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Cakes and Cake Bars - UK - March 2017

OVERVIEW
What you need to know
Products covered in this Report
EXECUTIVE SUMMARY
The market
Cakes post value growth despite war on sugar
Figure 1: Forecast of UK retail value sales of cakes and cake bars, 2011-21
Small cakes dominate, celebration cakes grow
Figure 2: UK retail value sales of cakes and cake bars, by segment, 2015 and 2016
Pressures for sugar reduction mount
Home baking remains popular
Brexit spells end of deflation and growing real consumer incomes
Companies and brands
Own-label grows market share
Figure 3: Leading brands’ shares in the UK cakes and cake bars market, by value, 2014/15 and 2015/16
NPD targets bites and on-the-go
Adspend dips in 2016
The consumer
Cakes remain a popular, but rare, treat
Figure 4: Frequency of eating cakes/cake bars, by cake type, December 2016
Self-treating fuels cake purchases
Figure 5: Reasons for buying cakes and cake bars, December 2016
Sizeable interest in low-sugar cakes
Figure 6: Factors that would encourage increased usage of cakes/cake bars, December 2016
Taste trumps healthiness for most
Figure 7: Attitudes towards cakes and cake bars, December 2016
Cakes enjoy a positive image
Figure 8: Correspondence analysis of qualities associated with different types of sweet treats, December 2016
What we think
ISSUES AND INSIGHTS
Taste trumps healthiness for most cake users, marked openness to portion control
The facts
The implications
Scope for cakes to harness ‘positive nutrition’ given interest from users
The facts
The implications
Self-treating fuels cake purchases but is rarely seen in marketing
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Value growth despite war on sugar
Inflation expected to support value sales
Small cakes segment continues to dominate
Celebration cakes see strong growth
Sugar remains in the spotlight
Brexit spells end of deflation and growing real consumer incomes
MARKET SIZE, FORECAST AND SEGMENTATION
Value growth despite war on sugar
Figure 9: UK retail value sales of cakes and cake bars, 2011-21
Inflation expected to support value sales
Figure 10: Forecast of UK retail value sales of cakes and cake bars, 2011-21
Forecast methodology
Small cakes segment continues to dominate
Celebration cakes see strongest growth
Figure 11: UK retail value sales of cakes and cake bars, by segment, 2015 and 2016
MARKET DRIVERS
Sugar remains in the spotlight
The Childhood Obesity Strategy sets sugar reduction targets
Low-sugar cakes remain rare
High openness to smaller packs
Gluten-free continues to grow
Raw ingredients hope to bolster health perceptions
Home baking remains popular
Appeal of cake decorating
Figure 12: Frequency of baking cakes at home, December 2016
Cakes face steep competition from other sweet treats
An ageing population unlikely to benefit cake sales
Brexit spells end of deflation and growing real consumer incomes
Cost pressures prompt price rises
Household incomes set to be squeezed
COMPANIES AND BRANDS – WHAT YOU NEED TO KNOW
Own-label grows market share
Premier Foods sees mixed results
Snacking formats support growth for Thorntons and Soreen
Private label continues to lead NPD
NPD targets bites and on-the-go
Adspend dips in 2016
MARKET SHARE
Own-label grows market share
Figure 13: Leading brands’ sales and shares in the UK cakes and cake bars market, by value, 2014/15 and 2015/16
Premier Foods sees mixed results
McVitie’s sales fall
Snacking formats support growth for Thorntons and Soreen
LAUNCH ACTIVITY AND INNOVATION
Private label continues to lead NPD
Figure 14: Share of new product launches in the UK cakes, pastries and sweet baked goods market*, by company (sorted by 2016), 2012-16
Premier Foods extends Cadbury Cake brand to appeal to young
Coco Pops launches Coco Bakes
Cake bites trend continues
Cake bites cater to health concerns and sharing occasions
Soreen, McVitie’s and Premier among recent bite-size NPD
Brands look to the on-the-go and impulse markets
Mr Kipling and Mini Rolls launch in twin packs
McVitie’s and Soreen look to on-the-go
Seasonal activity remains high
Cakes “fit for the Queen”
ADVERTISING AND MARKETING ACTIVITY
Adspend dips in 2016
Figure 15: Total above-the-line, online display and direct mail advertising expenditure on cakes and cake bars, 2013-16
Premier Foods unveils new campaign for Mr Kipling, supports Mini Rolls
New campaign for Mr Kipling
Mr Kipling partakes in ITV’s 'Queen's 90th Birthday Ad Break'
Summer campaign for Cadbury Mini Rolls
An ‘Absolutely Fabulous’ partnership for Cadbury Amaze Bites
Figure 16: Total above-the-line, online display and direct mail advertising expenditure on cakes and cake bars, by top 8 advertisers (sorted by 2016), 2013-16
Mondelēz and Kellogg's support kids’ ranges
New TV advertising push for Soreen Lunchbox Loaves
Nielsen Ad Intel coverage
THE CONSUMER – WHAT YOU NEED TO KNOW
Cakes remain a popular, but rare, treat
Single-portion cakes are top choice
Self-treating is top reason for cake purchases
Cakes are widely chosen as a snack
Sizeable interest in low-sugar cakes
‘Positive nutrition’ can resonate in cakes
Taste trumps healthiness for most, openness to smaller portions
Cakes enjoy a positive image
USAGE OF CAKES AND CAKE BARS
Cakes remain a popular, but rare, treat
Figure 17: Frequency of eating cakes/cake bars, by cake type, December 2016
Single-portion and smaller cakes most popular
Cakes from in-store bakeries eaten by 57%
Figure 18: Frequency of eating cakes/cake bars baked in-store, December 2016
Under-35s and families are core user groups
Workplace “cake culture”
Figure 19: Usage of cakes/cake bars at least once a week, by type, by employment status, December 2016
REASONS FOR BUYING CAKES AND CAKE BARS
Self-treating fuels cake purchases
18% buy cakes for a mood boost
Figure 20: Reasons for buying cakes and cake bars, December 2016
40% buy cakes to snack on
‘Convenient’ snack factor should benefit individual cakes
Everyday occasions are key for cakes
FACTORS ENCOURAGING INCREASED USAGE OF CAKES AND CAKE BARS
Sizeable interest in low-sugar cakes
Figure 21: Factors that would encourage increased usage of cakes/cake bars, December 2016
Limited scope for sweeteners in cakes
Sugar alternatives enjoy a better-for-you image…
…but also come with challenges
Cakes with benefits appeal
‘Positive nutrition’ trend
Cakes offering nutrients appeal to one in five
ATTITUDES TOWARDS CAKES AND CAKE BARS
Taste trumps healthiness for the majority
Averseness to recipe changes poses a challenge to sugar reduction
Openness to “less but better”
Figure 22: Attitudes towards cakes and cake bars, December 2016
Breakfast cakes appeal to many
Breakfast cakes would appeal widely
Soreen is among rare UK examples
Seasonal cakes attract interest
In-store personalisation a good fit for seasonal flavours
QUALITIES ASSOCIATED WITH TYPES OF SWEET TREATS
Cakes enjoy a positive image
Figure 23: Correspondence analysis of qualities associated with different types of sweet treats, December 2016
Whole/large cakes: good for sharing but not convenient
Only 26% view individual cakes as an everyday treat
Figure 24: Qualities associated with different types of sweet treats, December 2016
Methodology
APPENDIX – DATA SOURCES, ABBREVIATIONS AND SUPPORTING INFORMATION
Abbreviations
Consumer research methodology
APPENDIX – MARKET SIZE AND FORECAST
Forecast methodology
Figure 25: Total UK retail value sales of cakes and cake bars, best- and worst-case forecast, 2016-21
APPENDIX – MARKET SEGMENTATION
Figure 26: UK value retail sales of small cakes and cake bars, by sub-segment, 2015 and 2016
Figure 27: UK value retail sales of large cakes, by sub-segment, 2015 and 2016
APPENDIX – LAUNCH ACTIVITY AND INNOVATION
Figure 28: Selected claims’ share of new product launches in the UK cakes, pastries and sweet baked goods market*, 2012-16
Figure 29: Share of new product launches in the UK cakes, pastries and sweet baked goods market*, by launch type, 2012-16
Figure 30: Share of new product launches in the UK cakes, pastries and sweet baked goods market*, by brands and own-label, 2012-16

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