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Biscuits move Breakfast in New Directions, or Vice Versa?

Nutritionists frequently refer to breakfast as the most important meal of the day, citing studies that find that people who skip breakfast are disproportionately likely to have problems with concentration, metabolism and weight.  Even so, there are large numbers of people who still skip breakfast on a regular or occasional basis, most often citing lack […]

Nutritionists frequently refer to breakfast as the most important meal of the day, citing studies that find that people who skip breakfast are disproportionately likely to have problems with concentration, metabolism and weight.  Even so, there are large numbers of people who still skip breakfast on a regular or occasional basis, most often citing lack of time or lack of appetite.   This perceived lack of time has been crucial in the rising interest in breakfast ‘on-the-go’ options and has driven the development of new product types and formats to cater to this demand, with breakfast biscuits one of the most high-profile recent successes in a number of non-traditional markets.

While biscuit consumption at breakfast time is relatively commonplace in some parts of the world, most notably European markets such as France, Spain and Italy, it has only relatively recently become an area of much interest in other countries, including major biscuit markets such as the US, the UK and Germany, where cereal bars were previously really the closest alternative marketed as on-the-go breakfast options.  Furthermore, interest in the market over the past few years was really kick-started by just one company and brand, with Kraft (now Mondelez) launching and heavily promoting its Belvita brand as a breakfast biscuit in a number of key countries.

In France, the breakfast biscuits market is relatively well established, with sales of over EUR 100m a year, equivalent to about 7.5% of the EUR1.5bn sweet biscuits market.  Research by Mondelez at the time of Belvita’s launch in the UK reported that one in five French consumers already ate biscuits for breakfast.  The Belvita brand has been sold in France under the Lu Petit Dejeuner name for over 10 years and dominated the breakfast biscuits market with a share of over 60%.  The Belvita name was first introduced in France in 2009 as a healthy biscuit line, replacing the Taillefine healthy biscuit brand, licensed by Kraft from Danone for a limited period. With its success elsewhere in Europe, the Belvita name was moved into the breakfast market when Lu Petit Dejeuner was renamed Lu Belvita Petit Dejeuner in 2012.

The consumption of biscuits at breakfast time is also very well established in Spain and Italy, where breakfast biscuits make up 25% of the market by value.  In Spain, the share of breakfast lines rises to over 45% of the sweet biscuits market by volume, reflecting relatively low unit pricing in comparison with other sectors such as specialities and assortments. The market is so established that it has segmented into everyday, healthy and children’s breakfast biscuit options, with everyday products alone accounting for about one fifth of total sweet biscuit sales, ahead of healthy options with over 15% and children’s lines with about 10%.

While Mondelez introduced its first breakfast biscuits in France over 10 years ago, its recent focus has been on developing the Belvita brand in new markets and it is now sold in over a dozen countries, including the UK and Germany in Western Europe, Hungary and Poland in Eastern Europe, the US, Brazil and Australia.

This period of strong activity for the Belvita brand started in Europe with its UK launch in January 2010, featuring wholegrain biscuits positioned specifically for the breakfast market, promoted as rich in cereals, vitamins and fibre, with slow carbohydrate release for sustained energy.  The range has gradually been extended with a number of new flavors and formats, with brand sales reaching about GBP50m a year by the end of 2012, making it the number five sweet biscuit brand in the UK in 2012, and the leader in healthy biscuits.

Germany, another market where biscuits are not traditionally a breakfast option, has also seen the arrival of Belvita, with the introduction of Belvita Frühstückskeks in three variants in April 2012, since extended with an additional flavor. The products were marketed as containing five whole grain cereals to provide a healthy, modern and convenient breakfast option.

Over the Atlantic, Belvita has also been launched in the US under the market leading Nabisco biscuits umbrella, where it also has had to pioneer a new sweet biscuits sector in the breakfast foods market or a breakfast option in the cookies market, depending on how you look at it.  The initial 2012 national launch was of typical US flavors Blueberry, Golden Oat and Apple Cinnamon, since joined by Cinnamon Brown Sugar and Chocolate variants.  These were marketed as lightly sweet, whole grain crunchy breakfast biscuits specially developed to provide nutritious sustained energy as fuel for the whole morning.  More recently, a new Belvita Soft Baked range in has been introduced to cater for the traditional US love of soft cookies.  The brand was also launched in Australia in early 2012, where research showed that one in ten households tried the product in its first three months on the market.  It now has a five-strong range, including a recently introduced Cranberry variant.

Meanwhile back in the UK, the success of the Belvita brand in creating and driving a new market sector did not go unnoticed, with Innova Market Insights recording the fairly rapid entry of a range of other bakery and breakfast food companies.  2012 saw the arrival of a range of competitors from major companies such as cereals market leaders Kellogg, Weetabix and Quaker (PepsiCo), biscuits market leader UB’s McVitie’s and number two bread brand Hovis (Premier Foods), as well as retailer own brands.

Market penetration of breakfast biscuits more than doubled from 6% to over 12% in 2011, rising to nearer 17% by late 2012.   Within the rapid increase in sales, the market has already started to segment, with introductions in the second half of 2013 including calorie-controlled lines under the WeightWatchers brand, made in association with Walkers Shortbread, and infant options with Heinz Six Cereals Breakfast Biscotti.

As Belvita builds a presence in such a large number of new markets, it is increasingly going to face the type of competition already appearing in the UK, although it is too early to say how effective this competition may be.  Despite some adverse publicity about health aspects of breakfast biscuits and claims that they may not make a particularly good start to the day, the products have become the biggest thing in UK biscuits for years and this could spread to other countries.

The sector does seem open to considerable further growth, reflecting ongoing initiatives focused on the demand for convenient items for on-the-go breakfasts as sales of traditional breakfast cereals continue to see static to falling sales in a number of their traditional strongholds, including the US, the UK and Australia. Cereal bars and snacks have been penetrating the convenient breakfast market for some years and gained credibility, so perhaps it is now a relatively small step for sweet biscuits, particularly if backed up by the current high levels of product and promotional activity.