FMI Forecast: Expect the Unexpected in Bakery Flavors

New flavors, textures, and ingredients will be explored to boost bakery evolution in 2020. Manufacturers are likely to be more original in their sustainable practices to cut down on food waste and plastic packaging that causes environmental damage, Nandini Roy Choudhury, senior research consultant working with Future Market Insights (FMI).

However, as consumers look for innovative tastes, manufacturers are introducing unique and unusual flavors to stand out in the stiff competition. Infused/blended flavors including apricot & ginger with chia seeds, lime & courgette with coconut, and chocolate & beetroot with cocoa nibs, that have a mix of both nutrition and taste will work well, the research company tells us. Floral flavors are also witnessing high consumer traction in the current market scenario. An all-time favorite, coffee flavors including cappuccino, espresso, and mocha are bound to remain among consumer’s favorites.

Increasing awareness and consciousness about health and wellness, especially among millennials, is contributing to the demand for healthy ingredients in bakery products. Some of the promising grain categories to look for in the coming two-three years include whole wheat, specialty grain, multi-grain breads, multi-seed bread, and rye breads. Thin versions of cookies and baked goods stuffed with fillings are expected to remain at the forefront in the texture category.

Single-serve Items

As food waste is a major concern of our days, single-serve goods can be part of the solution. Manufacturers need to be more ingenious in their sustainable practices to minimize food wastage and plastic packaging that are responsible for environmental damage. Product and convenience innovation is anticipated to gain traction with consumers for on-the-go bakery products in the future.

Single-serve items packaged for convenience appeal to consumers wanting to snack them over between meals or breakfast. Artisan and craft products along with products outfitting health-conscious consumers are expected to gain ground in sales, especially those focused on sugar-free, gluten-free, and keto-friendly. Despite rising healthy eating habits, when it comes to indulging, consumers find a way to reward themselves occasionally and single-serving products are perfect for such moments. Emphasizing this dynamic, packaging sizes are vital for driving sales for individually packaged products compared with larger pack sizes.

Another debate affecting both producers and customers is food waste. 25% of bread products in developed countries are wasted at consumer and retail level, during storage and processing. Food loss, resource wastage, and energy consumption often question the credibility of the industry. Manufacturers try to take up initiatives to bridge the gap between production and consumption. Reducing plastic, smarter utilization of natural resources, carbon footprint, reduction in carbon emission, and others are some initiatives manufacturers should adopt to optimize output levels.

Anticipated Shifts in Bakery

Global influences are influencing bakery product development and holistic health, convenience, sustainability, and innovations are trends that are expected to reshape the bakery industry in the foreseeable future. Consumers prefer fresh and healthier bakery products that claim to be either fortified or have more nutritional content. Gluten-free, non-GMO, low-fat, low-calorie, dairy-free are some of the most important claims.

According to the research company, fresh bakery counters, in-store bakeries, and artisanal bakeries are expected to enjoy growth in the industry next year. Consumers are demanding higher quality fresh products, and are thus, not preferring frozen and packaged baked goods as they find fresh goods healthier. Furthermore, fresh bakery stores and artisanal bakeries continue to grow in popularity as consumers are looking for a more personalized taste and new ingredient experience. This is leading fresh baked goods to take over frozen and packaged goods next year. Yet, frozen baked goods are expected to hold momentum owing to increasing product launches by key market players and their great convenience factor.

When it comes to product presentation, the analysts point out that now is the time of modern-day smart consumers, those who make decisions based on the trust of their consumer peers and not on marketing. Present-day smart consumers are looking for a premium experience in their products; be it taste or presentation, consumers want perfection. Innovative, convenient, and sustainable packaging, strong label game, vibrant colors, exotic flavors, fortified-enriched ingredients, are expected to attract consumer’s attention.

Premiumization

The concept of premiumization is persuading the bakery industry at large, ranging beyond pricing to include high-quality products and promise superior experience. Premiumization has fueled consumer perception for high quality and value-added products with the right quality ingredients that promise improved health benefits. Consumers are willing to pay a premium price for products offering obvious health benefits – the only prerequisite being the promise of a unique offering that meets their basic dietary and health needs of consumers along with sensory indulgence.

Baked goods are big business and make up about 8% of the total food & beverage sales across the store in the US. Different age groups have subtle differences by segment. Brand awareness, pricing, and availability are the main factors that drive consumers’ purchasing decisions. Millennials prefer store-based goods, whereas baby boomers want fresh bakery; generation Z demands cookies and crackers, and so on. Baked goods currently fall under the index of young households. The spending varies from product to product and category to category, from domestic brands to international brands. Key players operating in the market have a good understanding of consumer sentiments and eating habits and thus target a specific audience to launch their product offering.  Price competition is probable to gain additional relevance in the case of packaged bread, dessert mixes, and packaged cakes in most grocery retailers, which are required to offer lower-priced products to their customers to maintain stable volume demand.

Vegans and Vegetarian Products

Vegan, clean label, plant-based are added-value claims that remain at the forefront. Upper-end health-conscious consumers are expected to drive the growth of the market. Plant-based and vegan claims are perceived as healthy and premium among consumers. Flexitarians are responsible for uplifting plant-based and vegan goods market to a larger extent. Vegan and plant-based bakery goods are trending in developed economies. However, regions like the Asia Pacific and the Middle East are still to accept the concept of plant-based products.

In the food and beverage industry, trust and transparency have become major challenges, as there aren’t any strict regulations and guidelines laid down by governments regarding clean labeling. Companies have started using clean labeling as a catchword for promotional and marketing purposes, and have taken advantage of this to sell their products as clean-label products. It is essential for manufacturers to adopt cleaner practices to sell their food products including baked goods without alienating the trust of consumers. Clean label is gaining the eye of modern-day consumers as it is presently implies the idea of deep-rooted transparency.

Some novel developments that can constitute market opportunities next year include:

• The development of enzymes and leavening agents to improve workability and flowability of bread.
• Floral flavors, especially orange blossom, and hibiscus – to find market traction.
• The combination of sweet and savory flavors to witness booming demand.
• Bakery mixes and premixes to provide greater convenience to consumers.
• Single-serve packs to find consumer traction.
• Specialty grain to gain the eye of buyers.
• Bakery-fortification to trend in 2020.
• Ancient grains include amaranth, buckwheat, quinoa, millet, teff, sorghum, and wild rice to gain momentum.