Health boom drives cereal snacks, report

By Catherine Boal

- Last updated on GMT

On the back of growing demand for healthier snacking products,
cereal snacks are luring consumers away from traditional
indulgences such as crisps and confectionery - prompting snack
makers to diversify to keep up with the trend.

According to a new report by market analysts Leatherhead International, cereal bars in particular have been the driving force behind growing cereal snack sales which increased by 9.6 per cent last year.

The popularity of the bars can be attributed to their appeal as convenient, on-the-go foods along with their "healthy" image and frequent fortification with nutritional ingredients.

In 2005 cereal bars made up 70 per cent of total cereal snack sales in the US, Japan, Australia and Europe's five largest countries.

Sales from these countries amounted to $3.37bn (€2.67bn), of which cereal bars took $2.37bn (€1.88bn).

And growth seems set to continue with the researchers predicting a 7.2 per cent increase this year and a 2010 sales total of $3bn (€2.38bn).

In the face of this industry upturn, most new product development has chosen to focus on the healthy aspect of the trend.

The Leatherhead New Generation Snack Foods report states: "A key focus for NPD at present is that of healthier cereal bars including low and light products and those containing functional ingredients; a diverse range of ingredients is being used."

It continues: "Competitive advantage is crucial in this marketplace and recent launches suggest that the current means to this end is by the provision of healthier products."

Having successfully targeted children in the past, core consumers for such products are now health-conscious adults.

The trend for functional bars attracting nutritionally-aware consumers has made use of natural ingredients such as berries, nuts and so-called 'superfruits'.

Cholesterol-lowering ingredients, prebiotic fibres and antioxidant-rich additives have also proved popular with manufacturers.

Low calorie and low fat products remain popular with a strong emphasis on foods catered towards specific "fad" diets.

And, in terms of packaging, another important trend has been the demand for convenient on-the-move foods with bite-size snacking products.

According to Leatherhead, branding is particularly important in the sector with many well-known cereal companies, such as Kellogg, launching own-name branded bars.

Intense competition in the market from these bigger brands has led to the suppression of own-label products, with most activity originating from market leaders investing in brand extension.

Related topics: Health, Ingredients

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