Cereals took on new importance in 2020 as people sought comfort, convenience and family centric fare. 58% of North American consumers will change their cereal habits in the future (IFF Proprietary Online Research, 2021). As breakfast habits change, cereal brands are finding innovative ways to increase their relevance and engage with consumers. Fun, healthy indulgence and convenience are 3 important factors to take into account for cereal innovation.
First, fun. To provide excitement and fun, brands should look at indulgence-driven innovation: cross-over products like mini-cookie-cereal can fill a market gap for more indulgent adult cereal. To bring a touch of nostalgia and a smile to people’s face in the morning, cereal brands can play with flavors and fun formats.
Second, healthy indulgence. Low/ no sugar stays an important driver in breakfast cereal, along with fibre, natural, high protein and super foods (IFF Research). 44% of UK consumers are looking for satiety in breakfast cereal ('feeling full for longer', Mintel, The Future of Breakfast Cereal, 2022), while 48% of US consumers say that taste is more important than health when choosing breakfast cereal. Cereal that provides healthy indulgence is going to be key to success.
Third, convenience. Today’s health-minded breakfast cereal consumers are increasingly looking for portable and convenient, better-for-you cereal formulations. A sit-down breakfast is a time luxury many cannot afford, and consumers seek something they can eat on the go, not only for breakfast but also on other occasions during the day.
Source: IFF Proprietary Online Research 2021, n=2,025 consumers, US & Canada, Cereal product users
With the stay-at-home trend since covid, breakfast cereal has reclaimed its traditional place in households. And cereal can grow outside the breakfast category too. Let’s look at 3 tips for repositioning breakfast cereal as a snack product.
Breakfast cereal can be a nutritious and tasty snack, whether it be in the car or at the office, as an afternoon pick-me-up, or post-workout treat. On-the-go is still relevant for global new breakfast cereal launches in the new normal: after a slight decline in new product launches with ‘on-the-go’ claim in 2021, we see an increase of 19% of breakfast cereal with on-the-go claim again in 2022.
On-the-go is an established eating moment for breakfast cereal but what about other snacking occasions? Kantar’s report “Eat, Drink & Be Healthy (February 2019)” shows that snacking accounts for close to 1 in every 4 at-home occasions, with afternoon and after dinner being the most popular, while morning snacks are growing the fastest. In particular since covid-19, at-home snacking is now a focus area (Mintel, Cereals as snacks for more consumption occasions, September 2021).
This is where it gets interesting for cereal: if you look at Kantar’s infographic with the most popular snack choices below, you will notice that people tend to choose biscuit-style products in the mid afternoon and after dinner: these are unexplored eating moments for cereal (especially for filled cereal) to position as a guilt-free tasty little treat. In the post-covid era, brands are making cereal more relevant across the day with convenient and snackable formats, such as pots, overnight oats and single-serve portions.
Infographic based on Mintel GNPD
There is a clear overlap between breakfast cereal and cookies: several breakfast cereal types, like mini waffles or cereal pillows, look like a mini biscuit, which makes them a perfectly permissible snack. #breakfastallday is here to stay.
Let’s have a look at KIND Mini’s. Global insight specialists from New Nutrition Business made a good analysis of the success story of this product in March. The launch by KIND – one of the most successful ‘all-natural’ snack bar brands of the last 10 years with over $700 million (€617 million) in sales – saw the company adopt one of the most successful snack brand strategies. When a company can find a way to reconcile indulgence and guilt-free eating, the rewards are significant.
Positioning a product so that people can give themselves the go-ahead to enjoy it and at the same time feel virtuous about their choice, is a very smart strategy.
In the June 2019 report about The Future of Breakfast Cereal, Mintel even dedicated a full section to cereal pillow snacks, to demonstrate how they blur category lines and generate growth.
2021 marked the launch of Oreo O’s mini cookies cereal in UK and Ireland: the familiar trusted Oreo cookie is turned into playful cereal for adults looking for an indulgent breakfast or a little treat at any time of the day. A little bowl of nostalgia can offer emotional wellbeing. We also see creative uses of Oreo O’s are popping up, e.g. in baking and in overnight oats.
Aimed at both children and adults, new product development activity in filled cereal is on the up. In the five-year period to June 2019, there was a 49% increase in the number of global filled cereal launches, with France taking the lead in innovation (Mintel Report 'Filled cereals meet the need for snackable indulgence', July 2019). The pillow format is similar to that of a mini biscuit and makes them perfect for any-time-of-day snacking, and out-of-home occasions. Looking to Mintel’s global new products database we see that, particularly in Europe, in the last 6 months cereal/wheat pillows with a cream-based filling are being positioned in the Bakery – sweet biscuits/cookies category, rather than just the breakfast cereal category.
Due to their indulgent nature and strong visual appeal, cereals with fillings have traditionally targeted the younger end of the age spectrum, however young adults are quickly becoming a particularly interesting audience.
Filled cereals have so far delivered limited flavour experience, with chocolate notes dominating innovation activity. Development opportunities therefore exist to inject greater flavour variety – for example, by exploring:
Consumers are looking for improvements in cereal products. Cereal products in which natural ingredients replace artificial ones, as well as those with reduced sugar and/or added functional ingredients like fiber respond to cereal eaters' desire for healthier alternatives. Think of sugar reduced cereal fillings and sugar-free bindings for granola. The key is finding a way to ensure that the taste and crispy texture of the cereal is not compromised.
The time is right for brands to innovate in cereal, since cereal reclaimed its place in households since 2020, as people sought comfort, convenience. Fun, healthy indulgence and convenience are 3 key drivers for innovation in the category. Broadening cereal eating moments to an afternoon & evening snack, mini-formats and filled cereal are opportunities worth exploring, if you want to shake things up in cereal.