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A Walk Down the Aisle - Breakfast

Breakfast of Champions

September 13, 2012
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The breakfast aisle seems to offer consumers quite a bit of choices when it comes to private label these days. Read what else our secret shoppers found that can help you sell more PL breakfast items.
 
Hot cereal, and particularly cold cereal, are certainly top of mind among breakfast eaters, according to a report from Mintel International Group, Breakfast Cereals — US, February 2012. Mintel’s custom consumer research shows that breakfast cereal is the most likely option that consumers eat (84%). 
 
At an estimated $10.2 billion, total U.S. 2011 breakfast cereal sales essentially were unchanged (-0.2 percent) from 2010. However, this represents a noticeable improvement from 2009-10, in which this market posted a decline of 4.7 percent.
 
The report also notes that as society has become increasingly mobile, consumers often seek out portable and convenient foods, which is one of the strengths of breakfast and cereal bars. Total U.S. 2011 sales of the breakfast/cereal/snack bars segment essentially were unchanged with a nominal increase of 0.2 percent, reaching $1.5 billion in sales. Still, this represented an improvement over the previous three years, which posted declines.
 
PLBuyer sent three of its secret shoppers to check out the breakfast aisle of food retailers in Missouri, California and North Carolina in July, and asked them to evaluate how their local stores market and merchandise their private label breakfast items.
 
In addition to looking for in-store merchandising, shoppers recorded prices of comparable private label and national brand cold cereal, hot cereal, breakfast bars and maple syrup, and conducted their own taste tests.
 
The goal of our walks down the aisle is to provide our readers with market intelligence and insight you can use.
 

MARKETING VARIES

Private label marketing in the breakfast aisle continues to vary from retailer to retailer. Shopper Jordan B. reported that he didn’t see any in-store ads or signs for private label products, but there were shelf tags comparing private label prices with the national brand prices, and the private label products also were shelved directly next to similar national brand products.
 
Bill K. did not see any in-store ads or signs for private brand products in his store, but the in-store radio broadcast a commercial for the private label cereal at the very moment he was in the breakfast aisle.
 
Michael G. did not see any in-store ads or signs for private label products in this category. He also did not notice any shelf tags that compared private label prices with national brand prices. In this category, the private label products were shelved very close together with similar national brand products.
 
Most of the price gaps between the private brands and the national brands were fairly small, with a few notable exceptions.
 
The biggest price difference was a $2.70 difference between the Mrs. Butterworth’s syrup and the Kroger brand syrup at the Ralph’s in Los Angeles. However, the package size wasn’t noted.
 
Also at the Ralph’s, there was a $2 difference between the Kellogg’s Frosted Flakes cereal and the Kroger Sugar Flakes cereal, and a $2 difference between the Quaker oatmeal and the Ralph’s oatmeal. Again, package sizes were not noted.
 
At the Ingles in N.C., Honey Nut Cheerios were on sale for $3.18 and the private label Laura Lynn Tasteeos were on sale for 3 for $5, resulting in  a $1.51 price difference. Both boxes of cereal were 12.25 oz. At the same store, there was also a $1.24 difference between the Kellogg’s Nutrigrain bars and the Laura Lynn Fruit & Grain bars.
 
At the Marsh’s Sun Fresh Market in Kansas City, the biggest price difference was between the Quaker oatmeal, which cost $3.69 for an 11.8 oz. package, and the Best Choice oatmeal, which cost $2.19 for a 15.1 oz. package, resulting in a $1.50 price difference.
 

TASTE TESTS

Secret shopper Jordan B. tried the Ralph’s brand oatmeal and said that it was surprisingly good, and actually tasted a little bit better than the Quaker brand oatmeal.
 
“The texture was good and it tasted great,” he said.
 
Secret shopper Bill K. bought the Laura Lynn brand Tasteeos cold cereal. “The cereal seemed identical to the national brand (Cheerios) and could very well have been processed in the same factory,” he said.
 
Michael G., who normally buys items in this category at the nearby warehouse store, Costco, especially when it comes to breakfast bars and cereal, bought the Best Choice Fiber Max cereal bars.
 
“I found it very tasty, a generous portion and very satisfying,” he said. “It is an excellent value.”
 

OTHER OBSERVATIONS

One interesting observation from secret shopper Michael G. was that the private labels sometimes were in marginally different sizes/portions that were the national brands.
 
Shopper Jordan B. said he felt like there was quite a bit of variety for consumers to choose from in this particular category.
Bill K. noted that the private label packaging often closely mimicked the national brands. 
 
secret shopper breakfast ingles ralphs sun fresh market
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