Keep ‘em Satisfied

Americans are a busy, snacking bunch, with many of them relying on grab-and-go items to give them a boost of energy to start the day right and satisfy their cravings throughout the day As a result, the breakfast and snack bar market has posted strong growth in recent years — and should continue to do so.

In its November 2014 “Snack Bars in the US” report, Euromonitor International, Chicago, states that the breakfast and snack bar market grew 5 percent in 2014, reaching $6.9 billion. Moreover, it is expected to increase by a compound annual growth rate of 4 percent at constant 2014 prices to reach $8.3 billion by 2019.

But Michael Halverson, vice president of sales with Schulze & Burch, Chicago, notes that the breakfast and snack bar category, when compared to other categories, is one of the weakest in terms of store brand volume. Retailers, therefore, have a strong opportunity to grow their own-brand selection here.

Go beyond the basics

In this category, there’s always a place for the staples: crunchy granola bars equivalent to Nature Valley bars, Halverson says. But it’ll take more than the staples to develop a strong store brand breakfast and snack bar program.

For instance, increased protein and decreased sugar content continue to be of great consumer interest, says Allison Cienciala, director of business development with Port Coquitlam, British Columbia-based Nutri-Nation Functional Foods.

“An ever-growing group of consumers are becoming educated about healthy dietary choices,” she says. “While many diet concepts are complicated, themes like sugar reduction and protein intake are common amongst multiple diet regimes and easy to seek out on a product label.”

Halverson also sees the demand for increased protein — as well as higher fiber content.

“Fiber,” he says, “has been requested for a number of years now, and there’s been some line extensions within fiber that make a lot of sense for retailers to stock.”

Innovative flavors, too, are critical to grabbing shoppers’ dollars, says Sheryl Willison, vice president of marketing and sales with Taste of Nature Foods, Markham, Ontario.

“Consumers are looking for taste experiences — delivering on that will win consumers over,” she says. “Unexpected flavors are popping up in all sorts of categories.”

Laurent-Xavier Gilbert, vice president of innovation and marketing for Leclerc Group, Saint-Augustin-de-Desmaures, Quebec, agrees about the importance of unique flavors. Additionally, he points to soft-baked breakfast biscuits —regular and mini size — as areas with strong growth potential. These products are similar to those under the Belvita brand, which hit U.S. shelves in 2012.

First introduced in Europe, these items have witnessed “tremendous success” domestically because of their sweet taste and high fiber content, Euromonitor says.

“Consumers perceive the product as an easy and mostly healthy breakfast option that pairs well with their morning cup of coffee,” the report states.

Gilbert also points to nut-based bars as an area of opportunity, as they offer a more healthful alternative to conventional snacks. And some smaller manufacturers have introduced savory snack bars. However, it’s too early to tell whether or not savory bars will take share from traditional salty snack manufacturers.

Speaking of taking share, breakfast bars saw minor declines in 2013 and 2014, likely resulting from the “incredible growth” in energy and nutrition bars, Euromonitor reports. Although both products are seen as viable alternatives to traditional breakfast foods, energy bars are seen as more healthful and useful than breakfast bars, as they generally contain more natural ingredients and can be consumed at any point of the day. Breakfast bars were able to compensate because of their lower price, but as incomes rise, the lower price will have less importance to consumers.

Besides ingredients and flavors, retailers might want to rethink product format when developing store brand breakfast and snack bars. The biggest trend Jonathan Miller, president of Chicago-based Element Bars, sees in the breakfast and snack bars space is a smaller form factor — bite-size pieces and clusters. These products can retail in resealable stand-up pouches, he states.

“We have a couple of people who have been approaching us about a resealable package, and this is novel — not only because the packaging’s novel, but it’s sort of a little bit ahead of the ballgame for when the FDA labeling changes come,” he says. “FDA’s going to be standardizing the number of servings per container.”

Catch their eye

Speaking of packaging, Halverson notes that effective on-pack communication is critical. Retailers need to make sure product attributes are “easily understood in the fraction of a second.”

In terms of information to communicate, many brand owners continue to push the health- and wellness-related aspects of their bars to attract health-minded consumers, highlighting the use of all-natural, organic and non-GMO ingredients in their bars, Euromonitor explains. Brands also are highlighting their products’ fiber and protein content on packaging.

And in terms of graphics and design, Cienciala advises retailers not to be bland and generic.

“Retailers that create engaging packaging stand to benefit from generating consumer interest and building loyalty,” she points out. “An exciting package design suggests that the product itself may have some exciting ‘better than’ attributes that are worth shoppers’ attention.”

Willison recommends that packaging be clean, crisp and minimalist.

“The use of bold color, clean lines, strong photography and unique substrates grabs consumers’ attention and helps to break through the clutter,” she states.

As for merchandising, Halverson advises retailers to group store brand breakfast and snack bars together to make them easy to locate.

“If they’re scattered throughout the set — and if you have a very limited offering — it can be very challenging for the consumers to understand where the value is in the set from a pricing standpoint,” he says.

But don’t limit placement to the bars section. Gilbert recommends that retailers cross-merchandise their breakfast bars, for example, with traditional breakfast offerings to reinforce the consumer’s association of these “newer” items with the concept of on-the-go breakfast. He also recommends selling singleserve items at checkout to grab additional sales through impulse buys.

Do consider offering store brand breakfast biscuits in addition to breakfast bars.

Don’t rely on just the basics — come up with innovative flavors.

Do think about adding bite-size products to your assortment of breakfast and snack bars.

Don’t be confusing with packaging — give shoppers simple, straightforward information about contents.