Bread sales are getting back to levels seen before they spiked during the coronavirus (COVID-19) pandemic, but figuring out what will come next could be tricky. Will inflation drive sales down and push consumers to choose cheaper options, or will budget-conscious consumers actually stick with their favorite premium brands instead of eating out?
“Year to date, if you look at sandwich breads, unit sales are just about flat, so it’s not terribly far off from pre-pandemic levels. Supply chain is likely driving that decline,” said Melissa Altobelli, principal, strategic solutions group, IRI. “I think it will be interesting to see what happens as inflation continues because people are facing higher prices in a lot of areas: rising gas prices, transportation, apparel — everything is going up — so there’s going to have to be tradeoffs on how consumers spend their money.”
Healthy premium choices, such as keto, low-carb and gluten-free breads, are driving growth in the category, she said, although mainstream sandwich breads still make up the bulk of sales.
“Many households are buying both the healthful bread with mom on the keto diet or with sensitivity to gluten, but she’s still buying regular, mainstream bread for the kids,” Ms. Altobelli said. “There could be some trade down because now they have a shrinking wallet. Folks who bought both the premium bread for themselves and regular — whether it’s white or wheat or rye for the kids — perhaps they’re going to just eat what the kids do. There’s a lot of dynamics that we need to watch to see what’s going to happen.”
But Americans are still buying plenty of bread. Center-store bread and roll sales were up 2.3% to $16.3 billion for the 52 weeks ending April 17, 2022, with unit sales down 4.5%, according to IRI. Perimeter bread and roll sales for that same period were up 8.3% to $3.3 billion, and unit sales were up 8.8%, IRI reported.
Innovation may have slowed a bit over the past couple of years, but bakers are finding plenty of new ways to engage with consumers, whether it’s extending popular premium brands or experimenting with alternate flours.
Although consumers may not be making the best food choices at every meal, they are often choosing something better, according to the recent “What’s in Store” trends analysis from the International Dairy, Deli, Bakery Association (IDDBA).
“Healthier eating has been an area of on and off focus for many Americans,” the report stated. “The pandemic prompted a greater focus on health, with a particular emphasis on immunity but also on emotional well-being. In fact, 95% of Americans believe physical health and emotional well-being are interconnected, according to 210 Analytics.”
The report goes on to say that consumers are seeking to minimize what they see as the bad, such as artificial flavors and salt, while pursuing attributes they see as positive, such as protein, fiber and antioxidants.
Innovating in the areas of health, wellness and premium breads is the best way for bakers to engage with consumers, Ms. Altobelli said.
“Innovation and healthier options such as low-cal, low-carb, good source of fiber, non-GMO, keto, gluten-free, protein — there’s all sorts of claims out there,” she said. “And on the premium front, it’s artisan, rich flavors, thick bread.”
Ms. Altobelli cited Sara Lee, owned by Horsham, Pa.-based Bimbo Bakeries USA, as one brand finding a lot of success.
“Sara Lee is growing on a lot of fronts,” she said. “Their regular center-store sandwich bread, their Sara Lee Artisano bread, and they have a new Delightful, which is a low-calorie offering — those are growing across the board. And there’s a new keto bread, Lewis Healthy Life. Keto bread, though small, is also driving growth.”
King’s Hawaiian, Torrance, Calif., recently launched Original Hawaiian Sweet Pretzel Hamburger Buns and Slider Buns to give consumers a premium pretzel bread with a new twist.
“These King’s Hawaiian Pretzel bread offerings have all the irresistible characteristics of our original Hawaiian sweet bread — soft, sweet and fluffy — combined with a salty pretzel exterior that makes for an incredible sweet and salty combination,” said Chad Donvito, president of King’s Hawaiian.
He added that research and development is focused on high-quality products that bring fun to both meals and snacking, which the company sees as delivering the most success for King’s Hawaiian.
Flowers Foods, Thomasville, Ga., has brands that fit into several of the healthy and premium categories, including Dave’s Killer Bread, Nature’s Own Perfectly Crafted and gluten-free brand Canyon Bakehouse, which recently launched a brioche dinner roll.
“Our brand legacy is built around inclusion and giving people back the sense of normalcy when it comes to eating bread. Something as simple as a dinner roll can have a tremendous impact when it lives up to the expectations of great taste, wholesomeness and high-quality ingredients,” said Mark Courtney, chief brand officer for Flowers Foods. “A dinner roll seemed to be a perfect fit, given the success of other Canyon Bakehouse product extensions, including buns, bagels and English muffins.”
Nature’s Own recently launched two new breads, Hawaiian and Perfectly Crafted Sourdough, both of which were inspired by consumer preferences.
“The Nature’s Own brand team gathers consumer insights about the flavors, sizes and other attributes consumers would like to see,” Mr. Courtney said. “Both Hawaiian and Sourdough scored on par with some of our best sellers in each line, so we felt confident consumers wanted these items.”
This article is an excerpt from the July 2022 issue of Baking & Snack. To read the entire feature on Bread, click here.