Positive grains

More and more, consumers are interested in healthier options when shopping the supermarket cereal aisle. Created as the original health food about 150 years ago, cereal was the answer to eating fatty meats for breakfast. Today, as the obesity epidemic reaches catastrophic proportions, consumers are again looking for healthier breakfast—and snack—options. To meet the demand, many ready-to-eat cereal manufacturers are going back to their roots, developing healthier options for America’s most popular breakfast. Industry observers say that as the primary outlet in which consumers make their cereal purchases, supermarkets can continue to drive meaningful sales growth by leveraging these healthy product innovations, as well as other products in the category. “Retailers can accelerate growth by treating each cereal segment as its own category, focusing on key shoppers and the dynamics within each segment to drive sustainable balanced growth,” says Dave Jones, vice president industry initiatives for the Kellogg Co., based in Battle Creek, Mich. When it comes to the healthier cereal options available, it seems as if consumers are paying attention. According to a U.S. breakfast cereal report released in February by Chicago-based research firm Mintel, 73% of consumers surveyed are reading cereal boxes, and 67% are looking for high fiber and whole-grains. Consumers also say that “added-in” claims such as high fiber or high protein are more important to them than claims that pertain to fat and calorie content. Sales data supports what consumers said in the survey. According to the SymphonyIRI Group, a Chicago-based market research firm, for the 52 weeks ended Aug. 12, three of the top five selling branded cereals in terms of dollars at food, drug and mass outlets (excluding Walmart), were Honey Nut Cheerios, Honey Bunches of Oats and Cheerios, all of which could be considered some of the more healthy options on retailer shelves. Additionally, the far and away top growing cereal (up 18.1%) was Multi Grain Cheerios. To further the health message, General Mills, maker of the Cheerios brand, has launched a new advertising campaign intended to remind consumers about the healthy attributes of Cheerios. Maerenn Jepsen, spokesperson for Minneapolis-based General Mills, says the company’s lineup of healthy cereal does not end with Cheerios. “In 2012, General Mills reached a multi-year reformulation milestone across its portfolio of Big G cereals to ensure that every Big G cereal now has more whole grain than any other single ingredient,” she says. “Every General Mills Big G cereal now contains at least nine grams of whole grain per serving, and more than 20 General Mills cereals deliver at least 16 grams. And, many fortified cereals provide more iron, folic acid, zinc, B vitamins and fiber than conventional non-cereal breakfast choices. Many fortified cereals also add vitamin A, thiamin, niacin, calcium, phosphorous, magnesium and/or potassium.” New life for old grains This summer General Mills added Apple Cinnamon Chex, Fiber One Nutty Clusters and Almonds and Ancient Grains, an organic cereal that combines quinoa, spelt, Kamut, khorasan wheat and Cascadian Farm granola. Nature’s Path Organic Foods also offers an ancient grains product. Maria Emmer-Aanes, director of marketing and communications for the Richmond, B.C., Canada-based company, says its new Qi’a product, made with chia, hemp and buckwheat, is a “revolutionary, super food bowl buster and has seen instant popularity. Products high in fiber, protein chia, flax, quinoa are very popular right now. It seems consumers are looking for a healthy, tasty unique mix of new ideas.” Even with the plethora of new healthier options, a supermarket cereal aisle can often be difficult to shop, simply because of the sheer number of different brands, flavors and box sizes. To make it easier for shoppers to find fiber-rich heart-healthy cereals on retailer shelves, in February Kellogg’s began putting a front-of-pack label—a “Kellogg’s Heart Healthy Selection” logo—on nine of its varieties, including Kellogg Raisin Bran, All Bran, Smart Start and Kellogg FiberPlus. Kellogg’s also recently launched Raisin Bran Cinnamon Almond while the Special K brand re-launched Special K Protein in response to consumers looking for protein and energy to feel full longer, says Jones. Other recently launched items include Frosted Mini-Wheats Touch of Raspberry and Frosted Mini-Wheats Cinnamon Roll. At a time when private label sales continue to erode national brand sales, especially in the cereal category (SymphonyIRI reports private label cereal sales are up almost 7%, while all other manufacturers sales are down), Kellogg’s and General Mills continue to work closely with retailers to boost brand sales. Both cereal giants make efforts to provide retailers with category research and insights designed to identify growth opportunities and leverage shopper trends. “Cereal is driven by brand-building and innovation, which is effective, even in a difficult economic climate,” says Jones. “And its appeal cuts across all age groups, from Baby Boomers to those interested in health and wellness.” As Kellogg and General Mills continue to duke it out for cereal supremacy, smaller brands are looking to fill the gaps. One such brand is Grain Berry, made by Cresskill, N.J.-based Silver Palate Kitchens. The Grain Berry brand features grain-based products and includes ready-to-eat cereals as well as crackers, muffin mixes and pancake mixes. “We are not a cereal company,” says Bob Harris, Silver Palate chairman. “We have always been interested in nutrition, and we felt whole grains and natural anti-oxidants were an important concept that needed to be followed, so we did, with less sugar.” The four cereal SKUs in the Grain Berry line are Toasted Oats Regular, Honey Nut, Apple Cinnamon and Bran Flakes, with more expected to follow in the near future. With price-points a bit higher than many branded cereals, Harris says Grain Berry targets an older, slightly more educated consumer with products that he says can standout in the crowed cereal category. “Kellogg’s and General Mills do a wonderful job,” he says. “They don’t need us to duplicate what they do. We try to do something different and unique to justify being on the cereal shelf next to them.”