From shake to bake

Kantha Shelke, Ingredients Editor

Following a volatile period of mergers and acquisitions, the baking industry sets its sites on healthier products and market shares

Contrary to popular belief, the popular low-carbohydrate, high-protein diet has not chased consumers away from the bakery aisles.  In fact, bakery products have weathered both a stormy economy and a deluge of obesity-related press to continue as a staple of the American diet. 

 

Regardless of economic downturns, people need to eat. Newly reminded of the benefits of wholesome foods, many consumers have begun actively seeing whole-grain, organic and non-genetically modified baked products as part of a healthy diet. Meanwhile, a simultaneous -- and counter-intuitive -- resurgence of comfort foods and decadent desserts has driven up bakery sales significantly.  In short, the focus has shifted from low fat and no fat to wholesomeness and decadence.

 

At the same time, increasingly hectic lifestyles are propelling the growth of convenience products in the bakery category, be they value-added, portable or par-baked mixes. ACNielsen's 2003 Consumer Pre*View survey of attitudes and behaviors found that the majority of households are too tired to prepare evening meals. Hence, convenience-oriented bakery products are growing rapidly, as are miniaturized items, often "hand held" for the "on the go" consumer.

 

But "convenience" shouldn't be regarded as a convenient substitute for authenticity in the baking sector. The nation's increasingly diverse population has prompted increased awareness and acceptance of ethnic foods. As a result, more and more consumers demand authentic ethnic bakery products.  More frequent travel and restaurant visits among consumers are likewise fueling demand for authenticity.

 

Our daily bread

 

The U.S. bread sector netted $8.6 billion in 2002, according to Information Resources Inc (IRI).  Less stringent price-cutting, a feature of last decade's marketing culture, actually helped boost bread sales figures above those of the previous two years. Products were repositioned in their categories thanks to new "value-added" features, as well as ethnic twists. Willing to pay more for quality and variety, consumers responded to these products with increased patronage. With almost 100 percent household penetration, however, the bread sector has little room to achieve dramatic growth.  Hence, future growth will most likely rely on similar "value added" features, probably at the expense of more traditional offerings. 

 

While many Americans claim to have adopted healthier eating habits, recent market data suggest otherwise, at least for the sweet baked goods sector. The American appetite for high-calorie, low-nutrient foods has soared, with sweet baked goods (including packaged cakes, snack cakes, cookies, doughnuts, pastries, pies and muffins) netting $13 billion in 2002 alone. During the same period, Americans topped the sugar consumption chart globally with an intake of 152 lbs. per person annually, 15 percent above the world average and 30 lbs. more per person than in1980. Candy, ice cream and even beverage makers have begun encroaching upon the traditional sweet baked goods market with indulgent concoctions loaded with chocolate, caramel, peanut butter and other gooey delights. Absence of any truly exciting new products or technological innovation may compel insatiable consumers to turn to other product categories to fill the resulting void.