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Canadian Grocer: Is cereal making a comeback?Tuesday, August 18, 2015 > 09:26:49
From better-for-you brands to kids' classics and even porridge, cereal is fighting to make a comeback at the breakfast table
Is it crunch time for the cereal aisle?
Certainly seems so. The once undisputed breakfast of champions is under fire from all sides: the anti- sugar movement, the Tim Hortons’ drive-thru, smoothies and a host of on-the-go bars and meals that allow Canadians to eat breakfast anywhere, at any time, without needing to worry about balancing a bowlful of milk.
Ready-to-eat cereals in particular have taken a hit. Sales are down 1% in dollars and flat in units for the 52 weeks to March 7, according to Nielsen.
But it’s not all bad news for Tony the Tiger, Cap’n Crunch and Cornelius Rooster. Canadians may be buying less RTE cereal, but almost 80% still munch on it for breakfast, accord- ing to a recent Kellogg’s poll.
Likewise, Euromonitor reports that products marketed with healthy halos, such as organic, reduced sugar and high fibre, are winning in the cereal aisle. Organic in particular is a share stealer. Sales of organic cereals were up 11% across all channels for the 52 weeks to Jan. 10, according to Nielsen data from Nature’s Path Foods.
Darren Mahaffy, vice- president at Nature’s Path, isn’t surprised by organic’s double-digit rise. The cereal aisle is crowded. Customers are using health labels, such as non-GMO, low sugar, no artificial additives or gluten free, “to help simplify their choices,” he says.
Ingredients that are either healthy or trendy are also stopping shoppers in their tracks. Among these: chia, hemp, coconut, flax, dark chocolate and ancient grains.
Not surprisingly, top sellers at Nature’s Path include Pumpkin Flax Plus cereal and Coconut Chia granola, says Mahaffy. On the dark chocolate side, General Mills launched a dark chocolate and cranberry version of its Oatmeal Crisp this June.
Cereal makers are changing the conversation on health, too. Take Kellogg’s. For more than a decade, its Special K brand was known for the “Special K Challenge,” which promised that people could shed pounds by eating the cereal.
The trouble with that strategy, according to Kellogg CEO, John Bryant, was that Kellogg was “basically asking people to deprive themselves.”
In response, Kellogg is developing products meant to make people feel good about themselves while also keeping in-line with current trends. For instance, consumers want protein-rich breakfasts and meals that make them feel fuller, longer. So, Kellogg has launched its Special K Protein range.
Hot cereal is also heating up the breakfast table. Sales are up 3% in the last year, according to Nielsen data. Some of hot cereal’s appeal may be from South Asian and Chinese consumers who grew up eating hot cereal at home.
But hot cereal’s appeal appears broader than that, with old favourites such as oatmeal gaining a following.
“Porridge has become the all-family cereal option. It’s moving from a winter option to an all-season product,” says Susan Jacobson, chairman at DoveTale Collections, the Canadian distributor of Rude Health porridges, from England.
But while consumers may be more serious about eating healthy cereals, our appetite for “fun and sweet” varieties is surprisingly strong, says Emma Eriksson, marketing director with General Mills Canada. Lucky Charms, for example, enjoyed 20% growth between 2012 and 2014. No wonder General Mills is launching new varieties such as Chocolate Lucky Charms, a treat for millennials and their kids.
Lucky Charms is one of several iconic kids’ cereal brands that General Mills has had success with in the past year. For Easter, the company brought back Trix for a limited time, and last fall it re-introduced Count Chocula and Frankenberry for Halloween.
All three brands had been pulled from shelves a decade ago as parents cut back on serving their kids sugary cereals. But those cereals lived on in the memories of those who grew up with them during the 1970s and ’80s, which is why the relaunched Trix and Count Chocula were aimed mostly at adults. Boxes of Count Chocula sold out at stores before Halloween, according to General Mills, and the brand could return this fall, while Trix may be on shelves by Easter.
Alas, the return of the Count and Trix Rabbit probably didn’t help cereal’s reputation. Over 40% of Ipsos survey respondents said sugar content prevents them from buying or eating cereal. To counter such views, Breakfast Cereals Canada, an association representing Kellogg, General Mills, Post and Quaker, is forging ahead with its educational “What’s in the Bowl” campaign.
BCC’s executive director, Kathryn Fitzwilliam, says this year the group aims to “engage in online conversation with bloggers and other influencers about the goodness of the breakfast cereal.”
The goal, of course, is to give cereal sales a lift. Now wouldn’t that be gr-r-eat?