Shoppers are giving a lot more love to their local store’s grocery aisles.
By Gaelle Walker
Often consigned to the rear of stores and possessing slightly less of the sizzle and spark owned by other-more NPD-rich categories such as chilled and impulse, ambient grocery was once commonly (and mistakenly) thought of as convenience’s poor relation. However, the category enjoyed what can only be described as a Cinderella moment in 2020, when national lockdown restrictions prompted shoppers to fall head-over-heels and become amorous with ambient.
With the sudden rise in home-eating, certain categories, such as cooking sauces and packaged bread products, enjoyed meteoric success.
And good news is, that while sales in 2021/22 are understandably down on those stratospheric levels, for many retailers, they are still comfortably up on their pre-pandemic planes – driven by heightened shopper interest and appreciation.
With its value for money credentials, the current cost of living crisis is also helping to propel sales of typically longer-life, ambient grocery products.
Graham Watson of Watsons Grocers (Premier) in Moniaive explains: “We are a very rural store and some distance away from the nearest supermarket meaning that grocery has always been a good seller for us.
“However, its star rose exponentially during lockdown and despite falling back now that restrictions have eased, sales are still ahead of where they were. Tinned goods, dried pasta, cooking sauces and bread products are still very strong sellers for us. It’s down to a combination of factors: new-found shopper interest, a continued sense of caution especially among shoppers over the age of 60 who like to ensure their cupboards remain well stocked, and increasingly price.
“With the cost of living going up, many shoppers are also turning to the category as a way of controlling their spending. Sales of tinned fruit and vegetables for example are up. We’re also seeing stronger sales of dried goods from our in-store gravity dispensers which allow budget-conscious shoppers to buy the exact quantities that they need and not overspend.”
One category well worth noting with ambient grocery is prepacked bread which has witnessed high levels of innovation in recent months driven by shopper demand for more premium products and new varieties of bread “with bits”.
Despite being “in the firing line” regarding concerns over its healthiness, white bread remains the most popular type of prepacked bread sold, accounting for 50% of value sales and growing by 2% between 2019 and 2021 according to Mintel.
However, when it comes to growth, prepacked bread “with bits” i.e. nuts and seeds, is winning the race, with bread with bits racking up the fastest growth between 2019 and 2021 up by 5.7% according to Mintel.
The sub-category is proving to be a strong draw for shoppers on the lookout for bread with added nutritional benefits – a trend which was on the up even before the advent of the Covid-19 pandemic and has since escalated.
This growth, according to Mintel, appears to be at the expense of brown bread, which was down by 2.6% in 2021.
Bread with bits “clearly appeals to consumers on health and texture grounds,” Mintel says, with breadmakers continuing to look to seeded varieties through innovation.
‘Half and half’ bread like Hovis’ Best of Both, were also up 2.1% between 2019 and 2021.
Hovis’ Best of Both loaves were recently relaunched with a new Vitamin D-rich recipe, in line with growing shopper demand for food with more added nutrients, Hovis said.
Bread “with bits” also sits well within the growing shopper trend towards more premium packaged bread products, as Hovis’ Category Manager Helen Stares, explains.
“Sales of premium loaves are accounting for a greater share of pre-packaged bread loaves sold” she says.
As such, Hovis plans to launch a new Granary Cob as part of its Hovis Bakers Since 1886 range towards the end of April.
And, as the cost of living increases, Stares expects to wrapped bread take on a new level of importance for shoppers.
“For those who are particularly feeling the pinch, bread is a cost-effective way to fill the family and is versatile enough to be served for all meals: breakfast, lunch or dinner,” she says.
The gains made by the speciality bread and rolls market during the months of lockdown slowed in 2021 as shoppers returned to work – however, with a large proportion of UK shoppers still working from home part-time, the market is still well up on pre-pandemic levels as home workers continue to trade up and battle the so-called “lunchtime fatigue,” with new, more interesting breads and fillings.
In fact in 2021, 32% of at-home lunch eaters said their lunches included more premium food products than before the Covid-19 outbreak, according to Mintel.
Sales of rolls, the largest segment, were up 2.8% on their 2019 levels, with the market continuing to benefit from the ongoing premiumisation trend and the growing popularity of certain categories such as brioche buns and sourdough.
Wraps and bagels also continued to perform well up on 2019 levels in 2021, with sales of wraps up 16.2% and bagels up 12.7% as shoppers continued to sex up their sandwiches.
