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Breakfast Food
Making Sense of the Cereal Aisle SALES DRIVERS E VOLVE TO INCLUDE A MIX OF HE ALTH, TASTE, INDULGENCE AND SENTIMENTALIT Y. By Barbara Sax hile the cereal category continues to face increased competition from other breakfast options, new products, particularly better-for-you items, are expected to provide upside for the mature category in 2022. “Consumers are eating cereal more than pre-pandemic, but not as much as 2020,” says Sally Lyons Wyatt, EVP and practice leader, client insights atChicago-based IRI. According to Wyatt, while growth of other breakfast categories, such as frozen breakfast food, refrigerated breakfast entrées, bagels and pastry/doughnuts, are outpacing the growth of cereal, the cost effectiveness of the cereal category could fuel growth during an economically challenged year. To provide true category growth, “cereal manufacturers and retailers will need to leverage digital and social media to discuss the positive points about their products, including fun and exciting experiences,” says
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Wyatt. They will also “need to continue to innovate, renovate and move quickly to capitalize on trends and opportunities that meet consumers’ ever-evolving wants and needs,” says Tom Dixon, chief growth officer at Lakeville, Minn.-based Post Consumer Brands. Experts believe that the more healthful side of the category will be a primary driver going forward. “The hot cereal segment experienced stronger yearover-year percent growth in dollar sales in 2021 than the cold cereal segment,” says Kaitlin Kamp, U.S. food and drink reports analyst at Chicago-based market research firm Mintel. “As consumers emerge from the pandemic, health will be on their minds, and products with health improvements will stand out.” Kamp adds that healthful innovation is more likely to spark trial. Mintel’s research shows that consumers are more motivated to try a new cereal with claims of reduced sugar, added protein or added fiber than by products boasting indulgent mix-ins, co-branded flavors or limited-time flavors. A number of new launches focus on nutrient-dense ingredients and less sugar, including Clif’s recently launched ready-to-eat cereal and Kashi’s new Simply Raisin product launch, the first in the brand’s portfolio to exclude added sugars. Purely Elizabeth is including 7 grams of plant protein in its 5 Grain & Seed oatmeal products, and Good to Go, maker of keto-friendly snack bars, recently introduced vegan Grain-Free Granola, which is low in net carbs and sugar. “We’re seeing demand from consumers wanting functional benefits beyond just good taste,” says Alexandria Mottley,
Key Takeaways Consumers want better-for-you options that are still yummy — think functional indulgence. Grocers can capitalize on flavor and collabation opportunities by showcasing product mashups. Positioning smaller packs as snacks will help offset migration to other breakfast options.
