Grains and proteins in a new era of bowls and bars

Cereals are more popular than ever as breakfasts at home during the pandemic increased, and are increasingly becoming “itemised” and turned into single serves for convenience instead of just being dispensed from the box. Meanwhile, cereal bars for some time have been the advance expression of this trend, which was accelerated by the food-to-go phenomenon – now (temporarily) diminished by the lockdown.

But the lockdown has not dampened enthusiasm for cereal bars, or their hybrid in betweeners, pioneered by products such as belVita, from Mondelēz International, which took pouring cereals and fused them into a solid state, adding  a variety of flavours and creating a whole new breakfast category – a biscuit that could be eaten without milk if desired – that segued into the existing cereal and protein bar market and arguably liberated it.

We reported last year that as our lives get busier and traditional mealtimes become more fluid, that the market was seeing an increase in snacking, and that according to IGD a third of consumers of consumers snack more than twice a day. This was a developing trend at the start of 2020 and a fantastic opportunity for cereal bar manufacturers. A reported 85 per cent of consumers were attempting to improve their diets, with more passing on confectionery and crisps when choosing something to snack on, and instead going for a cereal bar – which likely would also boast of the protein it contained.

Of course, we all know what has happened since then. The absence of the traditional daily commuter surge and the desertification of office life and routine due to the pandemic, has had a big effect on the food-to-go market, of which cereal bars were such an integral part. But resilience is seemingly baked-in.

“As people begin to travel a bit more, the demand for on-the-go products is likely to elevate again,” predicts Matt Goddard, Wholesale Trading Director, PepsiCo – makers of Quaker Oats. “We know that on-the-go bars were a popular breakfast choice for under 35’s last year [2019], so we’re confident that we will see demand for these formats pick up, particularly as we expect people to start making trip backs to the office [in 2021].”

Cereals bar none

If life on the move was encouraging cereal manufacturers to diversify into single serve and cereal/protein bars, then the enforced homestay of 2020 and the revival of the more leisurely breakfast made consumers fall in love again with cereals in bowls – but not to the detriment of bars, which did duty as the snacking stomach stand-by for the nation’s homeworkers, minimising the revenue hit on the commuter food-to-go phenomenon.

“What we have seen is that, with many consumers working from home and more time to spend on their breakfast, shoppers are turning to the traditional oats segment, with this growing by +12.2 per cent since lockdown was first enforced,” revealed Goddard.

“The cereal category is worth £77m in the total impulse category, up 15 per cent year on year,” says Darryl Burgess, Head of Sales for Weetabix. “Convenience stores have played an incredibly important part in people’s lives since lockdown and this boost looks likely to continue. Having a well-stocked breakfast category with all of the core and top-selling cereal brands [see box] has never been more important in a changing breakfast occasion as people look to purchase more day-to-day items from their local stores.

He reveals that cereal brands performed really well during lockdown, as people relied on familiar products during a period of uncertainty. For example, Weetabix Original performed well and sales for Weetabix Minis Chocolate also rose an astonishing 44 per cent.

“Consumers have returned to cereal because of its versatility,” says Burgess, “it’s quick and convenient but can also be personalised with additional toppings and different milks, which taps into the trend for personalised breakfasts. That’s why we gave our Any-Which-Way-A-Bix ad campaign a boost for the back to school period in 2020, as part of our £11m marketing investment this year.”

Retailers need to stock a variety of products, focused on a core range of best-sellers, including Weetabix Original, Alpen, Weetabix Minis, Weetos and Ready brek, he says.

Ready brek, particularly, continues to see strong sales. Nielsen total coverage figures show the brand continuing to perform ahead of the ‘Hots’ category, with value growth of +8 per cent and +9 per cent volume summer growth over the twelve weeks to 8 August, according to Nielsen. “We brought Ready brek back to TV in October with its popular ‘Central heating for everyone’ creative, inspired by its iconic ‘glow’ advertising from the 1970s,” enthuses Burgess, as well he might in these chilly winter months.

Porridge, Ready brek and products such as Quakers Oats are obvious big-sellers during the cold period ahead – the Hot Cereals segment is worth approximately £8.7m in the impulse channel – but they are also year-round winners as the health-trend loop-back from cereal bar popularity benefits the oats sector as a whole.

“Health is high on the agenda for many shoppers, which is understandable given the current climate,” agrees Goddard. “Quaker Oats are a must-stock as it caters perfectly to this change of consumer demand, with naturally-occurring health benefits and low sugar content. As a natural raw ingredient, our oats are also perfect for cooking breakfast from scratch, something that we’ve seen shoppers moving towards during lockdown.”

It is something underestimated by people who think of a bowl of porridge as exotic if sugar is sprinkled over it. The oats world is now very different to the past image of ascetic simplicity, as Quaker points out in its “Go Forridge” campaign.

“We wanted to inspire the nation to get imaginative and add ingredients from their cupboards, freezers and fridges to their porridge toppings for new flavour combinations,” says Goddard. “Retailers can make the most of this trend for scratch cooking, stocking a range of cupboard and freezer options that are ideal to show just how versatile and tasty porridge can be.”

Scratch-cooking speaks to value, and value is another string to cereal’s bow – a nutritious fill-up at an economical price-point: a factor that many feel will loom large in 2021 as furlough funding finally peters out.

“We always work closely with retailers to ensure that our product range works for them – this includes different pack sizes and price marked packs,” says Burgess, alert to the fact that 2021 might well be the year of PMPs.

“PMPs are a major growth area for convenience stores, as consumers are increasingly looking for reassurance on value. The Weetabix PMP range covers a range of SKUs across our cereal and drinks portfolio, at a range of price points. We work hard to ensure that our price marked packs offer competitive shared margins.”

Multipacks have also increased in popularity during lockdown, especially for cereal bars and drinks, as people stock up on fewer trips outdoors. “We expect this to continue with more people working from home,” concludes Burgess.

“We’ve re-launched our 1kg Traditional Oats proposition in impulse with a new price marked pack, available for £1.99 RRP,” adds Goddard. The total Quaker PMP range had in fact grown +16.78 per cent over the year by late 2020, with traditional oats PMPs seeing the greatest growth of +26.9 per cent in Independents and Symbols.

“Traditional Oats have grown hugely during the recent pandemic, so its important retailers are able to offer larger pack sizes at great value,” says Goddard. “The new price marked pack is a great way to provide consumers with a better value proposition.”

Quaker Oats aims to inspirea locked-down nation with purpose and positivity this new year, with a multi-channel campaign,“Have 2021 For Breakfast”. Live from January 4, the activity will feature an on-pack promotion, with 1000’s of prizes available to be won, including home experiences, staycations and outdoor activities.

“We recognise that people seek enjoyment from a number of different activities, so we’ll be rolling out four promotional pack designs to showcase the breath of experiences available to be won,” explains Danielle Mendham, Senior Brand Manager at Quaker Oats.“We want to excite and inspire shoppers by showing them that there’s a prize up for grabs that’s just for them, whether that’s a yoga mindfulness class, a luxury glamping getaway, a cookery course, outdoor sports adventure or a garden makeover – to name a few.”

Hot oats are a winner, but Weetabix’s Darryl Burgess reminds us that unheated cereals, especially healthy options such as muesli, are also absolute shelf stand-outs. “Retailers should also stock Alpen, the nation’s number one muesli brand, with the Alpen brand worth over £50m,” he reminds us. “We have a big year ahead for Alpen as it celebrates its 50th birthday, with new campaigns and added investment.”

He adds that, “Breakfast has become more of a social occasion in the past year, with 53 per cent eating more together as a family.Younger people have also returned to the breakfast table, with a 2.8 per cent increase in cereal consumption compared to 2019.

Clearly, both hot and cold cereal is looking good for 2021.

Heading to the bars

Cereal bars are now a well-established segment and continue to grow and enjoy ever more popularity with consumers. They are tasty, temp sit-down meal substitutes, practical mobile snacks, and with the fruit and protein combinations, slot nicely into the healthy-eating sector despite being delicious and indulgent.

Again, just as with cereals, the innovation is never-ending. One of the biggest brands in cereal bars (in fact the UK’s number two) is General Mills’ Nature Valley, with its four flavour SKUs across Protein, Crunchy, Sweet & Nutty and Popcorn. Now, Nature Valley has just announced the launch of new Nature Valley Protein Soft Bakes. The first of their kind to hit UK shelves, Oats & Honey and Blueberry & Almond soft bakes will be available in grocery and convenience from January 2021.

Adrienne Burke, Marketing Manager, Snacking at General Mills, said: “Our new Nature Valley Protein Soft Bakes are the perfect, easy breakfast with an added boost of protein to help shoppers start strong. We know 25 per cent of UK consumers eat cereal bars for morning fuel, and are looking for ways to increase their protein intake in the morning, too. By offering a breakfast biscuit with high protein content that also delivers on taste, we’re meeting this demand head-on.”

The launch of Nature Valley Protein Soft Bakes will be supported with a £1 million investment as part of a 360˚ “Get Out More campaign”. Nature Valley will also be running an activation in March to encourage the nation to switch up their morning by grabbing a Nature Valley Protein Soft Bake and getting outside.

The photogenic and slightly retro-looking Lärabar brand, also now owned by General Mills (after being started in her kitchen by US entrepreneur Lara Merriken and introduced to the UK market two years ago) is fast catching up. Lärabar specifically trades on its delicious protein recipes and currently offers Banana Choc Chip, Apple Cinnamon and Peanut Butter Choc Chip flavours. The protein angle is definitely the coming trend.

General Mills brands including Nature Valley and Lärabar are growing value sales by £6.8m in the last year. As the number-one driver of growth by £4m across the category, the company’s aim is to satisfy the growing consumer demand for on-the-go, convenient snacking – and the current conditions look ripe to fulfil that ambition.

In fact, a sign that the cereal bar category is in for a power-packed year comes from Ferrero, which has just bought Eat Natural, which produces high-quality cereal bars, toasted muesli and granola.

It is interesting that a choc/hazelnut focussed confectioner has seen the potential of bars as they continue to proliferate in form and flavour.

Ferrero says it plans “to maintain and further embed Eat Natural’s strong brand authenticity, while supporting the company with distribution and expansion to new markets and category segment opportunities.”

As part of the acquisition, The Ferrero Group will take over the production facilities in Halstead, UK, and wishes to retain the management and the employees of the businesses.

“Eat Natural are an excellent strategic fit for the Ferrero Group as we continue to expand our overall footprint and product offerings into the healthier snacking market segment,” said Giovanni Ferrero, Executive Chairman of the Ferrero Group. “Eat Natural are a family-orientated company who share a number of the same values as us, and like us care deeply for our consumers, the environment and the communities in which we operate. I very much look forward to welcoming them to the Ferrero Group.”

LapoCiviletti, CEO of the Ferrero Group, said, “We are bringing a much-loved, authentic product portfolio into our business, with a very strong market position in the healthier snacks segment. This will allow us to be present in this relevant market segment, fulfilling the evolving needs and trends of consumers. We very much look forward to working with the Eat Natural team as we build our journey of growth together.”

Quaker, meanwhile, is launching new RRP price-marked pack (PMP) formats of its Porridge to Go range of cereal bars,which contain 100 per cent wholegrain oats and provide the same amount as a bowl (when made with a 27g sachet) of Oat So Simple porridge. The new PMPs began rolling out from 4th January, and the RRP £0.75 PMP additions will be available in two flavours – Golden Syrup, and Strawberry,Raspberry and Cranberry.  “Over the last year, we’ve seen shoppers become even more money-conscious in the impulse channel,” said Danielle Mendham. “With shoppers increasingly looking for products that offer value for money, we saw our total Quaker RRP PMP range grow by almost +17 per cent, so it’s fair to say that we can expect demand to continue into the new year.”

This year will indeed be an interesting phase of food-to-go recovery, healthy but tasty snacking, and aa clearly increased role for cereals as a part of the nation’s diet as it adjusts to a rediscovery of breakfast. Expect oats and bars to shine.