Fresh-baked approaches

Due to the troubled economy, price has become shoppers’ number one concern when buying bread. Over half (52%) of respondents to Mintel’s survey name “price” as one of the most important qualities they look for when buying bread. (“Made with whole grains” was the second most common response with 40%.)

The economy has changed how people shop. Consumers are shopping more at supercenters and warehouse clubs, clipping coupons, buying more private-label products and seeking out sale items. Roughly a third of bread users surveyed by Mintel say that because of the economy, they’ve started buying bread when it’s on sale.

Scope and Themes

What you need to know

Definition

Data sources and methodology

Sales data

Consumer survey data

Advertising clips

Abbreviations and terms

Abbreviations

Terms

Executive Summary

Bread market reached $20.5 billion in 2008

All segments of the market grew during 2006-08

Market consolidation continues

Private-label thrives amid troubled economy

Wholegrain, high fiber, natural are hottest trends

Bread usage frequency is increasing

Consumer attitudes and motivations

Market Size and Forecast

Key points

“Eating in” and wholegrain trends give bread sales a boost

Bread prices continue to rise

Figure 1: Total U.S. retail sales of bread, at current prices, 2003-13

Figure 2: Total U.S. retail sales of bread, at inflation-adjusted prices, 2003-13

Walmart sales

Competitive Context

Decline in restaurant meals leads to rise in bread sales

Figure 3: Impact of the economy on restaurant spending, by age, February 2009

Private-label becomes a force to be reckoned with

Grupo Bimbo acquires powerhouse brands from George Weston

Segment Performance

Key points

Eating-in trend and whole grains movement drive sales in all segments

Figure 4: FDMx sales of bread, segmented by type, 2006 and 2008

Segment Performance—Fresh Loaf Bread

Key points

Sales gains in FDMx being driven by higher prices

Figure 5: U.S. FDMx volume sales and average price of fresh loaf bread, 2005-08

Sales and forecast

Figure 6: FDMx sales of fresh loaf bread, at current prices, 2003-13

Figure 7: FDMx sales of fresh loaf bread, at inflation-adjusted prices, 2003-13

Segment Performance—Fresh Rolls, Buns and Croissants

Key points

Volume sales dip, but prices rise in 2008

Figure 8: U.S. FDMx volume sales and average price of fresh rolls/buns/croissants, 2005-08

Sales and forecast

Figure 9: FDMx sales of fresh rolls/buns/croissants, at current prices, 2003-13

Figure 10: FDMx sales of fresh rolls/buns/croissants, at inflation-adjusted prices, 2003-13

Segment Performance—Tortillas and Taco Shells

Key points

Health-focused products and popularity of Mexican cuisine drive growth

Diet trends have lesser impact compared to other types of bread

Sales and forecast

Figure 11: FDMx sales of tortillas, at current prices, 2003-13

Figure 12: FDMx sales of tortillas, at inflation-adjusted prices, 2003-13

Segment Performance—Bagels and English Muffins

Key points

Long recovery from low-carb diet craze continues

Figure 13: U.S. FDMx volume sales and average price of bagels and English muffins, 2005-08

Sales and forecast

Figure 14: FDMx sales of bagels/bialys/English muffins, at current prices, 2003-13

Figure 15: FDMx sales of bagels/bialys/English muffins, at inflation-adjusted prices, 2003-13

Segment Performance—Frozen and Refrigerated Breads

Key points

Poor economy a boon for sales in 2008

Figure 16: U.S. FDMx volume sales and average price of frozen and refrigerated bread products, 2005-08

Sales and forecast

Figure 17: FDMx sales of refrigerated/frozen bread, at current prices, 2003-13

Figure 18: FDMx sales of refrigerated/frozen bread, at inflation-adjusted prices, 2003-13

Retail Channels

Key points

Supermarkets lead in bread sales

Figure 19: Retail channels consumers have bought bread from in the last two weeks, March 2009

Figure 20: U.S. retail sales of bread, by retail channel, 2006 and 2008

Retail Channels—Supermarkets

Key points

Supermarkets promoting private-label and discounting prices, but continue to lose share to supercenters

Figure 21: U.S. retail sales of bread at supermarkets/food stores, 2003-08

Retail Channels—Natural Foods Supermarkets

Key points

Growing interest in whole grains, natural products drives sales

But the stigma of high prices and other factors hamper the channel’s growth

Figure 22: Natural product supermarket retail sales of bread, at current prices, 2007-09

Market Drivers

Bread an affordable staple amid troubled economy

Food prices will continue to rise in 2009

Figure 23: Average retail price white and wholewheat bread, 2004-09

Consumers are bargain hunting as indicated in this year’s custom survey

Healthy eating trend drives sales of wholegrain, natural breads

Leading Companies

Key points

George Weston Bakeries sells off U.S. bakery division

Sara Lee

Flowers Foods’ sales keep blooming

Bimbo Bakeries USA

Interstate Bakeries Corp. emerges from bankruptcy

Campbell Soup Company

Manufacturer sales

Figure 24: FDMx sales of leading bread companies, 2008 and 2009

Brand Share—Fresh Loaf Bread

Healthy innovation drives brand sales

Poor economy fuels private-label growth

Manufacturer and brand sales

Figure 25: FDMx brand sales of frozen fresh loaf bread in the U.S., 2008 and 2009

Brand Share—Fresh Rolls, Buns and Croissants

Key points

Arnold Select leads growth, gains market share

Sara Lee and Flowers Foods far under-pace GWB

Manufacturer and brand sales

Figure 26: FDMx brand sales of fresh rolls, buns and croissants in the U.S., 2008 and 2009

Brand Share—Tortillas and Taco Shells

Key points

Mission leads market in innovation and sales

Manufacturer and brand sales

Figure 27: FDMx brand sales of tortillas and taco shells in the U.S., 2008 and 2009

Brand Share—Bagels and English Muffins

Key points

Thomas’ leads the segment and continues to grow

Figure 28: FDMx brand sales of bagels and English muffins in the U.S., 2008 and 2009

Brand Share—Frozen and Refrigerated Breads

Key points

Private-label, small brands steal share from brand leaders

Manufacturer and brand sales

Figure 29: FDMx brand sales of frozen and refrigerated bread in the U.S., 2008 and 2009

Brand Qualities

Pillsbury offers comfort during troubled times

Healthy Life aims to be a dieter’s best friend

Innovations and Innovators

Key points

Following a surge in 2008, pace of innovation slows in 2009

Figure 30: Top ten product claims for new bread products in the U.S, 2007-09

Private-label brands among top innovators

Figure 31: Top ten companies ranked, by number of new bread products, 2007-April 2009

What consumers want: whole grains, high fiber, and no HFCS

Natural and organic is growing

Artisan bread is getting hot

Functional bread works for you

Advertising and Promotion

Overview

Arnold makes eating right easier

Figure 32: Arnold bread television ad, 2008

Healthy Life targets dieters

Figure 33: Healthy Life bread television ad, 2008

Nature’s Pride offers the purest ingredients

Figure 34: Nature’s Pride bread television ad, 2009

Pillsbury aims to make every meal a special occasion

Figure 35: Pillsbury Grands Biscuits television ad, 2009

Thomas’ muffins are so good, it’s a crime

Figure 36: Thomas’ hearty grains English muffins television ad, 2008

Grain Foods Foundation promo shows bread is beautiful

Tortillas on a Mission

Bread Usage

Key points

Household consumption of bread

Figure 37: Household usage of bread products, by product type, 2005-08

Varieties of bread used in household

Figure 38: Types of bread used in household, 2005-08

Volume of bread usage

Figure 39: Number of loaves consumed by household in last week, by household income, July 2007-September 2008

Brand preferences

Figure 40: Brands of bread used in household, by household income, July 2007-September 2008

Impact of Ingredients, Product Qualities and the Economy on Bread Purchase

Key points

Purchase of bread with health claims

Figure 41: Bread purchased with specific ingredients or marketing claims, by age, March 2009

Most important qualities when purchasing bread

Figure 42: Qualities looked for when purchasing bread, by gender, March 2009

Figure 43: Qualities looked for when purchasing bread, by age, March 2009

Attitudes towards Bread, Brand Loyalty and the Effect of the Recession

Key points

Attitudes toward bread

Figure 44: Opinions about various kinds of bread, by age, March 2009

Brand loyalty

Figure 45: Loyalty to brands, and the effect of price when purchasing bread, by age, March 2009

Impact of the economy on bread purchasing

Figure 46: Impact of current economic situation on bread purchasing, by age, March 2009

Impact of Race and Hispanic Origin

Key points

Household consumption of bread types follows stereotypes

Figure 47: Household usage of bread products, by product type, by race/Hispanic origin, July 2007-September 2008

Varieties of bread used in household

Figure 48: Types of bread used in households, by race/Hispanic origin, July 2007-September 2008

Attitudes toward bread

Figure 49: Opinions about various kinds of bread, by race/Hispanic origin, March 2009

Purchase locations

Figure 50: Retail channels consumers have bought bread from in the last two weeks, by race/Hispanic origin, March 2009

Brand loyalty

Figure 51: Loyalty to brands, and the effect of price when purchasing bread, by race/Hispanic origin, March 2009

Impact of the economy on bread purchasing

Figure 52: Impact of current economic situation on bread purchasing, by race/Hispanic origin, March 2009

APPENDIX: SIMMONS COHORTS

Figure 53: Married couples cohorts

Figure 54: Single women cohorts

Figure 55: Single men cohorts

APPENDIX: PRODUCER PRICE INDEX FOR WHEAT

Figure 56: Producer price index for wheat, 2003-08

APPENDIX: OTHER USEFUL CONSUMER TABLES

Bread usage

Figure 57: Types of bread bought in the last month, by gender, March 2009

Figure 58: Types of bread bought in the last month, by age, March 2009

Figure 59: Types of bread bought in the last month, by number of children in household, March 2009

Figure 60: Types of bread bought in the last month, by region, March 2009

Impact of ingredients, product qualities, and the economy on bread purchase

Figure 61: Bread purchased with specific ingredients or marketing claims, by gender, March 2009

Figure 62: Bread purchased with specific ingredients or marketing claims, by household income, March 2009

Figure 63: Bread purchased with specific ingredients or marketing claims, by education level, March 2009

Figure 64: Economic effects on bread purchasing, by household income, March 2009

Figure 65: Qualities looked for when purchasing bread, by household income, March 2009

Figure 66: Qualities looked for when purchasing bread, by number of children in household, March 2009

Figure 67: Qualities looked for when purchasing bread, by education level, March 2009

Changes in bread purchasing and eating habits

Figure 68: Bread purchasing habits, by gender, March 2009

Figure 69: Changes in bread purchases since last year, by gender, March 2009

Figure 70: Changes in bread purchases since last year, by age, March 2009

Figure 71: Changes in bread purchases since last year, by household income, March 2009

Attitudes towards bread, brand loyalty and the effect of the recession

Figure 72: Opinions about kinds of bread, by gender, March 2009

Figure 73: Opinions about kinds of bread, by household income, March 2009

Figure 74: Opinions about kinds of bread, by education level, March 2009

Figure 75: Tendencies when purchasing bread, by gender, March 2009

Figure 76: Types of bread used in households, by household income, July 2007-September 2008

Figure 77: Types of bread used in households, by presence of children, July 2007-September 2008

Figure 78: Types of bread used in households, by region, July 2007-September 2008

APPENDIX: TRADE ASSOCIATIONS