Bakery is a commonly shopped category for Americans. 100% of U.S. consumers report their household purchased a baked good in the last year with 8 in 10 buying a pre-packaged branded bakery product and 7 in 10 buying an item from the fresh bakery. We set out to understand how the better-for-you food movement is impacting the bakery category through our latest consumer insights.
PRICE, QUALITY, AND FRESHNESS ARE THE MOST IMPORTANT FACTORS WHEN IT COMES TO BAKERY PURCHASES
When asked to rank the top 3 factors most important to making a bakery purchase, consumers consistently rank price, quality and freshness in the top three spots. When shopping pre-packaged branded bakery, price (71%) is the top factor followed by quality (60%) and then freshness (47%). With fresh bakery, consumers rank quality first (67%) followed by freshness (66%) and price (59%), indicating they are willing to pay a premium for the perceived higher quality of fresh bakery.
MORE THAN HALF (55-57%) OF BAKERY PURCHASERS CONSIDER BETTER-FOR-YOU ATTRIBUTES WHEN PURCHASING BAKERY ITEMS
When presented with a list of better-for-you attributes, 55% of pre-packaged branded bakery purchasers and 57% of fresh bakery purchasers reported that one or more of the attributes was important when considering purchasing bakery products.
When it comes to pre-packaged branded bakery goods, the most widely considered attributes are all-natural (22%), low in sugar (22%), limited ingredients (22%), and nothing artificial (19%). These same top attributes are important to consumers when making fresh bakery selections.
Beyond all-natural, there is a segment of consumers that is seeking bakery products that are free from common allergens. The free from attributes that are most important to consumers buying pre-packaged branded bakery goods are gluten-free (17%), dairy-free (13%), and vegan (10%). We also see a segment of consumers who are seeking bakery products to support their specific eating philosophy/strategy including Ketogenic (10%), plant-based (9%), and Paleo (9%). These diets are on the rise in general, so it is not surprising that they also influence bakery decisions.
When it comes to production practices, organic and sustainable attributes are important in the bakery selection of 13% and 11% of those shopping pre-packaged branded bakery, respectively.
1 IN 5 BAKERY CONSUMERS ARE MOTIVATED TO PAY MORE FOR ALL-NATURAL OFFERINGS
When asked if they would be willing to pay more for better-for-you attributes, 22% of consumers reported they would be willing to pay more for an all-natural pre-packaged branded bakery good and 25% for an all-natural fresh bakery good. Other top attributes consumers are willing to pay more for include low sugar (19%), organic (18%), and gluten free (15%).
CONSUMERS ARE SEEKING BETTER-FOR-YOU BAKERY OUTSIDE OF TRADITIONAL GROCERY
Over 50% of consumers report shopping traditional grocery for baked goods including pre-packaged brand and fresh bakery goods. Mass merchandise stores are equally as popular for shopping for pre-packaged baked goods (58%). Other channels popular for fresh bakery goods are mass merchandise (43%), local bakery (25%), and natural/specialty (23%).
The consumer who is seeking better-for-you attributes in their bakery products is shopping traditional grocery (61%) but is also significantly more likely to shop for bakery outside of traditional grocery to meet their specific needs. Popular channels among the better-for-you bakery consumer are discount grocery (30%), natural/specialty grocery (24%), Amazon (23%), and other online grocery (15%).
IMPLICATIONS FOR RETAILERS AND MANUFACTURERS:
- The growing demand for better-for-you attributes has extended to bakery. To appeal to the 50% of consumers who are seeking these attributes, consider the role of all-natural ingredients in your products and extensions that offer ‘free from’ specific allergens to expand appeal.
- Consumers are even more discerning with their better-for-you selections in fresh bakery given the expectations for quality and freshness. Promote and highlight better-for-you and fresh practices in the fresh bakery section to capture this shopper.
- Consumers are willing to pay more for better-for-you attributes, so consider the role of these attributes in brand tiering and pricing strategies.
This analysis is based on an examination of 1,001 interviews from the Free From Forum’s Market Monitor. Interviews were conducted in April 2019. There were 1,001 people whose households have purchased a bakery product in the past 12 months.
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2019 Linkage Research
Linkage Research 2019