In ABA's Mid-Year Consumer Update, retail thought leader Todd Hale strategized with bakers to take advantage of growth opportunities in the marketplace. He reported that although consumer spending was up, baking category sales were relatively flat. Sales around the perimeter of the storing are faring better, therefore the focus needs to be on attracting customers to center-store bakery aisles.
"Growth is hard to come by, you need to work with your retail partners to find innovative techniques to drive people to the category," Todd said. "Baked goods are the number one reason consumers go to the grocery store. Collaborate with your retailer and other food manufacturers to bring innovation to this category and drive growth." Todd suggested several specific ways to take advantage of opportunities based on today's consumer shopping behavior and trends.
Key takeaways from Todd's presentation:
- Bakery is the number one driver of consumers to retail across all shopping patterns.
- Bakery has a 3x multiplier effect with complementary categories.
- Healthier offerings are an opportunity with consumers who deem "health and wellness" a priority; these types of consumers buy more often and spend more per trip.
- Salty snacks are the number one growth category – diversifying products is an opportunity (i.e., bagel and pita chips).
- Frozen baked goods / Ready-to-eat category is down – returning traffic to these aisles is critical.
- Bakers need to partner with retailers on innovative techniques to promote center store, i.e., display baked goods alongside ancillary food products such as bread toppings and complementary fixings.
- Consumers are looking for value and convenience – opportunity for pre-prepared, bite-size and single-serve offerings.
Todd told bakers to get ahead of the trends, collaborate and innovate. "Drive the wave, don't ride it," he said.
Don't miss Todd Hale this spring for his State of the Consumer Update on consumer trends at the 2015 ABA Convention, March 29 – April 1, Ritz Carlton Orlando – Grande Lakes, Orlando, Fla.