Table of Contents
The Impact of COVID-19 on Cakes, Cake Bars and Sweet Baked Goods
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- Short, medium and long-term impact on the industry
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- Figure 1: Expected impact of COVID-19 on cakes, cake bars and sweet baked goods, short, medium and long-term, 5 May 2020
- Opportunities and Threats
- COVID-19 unlikely to have long-term negative impact
- Opportunities lie in targeting evening occasions
- Brands should emphasise how cake can bring people together (virtually)
- Focus on health is expected to endure
- Impact on the market
- 2020 will see cakes, cake bars and sweet baked goods sales hit
- The market will begin to recover in 2021
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- Figure 2: Forecast of UK retail value sales of cakes, cake bars and sweet baked goods (adjusted for COVID-19), 2014-24
- Supermarkets struggled with availability
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- Figure 3: Not being able to buy out-of-stock products and shopping more from local businesses since the start of the COVID-19/coronavirus outbreak, 26th March 2020-9th April 2020
- Local bakeries explore delivery
- Impulse purchases hit as people limit supermarket visits
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- Figure 4: Trying to limit time spent in-store and cutting back on non-essential spending since the start of the COVID-19/coronavirus outbreak, 26th March 2020-9th April 2020
- Shifts in consumer behaviour
- Focus on health is expected to endure
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- Figure 5: Change in priorities regarding eating healthily since the start of the COVID-19/coronavirus outbreak, by age and presence of children,16th-23rd April 2020
- Support for local producers holds potential beyond the crisis
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- Figure 6: Change in priorities regarding one’s local community since the start of the COVID-19/coronavirus outbreak, by age and presence of children,16th-23rd April 2020
- Impact on key consumer segments
- Full-time workers are core cake users
- Number of children set to increase but benefit to market will depend on parents’ income
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- Figure 7: Frequency of eating slices of whole cakes, by age and presence of children in the household, December 2019
- Over-55s warrant greater attention
- How a COVID-19 recession will reshape the market
- 2008/09 recession saw own-label benefit
- Impact on the marketing mix
- Opportunities in dessert occasions
- Middle of the market will see increasing price competition
- Emphasising the inexpensive treat role of cakes could appeal
- Local bakeries may have earned long-term custom
- COVID-19: Market context
Executive Summary
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- Impact of COVID-19 on Cakes, Cake Bars and Sweet Baked Goods
- COVID-19 unlikely to have long-term negative impact
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- Figure 8: Forecast of UK retail value sales of cakes, cake bars and sweet baked goods (adjusted for COVID-19), 2014-24
- Figure 9: Expected impact of COVID-19 on cakes, cake bars and sweet baked goods, short, medium and long-term, 5 May 2020
- Income squeeze could see own-label resurgence
- Opportunities lie in targeting evening occasions
- The market
- 2019 sees modest growth continue for cakes, cake bars and sweet baked goods
- Small cakes continue to outperform, hot cross buns leap ahead in sweet baked goods
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- Figure 10: UK retail value sales of cakes, cake bars and sweet baked goods, by segment, 2017-19
- Category looks set to fail PHE sugar reduction and reformulation target
- Number of children set to rise but older consumers could prove a barrier
- Companies and brands
- Mr Kipling sees rebranding and product innovation pay off in cakes and cake bars
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- Figure 11: Leading brands’ sales and share in the UK retail cakes and cake bars market, by value, 2017/18-2018/19
- Warburton’s leads in brands but own-label remains dominant in sweet baked goods
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- Figure 12: Leading brand owners’ sales and share in the UK retail sweet baked goods market, by value, 2017/18-2018/19
- Spotlight on health stimulates more better-for-you variants, but these remain niche
- Own-label continues to push the boundaries in seasonal offerings
- Innovation responds to growth in plant-based movement
- Low adspend due to private-label dominance
- The consumer
- Cakes and sweet bakes are enjoyed almost universally
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- Figure 13: Frequency of eating cakes, cake bars and sweet baked goods, December 2019
- Dessert and evening snacks offer category potential new eating occasions
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- Figure 14: Reasons for buying cakes, cake bars and sweet baked goods, December 2019
- More convenient formats could do well
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- Figure 15: Factors considered important to have in a perfect cake, cake bar or sweet baked good, December 2019
- Creating a local bakery feel could win favour with consumers
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- Figure 16: Cakes, cake bars and sweet baked goods eating and buying behaviours, December 2019
- What we think
Issues and Insights
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- New snacking occasions create opportunities for category
- The facts
- The implications
- Healthier variants hold potential for keeping cakes and sweet baked goods on consumers’ menus
- The facts
- The implications
- Providing the special feeling of a bakery will chime with consumers
- The facts
- The implications
The Market – What You Need to Know
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- 2019 sees modest growth continue for cakes, cake bars and sweet baked goods
- COVID-19 will have short term negative impact on cakes, cake bars and sweet baked goods
- Cakes, cake bars and sweet baked goods expected to return to growth in 2021
- Pre-COVID-19 forecast predicts market would have seen slight growth
- Small cakes continue to outperform
- Hot cross buns leap ahead in sweet baked goods
- Category looks set to fail PHE sugar reduction and reformulation target
- COVID-19 sees uplift in baking and lost eating occasions
- Number of children set to rise but older consumers could prove a barrier
Market Size and Forecast
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- 2019 sees modest growth continue for cakes, cake bars and sweet baked goods
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- Figure 17: UK retail value sales of cakes, cake bars and sweet baked goods, 2014-19
- Outlook in light of COVID-19
- COVID-19 will have short term negative impact on cakes, cake bars and sweet baked goods
- Cakes, cake bars and sweet baked goods likely to recover in 2021
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- Figure 18: UK retail value sales of cakes, cake bars and sweet baked goods (adjusted for COVID-19), 2014-24
- Figure 19: Forecast of UK retail value sales of cakes, cake bars and sweet baked goods (adjusted for COVID-19), 2014-24
- Pre-COVID-19 forecast predicts market would have seen slight growth
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- Figure 20: UK retail value sales of cakes, cake bars and sweet baked goods (pre-COVID-19 forecast), 2014-24
- Figure 21: Forecast of UK retail value sales of cakes, cake bars and sweet baked goods (pre-COVID-19 forecast), 2014-24
- Forecast methodology
Market Segmentation
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- Small cakes continue to outperform
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- Figure 22: UK retail value sales of cakes, cake bars and sweet baked goods, by segment, 2017-19
- Hot cross buns leap ahead in sweet baked goods
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- Figure 23: UK retail sales of prepacked sweet baked goods, by type, 2017-19
Market Drivers
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- Category looks set to fail PHE sugar reduction and reformulation target
- Minor progress as cakes and morning goods begin to reformulate
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- Figure 24: Percentage of sugar reduction achieved across selected categories within PHE’s sugar reduction and reformulation programme, 2015-18*
- Most consumers are limiting sugar
- Home baking will have greater impact on market due to COVID-19
- Two in three people bake at home
- COVID-19 sees uplift in baking
- Number of children set to rise but older consumers could prove a barrier
- Parents are core cake buyers
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- Figure 25: Frequency of eating slices of whole cakes, by age and presence of children in the household, December 2019
- Strong interest in better-for-you kids’ snacks
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- Figure 26: Trends in the age structure of the UK population, 2014-19 and 2019-24
Companies and Brands – What You Need to Know
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- Mr Kipling sees rebranding and product innovation pay off in cakes and cake bars
- Warburton’s leads in brands but own-label remains dominant in sweet baked goods
- Spotlight on health stimulates more better-for-you variants, but remain minority
- Retailers continue to push the boundaries in seasonal offerings
- Innovation responds to growth in plant-based movement
- Mr Kipling sees a wealth of launches in 2019
- Low adspend due to private-label dominance
Market Share
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- Mr Kipling sees rebranding and product innovation pay off in cakes and cake bars
- Cadbury outperforms own-label dominated market
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- Figure 27: Leading brands’ sales and share in the UK retail cakes and cake bars market, by value, 2016/17-2018/19
- Figure 28: Leading brand owners’ sales and share in the UK retail cakes and cake bars market, by value, 2016/17-2018/19
- Warburton’s leads in brands but own-label remains dominant in sweet baked goods
- Soreen boosted by advertising campaign
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- Figure 29: Leading brand owners’ sales and share in the UK retail sweet baked goods market, by value, 2016/17-2018/19
Launch Activity and Innovation
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- Spotlight on health stimulates more better-for-you variants
- Sugar and fibre claims remain rare
- Launches explore nutritious ingredients
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- Figure 30: Recent examples of healthy innovation within cakes and sweet baked goods, 2019
- Mr Kipling expands Reduced Sugar range
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- Figure 31: Mr Kipling Angel Slices with 30% less sugar, front of pack and snack packs, 2019
- Fibre One launches Red Velvet Cake Bar
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- Figure 32: Fibre One 90 calorie Red Velvet Cake Bars, 2019
- Own-label continues to lead in launch activity
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- Figure 33: New product launches in the UK cakes, pastries and sweet goods market, by top 10 companies (sorted by 2019), 2015-19
- Retailers continue to push the boundaries in seasonal offerings
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- Figure 34: Share of cakes, cake bars and sweet baked goods launches with a seasonal claim, 2015-19
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- Figure 35: Examples of flavour experimentation in seasonal baked goods, 2019
- Figure 36: Examples of Waitrose’s hot cross bun launches, 2019
- Innovation responds to growth in plant-based movement
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- Figure 37: Share of cakes, cake bars and sweet baked goods launches with a vegan/no-animal-ingredients claim, 2015-19
- Premier Foods moves into plant-based snacking
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- Figure 38: Plantastic Orange & Parsnip Cake with Pecans, front of pack and back of pack detail, 2019
- Oggs brings eggless cakes to the mainstream market
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- Figure 39: Oggs zesty lemon cakes front of pack and back of pack detail, 2019
- Bells & Whistles cake slices look to combine health and indulgence
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- Figure 40: Examples of Bells & Whistles cake slice range, 2019
- Vegan versions of traditionally un-vegan products appear
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- Figure 41: Further examples of vegan launches in the cakes, cake bars and sweet baked goods category, 2020
- Figure 42: Vegan examples of seasonal sweet baked goods, 2019
- Mr Kipling sees a wealth of launches in 2019
- Signature Collection targets premium end of market
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- Figure 43: Mr Kipling Signature Collection Apple, Pear & Custard Crumble Tarts front packaging and back detail, 2019
- After-dinner cakes expand into traditional dessert territory
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- Figure 44: Mr Kipling Signature Collection After dinner Mint Fancies front of pack and back detail, 2019
- Mr Kipling goes mini
- Own-brand and Baileys amp up indulgence
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- Figure 45: Recent examples of premiumisation and indulgence from retailers and brands, 2019
- Issue of waste within industry spurs on action
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- Figure 46: Recent examples of a product using surplus bakery products, 2020
- Baking celebrity ranges experience mixed fortunes
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- Figure 47: Mary Berry Celebration Rose Cake with piping tube to personalise, 2019
Advertising and Marketing Activity
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- Low adspend due to private-label dominance
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- Figure 48: Total above-the-line, online display and direct mail advertising expenditure on cakes, cake bars and sweet baked goods, 2019 and Q1 2020
- Soreen launches “Deliciously Squidgy Adventures” campaign
- Aldi celebrates award win with hot cross bun advert…
- …and M&S claims new variants are “not just hot cross buns”
- Mr Kipling launches second range of Roald Dahl products with on-pack competition
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- Figure 49: Examples of the Mr Kipling Roald Dahl and Core ranges featuring the on-pack competition, 2019
- Nielsen Ad Intel coverage
The Consumer – What You Need to Know
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- Cakes and sweet bakes are enjoyed almost universally
- Over half of consumers buy these products to treat themselves
- Potential for sweet baked goods to play more of a dessert role
- Cakes and sweet baked goods could take advantage of evening snacking occasions
- Taste leads among choice factors by a distance
- More convenient formats could do well
- Creating a local bakery feel could win favour with consumers
- Nearly three quarters believe cakes can be healthy and delicious
Usage of Cakes, Cake Bars and Sweet Baked Goods
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- Cakes and sweet bakes are enjoyed almost universally
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- Figure 50: Frequency of eating cakes, cake bars and sweet baked goods, December 2019
- Under-35s and parents are core users
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- Figure 51: Frequency of eating slices of whole cakes, by age and presence of children in the household, December 2019
- Sweet baked goods and individual cakes enjoyed the most frequently
Where People Buy Cakes, Cake Bars and Sweet Baked Goods
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- Supermarkets are top location for purchases
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- Figure 52: Location of purchase of cakes, cake bars and sweet baked goods, December 2019
Reasons for Buying Cakes, Cake Bars and Sweet Baked Goods
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- Over half of consumers buy these products to treat themselves
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- Figure 53: Reasons for buying cakes, cake bars and sweet baked goods, December 2019
- Opportunities for cakes for adults
- Inspiration from chocolate and ice cream
- Potential for sweet baked goods to play more of a dessert role
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- Figure 54: McVitie’s Jamaica Ginger Sticky Pudding cake with a hot or cold serving suggestion, 2016
- Cakes and sweet baked goods could take advantage of evening snacking occasions
- Indulgence and sweet flavours gain importance in snacks in the evening
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- Figure 55: Sainsbury’s Taste the Difference Triple Berry Hot Cross Buns emphasising sweetness of individual elements, 2020
- Figure 56: Genius Gluten Free Apple Pies emphasising sweetness of individual elements, 2020
- Injecting fun to cakes with packaging and language
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- Figure 57: Recent example of fun, bold packaging design from Oggs, 2020
- Figure 58: Nestlé Quality Street Matchmakers Chocolates with an on-pack game, 2016
Choice Factors of Cakes, Cake Bars and Sweet Baked Goods
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- Taste leads choice factors by a distance
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- Figure 59: Choice factors of cakes, cake bars and sweet baked goods, December 2019
- Convenience and healthiness are more important for frequent eaters
Factors Important for a Perfect Cake, Cake Bar or Sweet Baked Good
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- Demand for convenience offers opportunities for new formats
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- Figure 60: Factors considered important to have in a perfect cake, cake bar or sweet baked good, December 2019
- Cake bars are well-established baked good that can boost convenience
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- Figure 61: Recent international examples of convenient formats of sweet baked goods, 2019
- Less sweet cakes could help sugar reduction efforts
- Scope to call out ‘less sweet’ proposition
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- Figure 62: Recent examples of products claiming to be “not too sweet”, 2020
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- Figure 63: Willie’s Cacao Pistachio & Date Bar stating not needing sugar due to fruit content, 2019
- Opportunities to reduce sugar without sweeteners
Behaviours Related to Cakes, Cake Bars and Sweet Baked Goods
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- Products bought from bakeries are seen as special
- Four in five see bakery treats as special
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- Figure 64: Cakes, cake bars and sweet baked goods eating and buying behaviours, December 2019
- More scope to call out artisan credentials
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- Figure 65: Waitrose Easter Spiced Panettone calling out a traditional family recipe, 2019
- Figure 66: Popty Bakery Traditional Welsh Cakes regional brand emphasising the story behind the product, 2019
- Retailers would do well to stock locally produced baked goods
- Leading grocers support local suppliers
- COVID-19 puts the spotlight on helping the local community
- Nearly three quarters believe cakes can be healthy and delicious
- Strong conviction that healthiness and taste can go together
- Reducing sugar remains needed
- Scope to explore better-for-you additions
- Two thirds are open to more international cakes and baked goods
- In-store bakeries’ flexibility facilitates new variants
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Consumer research methodology
Appendix - Launch Activity and Innovation
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- Figure 67: Share of new product launches in the UK cakes, cake bars and sweet baked goods market, by top 30 claims, 2015-19 (sorted by 2019)
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Appendix – Market Size and Forecast
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- Forecast methodology
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- Figure 68: UK retail value sales of cakes, cake Bars and sweet baked goods, best- and worst-case forecast (pre COVID-19), 2019-24
Appendix – Market Share
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- Figure 69: Leading brand owners’ sales and share in the UK retail sweet baked goods market, by value, 2016/17-2018/19
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