Abstract

About this report

• Just over 9m consumers have a wide selection (ie four or five) of breakfast cereals in their cupboards, principally but not exclusively multigrain-based recipes, low fat, children' s or honey based cereals.
• Health considerations are the top priority when choosing a breakfast cereal, with 43% of consumers checking the amount of sugar in their cereal.
• Buying a cereal that their whole family can eat is an important purchase consideration for 8.5m consumers.
• Almost 24% consumers claim to only buy branded cereals, but 26% feel there is no difference between own label and branded cereals.
• Consumers seek variety in their breakfast cereals, especially as almost 15m claim to get bored of eating the same cereal everyday.
• Retailers should make better use of cross-branding opportunities between breakfast cereals, fruits and yogurts; 6m consumers eat their cereals with fresh fruit or yogurt.

Table of Contents

Issues in the Market

• Key themes
• Definitions
• Consumer research
• mysupermarket-insights.co.uk

Market in Brief

• Performance of the breakfast cereal market
• The importance of breakfast...especially for children
• A healthy eating message
• NPD increases consumer choice
• Consumer attitudes and preferences

Internal Market Environment

• Key points
• Starting the day with breakfast
  • Figure 1: Attitudes towards breakfast, December 2009
• Attitudes towards health and diet
  • Figure 2: Agreement with selected lifestyle statements on diet and health, 2005-09
• A healthier breakfast balance
  • Figure 3: Household purchased quantities of food and drink, 2004/05-2007
• Kellogg' s comes under fire

Broader Market Environment

• Key points
• Cereals under fire
• Fluctuating commodity prices
  • Figure 4: UK commodity price of cereals, January 2004-November 2009
• Over-65s set to experience the fastest growth
  • Figure 5: Trends and projections in UK population, by age group, 2004-14
• The working mother
  • Figure 6: Working population, by gender, 2004-14
• Competitive Context
• Key points
• Cereal a popular breakfast choice for children
  • Figure 7: Trends in things eaten for breakfast - 7-10-year-olds, 2004-09
• Several choices at the breakfast table
  • Figure 8: Competing products with breakfast cereals, 2004-09

Strengths and Weaknesses in the Market

• Strengths
• Weaknesses
• Market Value and Forecast
• Key points
• Value sales growth in a mature market
  • Figure 14: UK retail volume and value sales of breakfast cereals, 2004-14
• Recession keeps consumers at the breakfast table
• Future sales growth
  • Figure 15: Forecast retail volume and value sales of RTE cereal, 2004-14
  • Figure 16: Forecast retail volume and value sales of hot cereals, 2004-14
• Factors used in the forecast

Segment Performance

• Key points
• Ready-to-eat cereals maintain their lead
  • Figure 17: UK retail volume and value sales of RTE cereal, 2004-14
• Consumers encouraged to eat well
  • Figure 18: Value share of sub-sections of the RTE breakfast cereal market, 2009
• Backing the healthy ranges
• Kids' cereals remain competitive
• Hot on the heels of RTE cereals
  • Figure 19: UK retail volume and value sales of hot cereals, 2004-14

Market Share

• Key points
• Consumers opt for healthier cereals
  • Figure 20: The top-selling breakfast cereals in the UK, by estimated brand shares, 2008 and 2009
• Weetabix holds on to top spot
• Opting for some Special K
• Kids' choice
• Oatso good
• Own-label encroaches on brand share

Companies and Products

Manufacturers and brands

• Figure 21: Leading companies in the breakfast cereal market in the UK and their brands, 2009
• Major players
• Cereal Partners UK
• Dorset Cereals
  • Figure 22: New breakfast cereals launched by Dorset Cereals, 2008 and 2009
• Honey Monster Foods
  • Figure 23: New product launches by honey monster foods, 2009
• Jordans
  • Figure 24: Examples of new product launches by Jordans, 2008 and 2009
• Kallo Foods
• Kellogg' s
  • Figure 25: Examples of new product launches by Kellogg' s, 2008 and 2009
• PepsiCo (Quaker)
  • Figure 26: New breakfast cereal launches by Quaker 2008 and 2009
• Weetabix
  • Figure 27: New breakfast cereals launched by Weetabix after February 2008
• Mornflake
  • Figure 28: New Breakfast cereals launched by Mornflake Oats, 2009

Other manufacturers

• Doves Farm

Brand Communication and Promotion

• Key points
• Manufacturers maintain above-the-line expenditure
  • Figure 42: Main monitored media advertising expenditure on breakfast cereals, 2006-09
• Focus on TV
  • Figure 43: Main monitored media advertising expenditure on breakfast cereals, by medium, 2006-09
• Kellogg' s outspends its competitors
  • Figure 44: Adspend of top ten advertisers in the cereal bars market, 2006-09
• Nestle and Weetabix promote their ranges
• Retailer promotional activity
  • Figure 45: Trends in promotional activity for breakfast cereals, December 2007-November 2009

Channels to Market

• Key points
• Supermarkets still lead the breakfast cereal market
  • Figure 46: UK retail distribution of breakfast cereals, 2005-09
• Manufacturers work closely with convenience stores
• Tesco stocks the widest range of breakfast cereals
  • Figure 47: Trends in total number of SKUs in the breakfast cereal market, December 2007-November 2009

The Consumer - Usage and Frequency

• Key points
• Cold cereals feed the masses
  • Figure 48: Consumption of cold breakfast cereals in the last 12 months, 2004-09
  • Figure 49: Most valuable consumers for volume sales of hot cereals, by gender, age and presence of children in the household, 2009
• Growing popularity of hot cereals
  • Figure 50: Consumption of hot breakfast cereals (porridge/oats) in the last 12 months, 2004-09
• Older consumers favour hot cereals
  • Figure 51: Consumption of hot breakfast cereals in the last 12 months, by age, 2009
• Penetration of cereal bars still low
  • Figure 52: Consumption of cereal bars, cold breakfast cereals and hot breakfast cereals in the last 12 months, 2004-09

Targeting Breakfast Cereal Groups

• Key points
  • Figure 59: Consumer clusters for breakfast cereals, December 2009
• Cereal Adventurists (16%)
• Who are they?
• Types of cereals eaten
• What are their attitudes towards breakfast cereals?
• Cereal Experimenters (24%)
• Who are they?
• Types of cereals eaten
• What are their attitudes towards breakfast cereals?
• Habitual Cerealists (19%)
• Who are they?
• Types of cereals eaten
• What are their attitudes towards breakfast cereals?
• Branded Cerealists (41%)
• Who are they?
• Types of cereals eaten
• What are their attitudes towards breakfast cereals?

Appendix

• Advertising data
• Abbreviations
• Appendix - Internal Market Environment
• Figure 60: Agreement with selected lifestyle statements on diet and health, by demographics, 2009
• Figure 61: Agreement with selected lifestyle statements on diet and health, by demographics, 2009 (continued)

Appendix - Broader Market Environment

• Figure 62: Where do you eat breakfast, by demographics, December 2009

Appendix - Who' s Innovating?

• Figure 65: Percentage of NPD, by manufacturer, 2008 and 2009

Appendix - Market Value and Forecast

• Figure 66: Consumer Price Index: food categories, January 2006-September 2009
• Figure 67: Trends in personal concerns, June-December 2009*
• Figure 68: UK retail volume and value sales of breakfast cereal, by type, 2005-09

Appendix - Brand Communication and Promotion

• Figure 69: Trends in own-label SKUs in the breakfast cereal market, December 2007-November 2009

Appendix - The Consumer: Usage and Frequency

• Figure 70: Consumption of cold breakfast cereals in the last 12 months, by demographics, 2009
• Figure 71: Consumption of hot breakfast cereals (porridge/oats) in the last 12 months, by demographics, 2009

Appendix - Targeting Breakfast Cereal Groups

• Figure 86: Number of different types of breakfast cereals in cupboard at home, by target groups, December 2009
• Figure 87: Type of breakfast cereals eaten, by target groups, December 2009
• Figure 88: Factors taken into account for choosing a breakfast cereal, by target groups, December 2009
• Figure 89: Attitudes towards breakfast cereals, by target groups, December 2009
• Figure 90: Target groups, by demographics, December 2009