IN-STORE BAKERY EXPERIENCE - CANADA, NOVEMBER 2018 - Mintel
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IN-STORE BAKERY EXPERIENCE - CANADA - NOVEMBER 2018 2 OVERVIEW What you need to know Other areas where baked goods are purchased at retail Canada’s grocery retail landscape is changing. While much of the • Bread from a supermarket aisle (eg Wonder Bread) chatter revolves around online shopping, the fact remains that most grocery “trips” happen on site. That said, the evolving divide • Dessert mix from a supermarket aisle (eg brownie mix, cake mix) between online and bricks and mortar means that to maintain an advantage, retailers are increasingly pressured to offer experiences • Boxed pastry from supermarket aisle (eg toaster pastries, Pop- that are relevant. In-store bakeries are a part of this equation. While Tarts) freshness is of core value for in-store bakeries, it’s not the only point of differentiation. Aside from assortment, retailers can look to • Boxed sweet baked goods from supermarket aisle (eg cookies, model their bakeries to meet the variety of demands that today’s brownies) consumers have. This extends beyond indulgent desserts, but also to snacks that can prove healthier for earlier parts of the day when • Frozen pie or cake from supermarket freezer case (eg McCain consumers are more likely to consider factors related to health, Deep n’ Delicious, Sara Lee) energy and portability. In-store bakeries that work in concert with other in-store departments executing as part of a broader strategy Retail Sales: to provide contemporary day-to-day meal and snack solutions stand to be more relevant. • Bread and bread products: this market covers packaged white and non-white bread, savoury specialty breads and savoury Definition pastries & pies. Market size comprises sales through all retail channels including direct to consumer. This market covers For the purposes of this Report, Mintel has used the following packaged white and non-white bread, specialty breads and definitions for in-store bakeries and for where baked goods are savoury pastries & pies. Market size comprises sales through purchased more broadly. Bakery items purchased from foodservice all retail channels including direct to consumer. It includes sales (eg restaurants) are not included when looking at in-store bakeries through in-store bakeries unless stated otherwise. on the whole. • Sweet bakery: this market covers wrapped ambient and chilled Consumer data: cakes, pies, tarts and other sweet bakery products. It excludes frozen products. Market size comprises sales through all retail In-store bakery channels including direct to consumer. • Bread from an in-store bakery (eg bakery in a grocery store) • Sweet baked goods from an in-store bakery (eg bakery in a grocery store) Stand-alone bakery shop • Bread from a stand-alone bakery shop • Sweet baked goods from a stand-alone bakery shop PREVIOUS © Mintel Group Ltd. All rights reserved. NEXT
IN-STORE BAKERY EXPERIENCE - CANADA - NOVEMBER 2018 3 REPORT CONTENT OVERVIEW What you need to know Definition EXECUTIVE SUMMARY The issues Stand-alone bakeries represent an area of competition Figure 1: Opinions on in-store vs stand-alone bakery, August 2018 Longer-term stagnation in baked good sales Figure 2: Retail market volume consumption per capita of bread and bread products and sweet bakery, 2013-2017 Younger consumers are less likely to make purchases from in-store bakeries Figure 3: Purchase at in-store bakeries, by age, August 2018 The opportunities Fresh-focus is at heart of in-store bakery’s appeal Figure 4: Important factors when choosing a product from an in-store bakery, August 2018 Cross-daypart opportunities helps drive more frequent product usage Figure 5: Correspondence Analysis – Snacking occasions, July 2016 New flavours and less-familiar formats represent an opportunity to differentiate Figure 6: Interest in flavour and format innovation from in-store bakeries, August 2018 What it means THE MARKET WHAT YOU NEED TO KNOW Bread and sweet bakery sales are soft Canadians strive to eat healthy most of the time Immigration fuelling Canada’s population growth MARKET SIZE AND FORECAST Bread sales to remain relatively flat Figure 7: Canada retail value sales and fan chart forecast of bread & bread products, at current prices, 2012-23 Figure 8: Canada retail value sales forecast of bread & bread products, at current prices, 2012-23 Modest growth forecast for sweet bakery Figure 9: Canada retail value sales and fan chart forecast of sweet bakery, at current prices, 2012-23 Figure 10: Canada retail value sales and fan chart forecast of sweet bakery, at current prices, 2012-23 MARKET FACTORS Canadians are more time-pressed Most Canadians live in urban areas Figure 11: Share of Canadians that live in urban and rural areas, 1851-2016 Mobile technology enabling unprecedented opportunity to interact Figure 12: Mobile and smartphone penetration, by age group, May 2017 Immigration fuelling Canada’s population growth Figure 13: Top 10 countries of birth of recent immigrants, 2011-16 Canada’s population is aging Figure 14: Population aged 65 years and over in Canada, historical and projected (% of total), 1971-2061 Canadians strive to eat healthy most of the time… Figure 15: Healthy eating, November 2016 ...but flexibility may be contributing to the high obesity rates Figure 16: Body mass index, self-reported rate of being overweight or obese among Canadian adults, by gender, 2010-14 PREVIOUS © Mintel Group Ltd. All rights reserved. NEXT
IN-STORE BAKERY EXPERIENCE - CANADA - NOVEMBER 2018 4 KEY PLAYERS WHAT YOU NEED TO KNOW Carb-consciousness diets represent a potential challenge to growth Snackable baked goods are an opportunity Baked goods for specific diet to become more prominent WHAT’S WORKING? Demand for better experiences a potential growth-booster CHALLENGES Carb-consciousness diets represent a potential challenge to growth Figure 17: Mojo Me Chocolate Brownies (South Africa), July 2018 Figure 18: Julian Bakery Pegan Ginger Snack Cookie Protein Bar (US), March 2017 Figure 19: Julian Bakery Paleo Wraps (US), August 2018 Figure 20: Growfit Ultra Low Carb Flower (India), June 2018 WHAT’S NEXT? Snackable baked goods are an opportunity Figure 21: Correspondence analysis – snacking occasions - July 2016 Baked goods for specific diet to become more prominent Figure 22: Strawberries & Cream Artisan Raw Cake (UK), July 2018 Figure 23: Lazy Day Foods Free From Tiffin Bites (UK), March 2018 Figure 24: Vega Divas Baked Goods & Desserts Banana Chocolate Cupcakes-to-Go (USA), January 2018 Figure 25: Vegan Cocoa & Goji Berry Muffins (South Africa), July 2018 Figure 26: Probios Go Vegan! Organic Vegan Wheat Croissant with Chocolate Cream (UK), March 2018 Figure 27: The Free From Bakehouse Bakery Banana &Date Flapjack (UK), July 2018 Figure 28: Ozery Bakery Organic Morning Rounds Cranberry Orange Flavoured Toastable Fruit and Grain Buns (UK), November 2017 THE CONSUMER WHAT YOU NEED TO KNOW In-store bakery’s importance reflect Canada’s retail evolution Demand for freshness reflects core appeal of in-store bakery Opportunity to bring theatre to the bakery Looking abroad can be an inspiration for innovation at home Foodservice focus can help focus innovation for growth IN-STORE BAKERY USAGE In-store bakery’s importance reflect Canada’s retail evolution Figure 29: Locations where baked are purchased, August 2018 Over half of consumers made a recent in-store bakery purchase Figure 30: When and where baked goods are purchased, August 2018 Young women key to growing bread at in-store bakery Figure 31: When bread from an in-store bakery was purchased, women 18-34 vs overall, August 2018 Foodservice focus can help focus innovation for growth Figure 32: Correspondence Analysis – Principal map – Purchase location, August 2018 Figure 33: Where bread and desserts are purchased, by age group, August 2018 CHOICE FACTORS Demand for freshness reflects core appeal of in-store bakery Figure 34: Important factors when choosing a product from an in-store bakery, August 2018 Canadians are looking for natural baked goods Figure 35: Importance of all-natural ingredients when choosing a product from an in-store bakery, by age, August 2018 Added nutrition is a purchase driver Figure 36: Importance of nutrition-related considerations when choosing a product from an in-store bakery, by age, August 2018 New flavours reflects opportunity to differentiate Figure 37: Importance of flavour combinations when choosing a product from an in-store bakery, by age, August 2018 PREVIOUS © Mintel Group Ltd. All rights reserved. NEXT
IN-STORE BAKERY EXPERIENCE - CANADA - NOVEMBER 2018 5 It’s important to remember value’s importance to younger consumers Figure 38: Importance of price vs “baked on same day”, by age group, August 2018 OPPORTUNITIES FOR INNOVATION Opportunity to bring theatre to the bakery Provenance can be the basis for story Figure 39: Areas of interest from in-store bakeries, August 2018 Looking abroad can be an inspiration for innovation at home Figure 40: Interest in internationally-inspired options from in-store bakeries, Chinese Canadians vs overall, August 2018 Canadians fall for seasonal flavours Figure 41: Interest in seasonally-inspired options from in-store bakeries, 18-34s with household incomes of $70K or more vs overall, August 2018 Demand for health innovation at in-store bakeries requires context Figure 42: Interest in health-related considerations from in-store bakeries, 18-44s vs over-45s, August 2018 CONSUMER SEGMENTS Success with women key to in-store bakery’s success Figure 43: Purchase of sweet baked goods from in-store bakeries, by gender, age and parental status, August 2018 Figure 44: Purchase of sweet baked goods from in-store bakeries, by gender, August 2018 Flavour and format exploration key to winning over Chinese Canadians Figure 45: Purchase of sweet baked goods from in-store bakeries, Chinese Canadians vs overall, August 2018 Figure 46: Interest in select options from in-store bakeries, Chinese Canadians vs overall population, August 2018 APPENDIX DATA SOURCES AND ABBREVIATIONS Data sources Sales Data Consumer survey data Correspondence analysis Abbreviations and terms Abbreviations PREVIOUS © Mintel Group Ltd. All rights reserved. NEXT
IN-STORE BAKERY EXPERIENCE - CANADA - NOVEMBER 2018 6 DATABOOK CONTENT Standard demographics vyou can expect to see tracked in our Databooks: • Gender • Age • Gender/age combined • Generation • Race/Hispanic origin • Geographic region • Geographic area (urban, suburban, rural) • Household income • Age/income combined • Employment status • Education level • Presence and number of children in the household • Household size • Marital status • Home ownership status • Social media usage • Mobile device ownership Consumer Research Q1 Which of the following items have you purchased in the past 3 months? Please select all that apply. Q1 Which of the following items have you purchased in the past 3 months? Please select all that apply., by demographics Q2 When did you last purchase each of the following items? Q2 When did you last purchase each of the following items?, by demographics Q3 When did you last purchase each of the following items? Q3 When did you last purchase each of the following items?, by demographics Q4 Which of the following are important to you when choosing a product from an in-store bakery? Please select all that apply. Q4 Which of the following are important to you when choosing a product from an in-store bakery? Please select all that apply., by demographics Q5 Which of the following baked good options would interest you from in-store bakeries? Please select all that apply. Q5 Which of the following baked good options would interest you from in-store bakeries? Please select all that apply., by demographics Q6 Where would you typically go to purchase the following items? Please select all that apply. Q6 Where would you typically go to purchase the following items? Please select all that apply., by demographics Q7 Where would you typically go to purchase the following items? Please select all that apply. Q7 Where would you typically go to purchase the following items? Please select all that apply., by demographics Q8 Where would you typically go to purchase the following items? - NET Q8 Where would you typically go to purchase the following items? - NET, by demographics Q9 Where would you typically go to purchase the following items? Please select all that apply. Q9 Where would you typically go to purchase the following items? Please select all that apply., by demographics Q10 Which of the following statements about bakery items do you agree with? Please select all that apply. Q10 Which of the following statements about bakery items do you agree with? Please select all that apply., by demographics Demographics By Demographics Demographics by demographics PREVIOUS © Mintel Group Ltd. All rights reserved. NEXT
REPORT, US - YEAR MONTH 7 RESEARCH METHODOLOGY PREVIOUS NEXT
CANADA RESEARCH METHODOLOGY 8 Canada Research Methodology Mintel is an independent market analysis research has been conducted using a Female, 18-24 6.9 139 company that prides itself on supplying device agnostic platform for online surveys objective information on a whole range of Female, 25-34 8.8 177 (ie respondents can now take surveys from markets and marketing issues. Female, 35-44 9.4 188 a smartphone in addition to a computer or There are six main sources of research that tablet). This methodology change may result Female, 45-54 8.7 174 are used in the compilation of Mintel reports: in data differences from previous years; any Female, 55-64 8.6 172 trending should be done with caution. • Consumer research Female, 65+ 8.5 170 Sampling • Social media research Total 100 2,000 Online Surveys • Desk research Lightspeed • Trade research Region % N Founded in 1996, Lightspeed's double Ontario 40.2 804 • Statistical forecasting opt-in U.S. online consumer panel contains Quebec 22.1 443 approximately 1.27 million U.S. consumers. British Columbia 13.3 265 Mintel reports are written and managed by Lightspeed recruits its panelists through Alberta 10.7 214 analysts with experience in the relevant many different sources including web Saskatchewan 3.0 61 markets. advertising, permission-based databases and partner-recruited panels. Note: Manitoba 4.8 95 Consumer research Lightspeed GMI was re-branded as Atlantic Provinces Lightspeed in September 2016. (New Brunswick, Newfoundland/ Exclusive and original quantitative 5.9 118 Labrador, Nova consumer research is commissioned Mintel sets quotas on age and gender, Scotia, Prince for almost all Mintel reports. In addition, region, and household income. Specific Edward Island) qualitative research is also undertaken for quotas for a sample of 2,000 adults aged a large proportion of reports in the form of 18+ are shown below. Total* 100 2,000 online discussion groups. Mintel invests a considerable sum each year in consumer Please note: these quotas are only *Mintel does not include rural regions such as the Yukon research, and the purchaser of a Mintel representative of a standard General or the Northwest Territories (including Nunavut) in its report benefits, as the price of an individual Population survey sample of 2,000 internet research. Thus the consumer research data does not report is less than the cost of the original users aged 18+. Sample size, targets, and reflect opinions and behaviours of the population living in research alone. The research brings an quotas may vary per report. Please see the those areas. up-to-date and unique insight into topical Report Appendix for further details. issues of importance. Household income % N Age groups by Less than $25,000 14.0 281 Consumer research is conducted among a % N gender $25,000 - $49,999 20.8 416 nationally representative sample of internet $50,000 - $69,999 15.0 300 users in Canada and is carried out by Male, 18-24 7.9 158 $70,000 - $99,999 17.8 356 Lightspeed. The results are only available in Male, 25-34 9.1 181 $100,000 and over 32.4 647 Mintel reports. Note that Mintel’s exclusive research is conducted online in both English Male, 35-44 10.4 207 and French. Male, 45-54 8.1 163 Total 100 2,000 Male, 55-64 6.1 123 Starting in July 2017, Mintel’s consumer Secondary Data Analysis Male, 65+ 7.4 148 PREVIOUS © Mintel Group Ltd. All rights reserved. NEXT
CANADA RESEARCH METHODOLOGY 9 In addition to exclusively commissioned This is a statistical visualisation method for TURF (Total Unduplicated Reach & surveys, Mintel gathers syndicated data picturing the associations between rows Frequency) analysis identifies the mix from the most respected consumer (image, attitudes) and columns (brands, of features, attributes, or messages that research firms. This allows Mintel analysts products, segments, etc.) of a two-way will attract the largest number of unique to form objective and cohesive analyses contingency table. It allows us to display respondents. It is typically used when the of consumer attitudes and behaviour. brand images (and/or consumer attitudes number of features or attributes must be Qualitative Research towards brands) related to each brand or should be limited, but the goal is still to covered in this survey in a joint space that reach the widest possible audience. By Revelation by FocusVision is easy to understand. The significance of identifying the Total Unduplicated Reach, the relationship between a brand and its it is possible to maximize the number FocusVision provides Mintel with qualitative associated image is measured using the of people who find one or more of their bulletin board software. This allows the Chi-square test. If two brands have similar preferred features or attributes in the creation of Internet-based, ‘virtual’ venues response patterns regarding their perceived product line. The resulting output from where participants recruited from Mintel’s images, they are assigned similar scores TURF is additive, with each additional online surveys gather and engage in on underlying dimensions and will then feature increasing total reach. The chart interactive, text-based discussions led by be displayed close to each other in the is read from left to right, with each arrow Mintel moderators. perceptual map. indicating the incremental change in total reach when adding a new feature. The final Further Analysis CHAID analysis bar represents the maximum reach of the total population when all shown features are Mintel employs numerous quantitative data CHAID (Chi-squared Automatic Interaction offered. analysis techniques to enhance the value Detection), a type of decision tree analysis, of our consumer research. The techniques is used to highlight key target groups in a Social Media Research used vary form one report to another. Below sample by identifying which sub-groups describes some of the more commonly used are more likely to show a particular To complement its exclusive consumer techniques. characteristic. This analysis subdivides the research, Mintel tracks and analyses social sample into a series of subgroups that share media data for inclusion in selected reports. Repertoire Analysis similar characteristics towards a specific Using Infegy’s Atlas software, Mintel ‘listens response variable and allows us to identify in’ on online conversations across a range This is used to create consumer groups which combinations have the highest of social platforms including Facebook, based on reported behaviour or attitudes. response rates for the target variable. It is Twitter, consumer forums and the wider Consumer responses of the same value commonly used to understand and visualise web. (or list of values) across a list of survey the relationship between a variable of items are tallied into a single variable. interest such as “interest in trying a new Atlas provides rich consumer insight via The repertoire variable summarises the product” and other characteristics of the the analysis of commentary posted publicly number of occurrences in which the value sample, such as demographic composition. on the internet. The system performs or values appear among a list of survey comprehensive and broad collection of items. For example, a repertoire of brand Key Driver Analysis data from millions of internet sources, purchasing might produce groups of those working to ensure a faithful and extensive that purchase 1-2 brands, 3-4 brands and 5 Key driver analysis can be a useful tool in sampling of feedback from the widest or more brands. Each subgroup should be helping to prioritise focus between different range of individuals. The dataset contains large enough (ie N=75+) to analyse. factors which may impact key performance commentary posted in real time, as well as indicators (eg satisfaction, likelihood to a substantial archive dating back through Cluster Analysis switch providers, likelihood to recommend 2007. a brand, etc). Using correlations analysis This technique assigns a set of individual or regression analysis we can get an Trade research people in to groups called clusters on the understanding of which factors or attributes basis of one or more question responses, of a market have the strongest association Informal so that respondents within the same cluster or “link” with a positive performance on are in some sense closer or more similar to key performance indicators (KPIs). Hence, Trade research is undertaken for all reports. one another than to respondents that were we are able to identify which factors or This involves contacting relevant players grouped into a different cluster. attributes are relatively more critical in a in the trade, not only to gain information market category compared to others and concerning their own operations, but also Correspondence Analysis ensures that often limited resources can be to obtain explanations and views of the allocated to focusing on the main market strategic issues pertinent to the market drivers. being researched. Such is Mintel’s concern with accuracy that draft copies of reports are TURF Analysis sent to industry representatives, to get their PREVIOUS © Mintel Group Ltd. All rights reserved. NEXT
CANADA RESEARCH METHODOLOGY 10 feedback and avoid any misrepresentation as Statistics Canada and the Canadian forecast are collated in Mintel’s own market of the market. These comments are Grocer. Other information is also gathered size database and supplemented by macro- incorporated into reports prior to final from store and exhibition visits across and socio-economic data sourced from publication. Canada, as well as using other databases organisations such as Statistics Canada, within the Mintel Group, such as the Global The Bank of Canada, The Conference Formal New Product Database (GNPD), which Board of Canada and the Economist Internally, Mintel’s analysts undertake monitors FMCG sales promotions. Intelligence Unit. extensive trade interviews with selected key experts in the field for the majority of All analysts have access to Mintel’s Market Within the forecasting process, the model reports. The purpose of these interviews Size and Macroeconomic Databases – searches for, and analyses relationships is to assess key issues in the market a database containing many areas of between, actual market sizes and a place in order to ensure that any research consumer spending and retail sales as well selection of key economic and demographic undertaken takes these into account. as macroeconomic and demographic factors factors (independent variables) in order to which impinge on consumer spending identify those predictors having the most In addition, using experienced external patterns.. influence on the market. researchers, trade research is undertaken for some reports. This takes the form of The database is used in conjunction with Factors used in a forecast are stated in full trade interview questionnaires and an SPSS forecasting program which uses the relevant report section alongside an direct quotes are included in the report and weighted historical correlations of market interpretation of their role in explaining the analysed by experts in the field. This gives a dynamics, with independent variables, to development in demand for the product or valuable insight into a range of trade views produce future spending scenarios. market in question. of topical issues. Statistical Forecasting Qualitative insight Desk research Statistical modelling At Mintel we understand that historic data is Mintel has an internal team of market limited in its capacity to act as the only force analysts who monitor: government statistics, For the majority of reports, Mintel produces behind the future state of markets. Thus, consumer and trade association statistics, five-year forecasts based on an advanced rich qualitative insights from industry experts manufacturer sponsored reports, annual statistical technique known as ‘multivariate regarding past and future events that may company reports and accounts, directories, time series auto-regression’ using the impact the market play a crucial role in our press articles from around the world and statistical software package SPSS. post statistical modeling evaluation process. online databases. The latter are extracted from hundreds of publications and websites, Historical market size data feeding into each both Canada and overseas. All information is cross-referenced for immediate access. Data from other published sources are the latest available at the time of writing the report. This information is supplemented by an extensive library of Mintel’s reports produced since 1972 globally and added to each year by the 500+ reports which are produced annually. In addition to in-house sources, researchers also occasionally use outside libraries such PREVIOUS © Mintel Group Ltd. All rights reserved. NEXT
CANADA RESEARCH METHODOLOGY 11 As a result, the Mintel forecast allows for fall within these outer limits, which we call Weather analogy additional factors or market conditions the best and worst case forecasts. These, outside of the capacity of the data analysis based on the statistically driven forecast, To illustrate uncertainty in forecasting in to impact the market forecast model, using are the highest (best case) and lowest an everyday example, let us assume the a rigorous statistical process complemented (worst case) market sizes the market is following weather forecast was produced by in-depth market knowledge and expected to achieve. based on the meteorologists’ current expertise. knowledge of the previous weather condition Over the next five years, the widening during the last few days, atmospheric The Mintel fan chart bands successively show the developments observations, incoming weather fronts etc. that occur within 95%, 90%, 70% and 50% Forecasts of future economic outcomes probability intervals. Statistical processes Now, how accurate is this forecast and how are always subject to uncertainty. In order predict the central forecast to fall within the certain can we be that the temperature on to raise awareness amongst our clients darker shaded area which illustrates 50% Saturday will indeed be 15°C? and to illustrate this uncertainty, Mintel has probability, i.e. a 5 in 10 chance. introduced a new way of displaying market To state that the temperature in central size forecasts in the form of a fan-chart. A general conclusion: Based on our current London on Saturday will rise to exactly 15°C knowledge of given historic market size data is possible but one can’t be 100% certain Next to historical market sizes and a current as well as projections for key macro- and about that fact. year estimate, the fan chart illustrates the socio-economic measures that were used to probability of various outcomes for the create the forecast, we can assume that in To say the temperature on Saturday will market value/volume over the next five 95% of the time the actual market size will be between 13°C and 17°C is a broader years. fall within the purple shaded fan. In 5% of all statement and much more probable. cases this model might not be correct due At a 95% confidence interval, we are saying to random errors and the actual market size In general, we can say that based on the that 95 out of 100 times the forecast will will fall out of these boundaries. existing statistical model, one can be 95% certain that the temperature on Saturday will be between 13°C and 17°C, and respectively 50% certain it will be between about 14.5°C and 15.5°C. Again, only in 5% of all cases this model might not be correct due to random errors and the actual temperature on Saturday will fall out of these boundaries and thus will be below 13°C or above 17°C. (To learn more about uncertainty in weather forecasts visit: http://research.metoffice.gov. uk/research/nwp/ensemble/uncertainty.html) PREVIOUS © Mintel Group Ltd. All rights reserved. NEXT
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