Flat sales float category
Sales of hot and cold breakfast cereals have been flat. “Consumers are faced with many breakfast options each day,” said David Browne, senior analyst at Mintel International Group. “While most do eat breakfast, it may mean a cereal/snack bar, yogurt, eggs, toast/bagels, baked goods or fast food restaurant options.” The popularity of egg-based breakfast sandwiches, particularly those available at fast food outlets, has surged. Consumers increasingly are buying breakfast outside the home.
Cereal prices also have been rising or in some cases, have stayed the same while package size has shrunk, according to Browne. “Consumers are looking for value in the sector and are increasingly keenly aware of how much cereal they are getting for the $3 to $5 purchase,” he said.
All leading brands are experiencing flat sales, with Kellogg’s Corn Flakes, Raisin Bran, Special K and Rice Krispies, and General Mills’ Cheerios showing some of the biggest dips between 2007 and 2010.
Those products are most vulnerable to private-label competition. “As leading companies and lesser companies are all flat or in decline, store brands are really the only bright spot in the category,” Browne said. Private label, which collectively accounts for only about 12% of sales overall, according to Mintel, saw sales grow more than 3% last year.
All-natural cold cereal sales also are up. “It’s now a $560 million subsector, led by Kellogg and its Kashi brand,” Browne said. Among brands, General Mills’ Multi-Grain Cheerios and Cinnamon Toast Crunch were two strong players, which have had gains for the past few years.
In a recent Mintel survey, 69% of cereal consumers said whole grain is important in products they chose to eat, and 63% said the same of multigrains. “We may start seeing more of these types of products in the future,” Browne said.
Despite manufacturers reducing the amount of sugar in their products, high-sugar cereal is outperforming low-sugar. Sales of low-sugar products were down 2.9%, while sales of products with 26% or more of the recommended daily intake of 40 g were ahead 1.1%, according to Mintel.
The article above is part of the DSN Category Review Series. For the complete Cereal Buy-In Report, including extensive charts, data and more analysis, click here.
Skinny Nutritional, Cliffstar enter deal
BALA CYNWYD, Pa. — Skinny Nutritional has entered an agreement with Cott’s Cliffstar subsidiary to expand the availability of Skinny Nutritional’s line of Skinny Water zero-calorie enhanced beverages.
Through the partnership, Skinny Water zero-calorie enhanced beverages will be exclusively manufactured and distributed by Cliffstar to selected new and existing customers through its retail channels, providing increased scalability for the Skinny Water brand. This agreement spans beverage production, raw materials procurement, research and development, freight management and retail inventory management.
"We are extremely excited to announce this strategic relationship with Cliffstar," Skinny Nutritional CEO Michael Salaman said. "This agreement allows us to do business with some of the largest retailers in the country and concentrate our resources on marketing and sales. We will be closely working with Cliffstar to introduce and aggressively market Skinny Water throughout the territory. As demand continues to rise, our retail channels are becoming increasingly aware that the concept of ‘skinny’ works everywhere."
Marley Coffee kicks off ‘Taste of Marley Coffee’ social media campaign
LOS ANGELES — Marley Coffee has launched a social media campaign through which the brand will give away 25,000 free samples of Marley Coffee "One Love" organic ground coffee.
The company said its "Taste of Marley Coffee" campaign will offer first-time Facebook fans and new subscribers to MarleyCoffee.com the chance to try out the medium roast coffee, which will be packaged in a sample-sized, 2.5-oz. package. Free samples are available to lawful permanent resident of the 48 contiguous United States or the District of Columbia and be 18 years of age or older.
"We don’t believe people know just how incredibly delicious Marley Coffee tastes, so we look forward to giving 25,000 people across the U.S. a chance to give us a try for the first time," Marley Coffee CEO Brent Toevs said. "Every time we conduct product sampling at retail stores, we see an increase in sales. The ‘Taste of Marley Coffee’ campaign takes the proven in-store sampling concept to a national scale, leveraging our growing social media presence to cost-effectively introduce more consumers to our products. We’re confident this approach will increase awareness and positively impact sales at retail and online as well as through foodservice and office coffee service."