three per cent, which he attributes to the reduction in media around gluten-free diets and “carbs are bad” thinking.

Regarding gluten-free, in a June 2015 report on bakery products in Canada, Joel Gregoire, senior food and drink analyst at Mintel says, “Gluten-free has garnered a great deal of attention, but when asked, consumers rate it as being a low priority behind all other considerations, suggesting manufacturers should look to other attributes when deciding on innovation and crafting strategic messaging. ”

At the same time, gluten-free remains a strong trend, tied to overall health alternatives trends. McCourt sees this reflected in figures for grains, which have grown by plus one per cent, and diet bread by plus eight per cent.

Consumers are looking for what makes retailers different — your bakery is your opportunity to make your store unique.

Size Matters
Indulgence, meal occasion/solution, snacking, health – these trends focus on individual experience versus stocking up. And one thing all these trends share is portion size — and this is especially true of bakery treats. “Based on our data and our market research, we see that the millennials and a lot of consumers are switching towards individual desserts or smaller sizes,” says Liz Hubbs.

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