Value-conscious Germans can be targeted with decadent bakery & cereals products
26 August 2015
While the German economy is growing, value-conscious German consumers are still on the lookout for the best deals in bakery & cereals. To avoid price wars and encourage consumers to trade-up, manufacturers need to more effectively meet consumers’ desire to treat themselves.
According to a new report from Canadean, Germany’s bakery & cereals market – with a volume of 6.4 billion kilos and a value of USD 25.9 billion in 2014 – is forecast to register a CAGR of 1.1% between 2014 and 2019 by volume, and a lower CAGR of -0.5% by value. Despite Germany’s economy being considered stable, value-conscious German consumers are still vastly driven by the desire for best value, which is motivating a fifth (19.8%) of bakery & cereals consumption. “More consumers have turned to retailers such as ALDI and LIDL in the search for value, leaving more premium brands with a challenge to justify higher prices to consumers,” says Veronika Zhupanova, analyst at Canadean.
Indulgence is the reason to trade-up
To avoid a race to the bottom, manufacturers need to justify the price – and they can do this by appealing to the motivator that is more important than price to Germans – the desire to treat themselves. Almost a third of bakery & cereals consumption are motivated by superior taste sensations (31.9%), reflecting how German consumers consider indulgence to be worth trading-up for. This is especially true for cookies, where this desire motivates 40.6% of consumption, as well as for cakes, pastries & sweet pies (36.8%) and savoury biscuits (34.9%). Zhupanova adds: “As consumers prioritise taste above all, manufacturers can target them with decadent flavour combinations, such as breakfast cereals with dark chocolate, sweet pomegranate seeds and savoury nuts.”
Manufacturers should explore cross-promotion
According to the Canadean report, manufacturers should explore cross-promotion meal deals to maximise taste sensations for consumers, such as offering breakfast cereals with flavoured milk, or spicy and hot pastries paired with a sweet carbonated chilled drink, or matching savoury biscuits with certain types of cheese and wine. Zhupanova adds: “Such deals not only make the product more indulgent, but will also help consumers to save costs.”
Germans are value-conscious when it comes to bakery& cereal products.
All numbers used in this text are based on Canadean's report: 'Consumer and Market Insights: Bakery & Cereals Market in Germany.'
Please get in contact if you have any questions to this or other Canadean reports. Analysts are available to comment. Contact the Canadean press office on +44 (0) 207 936 6536 or email email@example.com.