Three of the largest drivers of this growth include the rising consumption of cakes and pastries, growing popularity of functional baking ingredients and an increase in in-store supermarket bakery sections.
“The numerous health benefits of gluten-free bakery products have increased their popularity in the Americas and Europe. Vendors have gradually begun to split their focus on health and indulgence cakes and pastries in Western Europe and North America. High-fiber bakery products are witnessing robust retail sales in Latin America and Asia-Pacific,” Manjunath Reddy, a lead analyst at Technavio for food research, said in the report.
Consumers are indulging more in premium baked goods
While there is a growing health-conscious attitude among consumers, many are still choosing to indulge without comprising quality of ingredients and are seeking out on-the-go baked good formats. Manufacturers throughout Europe and North America are increasingly splitting their focus between healthy and indulgent food.
Technavio found that the sales of chocolate-based cakes increased by 17% between 2007 and 2012, and that consumption of these products is usually unaffected despite challenging economic times.
Rise in functional ingredients, especially organic
Consumers are progressively turning to bakery products that suit specific dietary needs and preferences, such as gluten-free, kosher, organic ingredients, and products containing flour other than wheat (e.g. rice flour and chia flour).
Technavio cited the “organic” being the most common claim among baked goods, mainly due to the healthier and safer perception organic products tend to have with consumers who are willing to pay a higher price.
The introduction of these functional ingredients along with a willingness by many consumers to pay more, has allowed for a large amount of innovation within the category among small and large baked goods manufacturers.
Consumers turn to in-store supermarket bakeries for quality and price
Artisanal and industrial bakeries are still competing with in-store supermarkets’ range of fresh-baked products that include increasing amounts of baked goods with functional and healthy ingredients, such as whole grain and rice flour for competitive prices.
In-store bakeries are gaining prominence due to their lower prices and the convenience of one-stop shopping. Value-conscious customers are increasingly opting for private-label offerings of supermarkets.
Over the last few years, partially-baked or pre-baked or bake-off products have become more popular with consumers.
“Par bakery items are frozen to increase their shelf life, while the lower temperature also retains the texture of crumbs and reduces the rate of crumb hardening that results from staling. These cakes also provide an easy and fast way to offer consumers fresh bread and rolls,” Manjunath said.