How the Global Bakery Industry is Being Shaped by Changing Consumer Preferences.
The growth outlook for the bakery industry is positive. However, market growth is driven by rapidly evolving consumer preferences. The companies that can balance the health concerns of their customers with expectations around indulgence—paradoxical as it may seem—are the ones most likely to capture growth in the market successfully.
Bakery industry outlook
The outlook for the bakery industry is generally positive, with the value of global sales expected to grow at a CAGR of 6% to reach $521 billion in 2020. Bread and biscuits remain the dominant categories, with cakes and pastries the fastest growing. Geographically, growth in the industry is driven by increased consumption in emerging and developing countries. In mature markets, demand for traditional bakery products or the staples is declining, while sales of “healthy” baked goods with natural and organic ingredients are growing.
Changing preferences are shaping the future
Among the key trends impacting the industry in recent times have been increased health consciousness among consumers and, paradoxically, growth in consumption of indulgence food. Many consumers view bakery products as unhealthy.
Yet this isn’t slowing consumption; instead it presents an opportunity to strike the right balance within the consumer’s perception. They prefer freshness, taste/flavour and price over health benefits. This indicates that despite the ever-increasing importance of health benefits, bakery products are at the pleasure end of the pleasure-sustenance spectrum in the minds of consumers. Companies will need to ensure that their products fit within that spectrum.
Influenced by rising health consciousness, demand for healthier and nutritional fortified bread has increased, and the fastest growing brands are those that specialise in innovative “healthy” bakery products, made from high-quality ingredients and that target demand for “free-from” and convenience food.
Staying on top of the game
Employing technical innovations that improve processes and help reduce costs can be just as important as tailored product innovations in the bakery industry. Companies must explore all bases from product to process innovations to ensure growth in sales and profits.
In the full report, we take an in-depth look at the bakery industry, examining the main factors driving growth in the market and providing our expert perspective on how companies can stay on top of the competition.