Bread: brands go posh to rise above inflation

At last, some of Britain’s bakers look poised to start making some decent dough again. The market, which has been in value decline in this report for the past four consecutive years, is now almost at breakeven, down just 0.3%.

Star performer Hovis is up 9.1% on volumes up 1.5%. Its £25.4m gain makes it the year’s seventh-fastest growing food or drink product and ends five consecutive years of decline in this report. Hovis’ average price is up 7.4%, the steepest rise of any of the big brands, thanks partly to value-added innovation and 2016 improvements to its core Soft White loaf.

“New products have certainly helped to drive interest into the category, but it’s down to our focus on supporting our core range with a multimillion pound investment that has driven exponential growth for Hovis,” market strategy & planning director Ed Milner told us earlier this year.

Pricier seeded loaves have also been a focus for Hovis. “Bread with bits is certainly a sector that continues to be a growth driver, meeting consumers’ needs for variety and taste,” added Milner. “Hovis leads this area as the number one brand. The Seed Sensations range has been hugely successful.”

Warburtons is also pushing its Seeded Batch Five Seeds Loaf, which carries an almost 50% premium over its Toastie loaves, in ads with Peter Kay. That’s not all, says category development director David Tittensor. “NPD continues to be a key area of investment for Warburtons,” he says. “Our commitment to adding excitement to bakery and attracting new shoppers to wrapped bread and other bakery sectors is demonstrated by recent launches, such as Giant Crumpets, the Protein range and Toastie Pockets.”

Hovis and Warbies aren’t the only ones looking to drive value back into Britain’s most widely bought grocery product. “Our own value-added strategy is firmly focused on baking premium products for the everyday,” says Stuart Spencer-Calnan, MD at Roberts. “We’re challenging consumers and customers to think differently about bread.”

The need for such action from brands has never been greater, despite the tentative signs of a recovery at category level. Own label (up 13.9% on volumes up 13.3%) is stealing share from brands as consumers trade down to offset rising prices on branded standard loaves.

In November Allied Bakeries warned it would push through higher prices to recoup losses incurred by surging wheat costs. “That is mainly because of the decline in the value of the pound,” said Alex Waugh, director of the National Association of British and Irish Flour Millers. “Wheat is priced globally so the exchange rate really makes a difference.”

What will make the difference between profit and loss for bakers will be the strength of NPD. Expect more posh loaves in 2018.

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Gin & Tonic Fun Buns by Roberts

With gin so achingly fashionable these days, and wrapped loaves less so, it made sense Roberts would come up with these trendy treats to add pizzazz to the bakery aisle. Not surprisingly, they were one of the hero products for the bakery’s summer relaunch. In their eyecatching packaging, the scone-like buns encapsulate the revamped brand’s livelier, more contemporary identity and positioning, while also tapping consumer taste for ‘zingy’ flavour through their lemony flavour notes.