Wednesday, June 19, 2024
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Emerging Trends Changing India’s Breakfast Market

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In the kitchens across India, breakfast isn’t just a meal — it is a tradition. It is a time when the day begins with the comforting aroma of spices and the sizzle of hot pans. Breakfast isn’t just about filling the belly; it is about fueling the body for the challenges ahead.

In every corner of the country, from bustling cities to quiet villages, breakfast is a sacred affair. And even as the world has changed, some things have remained constant. Sure, there have arrived tempting options for eating out, but for many, nothing beats the warmth of a homemade meal.

From the crispy paranthas of the north to the fluffy idlis of the south, each region has its own culinary masterpiece. And while the world around them embraces new trends, many Indians hold on tight to their roots.

But times are changing, and so are tastes. With a growing focus on health and wellness, people are rethinking their morning rituals. Suddenly, the age-old recipes are getting a modern makeover. It is a new era of ‘healthifying’ breakfast, with families swapping out ingredients for healthier options.

Yet, amidst all the changes, one thing remains constant — the love for a hot, cooked breakfast. Whether it is the aroma of spices wafting through the air or the sound of sizzling pans, breakfast in India remains a celebration of tradition, taste, and togetherness. As the sun rises each morning, families gather around the table, ready to start the day the best way they know how — with a hearty breakfast and a whole lot of love.

According to Mintel research, almost 8 out of 10 Indian consumers eat breakfast more than once a week, which showcases that the first meal of the day has a strong following. “Breakfast is a meal that is most frequently consumed in the early morning before beginning the day’s work. Oats, muesli, cornflakes and other cereals, eggs, yoghurt, and RTEC (ready to eat cereals) breakfast items are all considered breakfast foods,” says Biyas Roy, Executive Director, Arambagh Foodmart, which runs a chain of over 80 food and grocery stores in West Bengal.  

The Changing Face of Breakfast in India

For generations, breakfast remained a simple affair — milk and fruit, steaming plates of poha or idli/dosa, and the comforting warmth of chapatis. For the most part, Indians are inclined to consuming their quintessential hot, cooked breakfast. Parantha remains a popular breakfast item in north, idli and dosa in south, flattened rice flakes (chivda/ poha) with milk in western and central India, whole wheat grits (dalia), and a mélange of regional staples in many other parts of India.

But now, a new wave is sweeping through the kitchen, challenging the old ways. Homemade idli batter and freshly rolled chapatis are steadily giving way to shiny packages of ready-to-cook batter and bowls of crunchy cereal. Even the humble poha is losing its spot to the trendy allure of multi-grain oats. So even as regional and ethnic breakfast eats have their followers, the need for convenience and health consciousness is driving many to replace traditional staples like atta, suji and poha with oats, millets and muesli.

In recent years especially, there has been a discernible rise in the popularity of packaged breakfast food within the market segment. This trend is particularly notable within urban centers, where the fast-paced nature of contemporary living, coupled with factors such as time constraints, heightened purchasing power, a demand for convenience, and an increased focus on health consciousness, have collectively propelled the adoption of ready-to-eat breakfast options.

Urban consumers, in particular, are gravitating towards the convenience and nutritional offerings provided by a variety of packaged hot and cold breakfast cereals. The market delineates between two primary categories: hot cereals, predominantly comprising oats, oat bran, and wheat bran, and ready-to-eat cold cereals, which encompass a range of options including corn flakes, wheat flakes, and muesli. This paradigm shift reflects a broader societal trend towards prioritizing efficiency and convenience in the context of breakfast consumption within modern urban lifestyles.

In terms of consumption patterns, breakfast cereals currently represent approximately 4% of the breakfast market share, while traditional breakfast items account for 16%. The remaining portion of the breakfast pie comprises selections such as bread, eggs, beverages, and various other options.

Market Size and Demand

The growth of the breakfast market can be attributed to several shifts in lifestyle dynamics.

  • With the traditional 9 to 5 work model evolving into a more flexible and dynamic arrangement, individuals are increasingly engaged in work throughout the day, necessitating a greater emphasis on convenience breakfast consumption. The appeal of breakfast foods that offer convenience and affordability aligns well with the preferences of millennials, who prioritize customization and value in their dietary choices.
  • The escalating pace of life in urban areas has fostered a heightened demand for swift and convenient breakfast options.
  • Furthermore, a surge in health consciousness among Indian consumers has played a pivotal role in the market’s expansion.

“The demand for breakfast food products is primarily propelled by value sales, owing to their widespread availability across diverse distribution channels, including supermarkets, hypermarkets, convenience stores, and departmental stores,” says Biyas Roy.

The entry of Kellogg’s into the Indian market during the 1990s marked a significant milestone, opening doors for both domestic and international players. Recent years have witnessed substantial growth in the Indian breakfast cereal market. Cereals, with their quick preparation and nutritional value, have become the preferred choice for busy urban professionals and students. With increased awareness of the importance of a nutritious breakfast, many cereal manufacturers have responded by offering healthier options with low sugar content, high fiber, and enriched with vitamins and minerals.

As per the findings of TechSci Research, the breakfast cereal market in India demonstrated a significant valuation of USD 4.64 billion in the year 2022. Projections indicate a trajectory of robust growth, with a compound annual growth rate (CAGR) of 7.95% from 2025 to 2029.

Additionally, there has been a notable surge in the demand for breakfast items such as oats, muesli, cornflakes, multigrain bread, eggs, and tofu. This uptick can be attributed to an increasing consumer awareness regarding the health benefits associated with the consumption of these products.

According to market research agency Euromonitor, consumers looking for weight loss, balanced intake of minerals and nutrients, along with a quick alternative to a traditional breakfast, will contribute to growth within breakfast cereals.

“A key driver fostering growth within the breakfast market is the escalating level of health consciousness among consumers. This trend is influenced by the growing prevalence of chronic lifestyle disorders, such as diabetes and obesity, prompting individuals to make more informed dietary choices,” notes Roy.

Commenting on the escalating demand for breakfast foods, Sameer Shaikh, Regional Head, Buying & Merchandising, bigbasket.com, offers insight into this prevailing trend. “The adage ‘Don’t leave the house on an empty stomach’ resonates with nearly all Indians, underscoring the cultural significance placed on breakfast consumption. As such, it is evident that the breakfast food category will continue to experience growth commensurate with the expanding population or, at the very least, maintain its current pace of growth. The category is witnessing significant expansion, which can largely be attributed to the preferences of Generation Z, Millennials, and Generation Alpha.”

Roy observes a significant surge in the consumption of ready-to-eat cereals, muesli, and oats in recent years, with accompanying growth in beverage, snack bar, and ready meal categories. Shaikh concurs, highlighting the notable expansion of the oats market across various food segments. This growth trend has notably propelled the hot cereals market, surpassing the growth rate of cold cereals.

Oats, in particular, have emerged as a compelling substitute for traditional staples such as rice and white flour products. While plain oats remain the most popular choice, there has been a proliferation of flavored varieties, catering to diverse consumer preferences. “The introduction of masala flavors, in particular, has significantly broadened the market’s appeal, prompting speculation on its potential to rival the scale of the noodle market in India,” notes Shaikh.

Breakfast Food Sales at Retail Outlets

Breakfast is on the move. At Hyderabad’s Q-Mart, which has a strong presence in each of the breakfast sub categories, south Indian RTC mixes, millet flours, oats and breads are the popular breakfast foods in demand. According to its promoter and director B.V.K. Raju, “The breakfast category is witnessing strong growth largely fuelled by regional players. There is a strong demand seen in the easy-to-prepare healthy food options. For example, there is a steep increase in the consumption of products like breads, oats, millet flour and idli.”

“The traditional healthy breakfast products are witnessing higher growth than Western food alternatives like corn, flakes, jams, juices, etc. Also, there is a great demand from customers for products that are tasty, healthy and affordable. There is already a strong participation from regional brands that meet these needs and are helping to drive repeat purchases. While there is a natural pull for these categories, the demand generation for conventional breakfast cereal products like cornflakes needs a push,” he adds.

At Modern Bazaar’s 19 store-chain in Delhi-NCR, the breakfast cereal range has been performing well with offerings that include muesli, all bran wheat, corn flakes, ragi flakes, almond corn flakes, strawberry corn flakes, granola, Special K (for women), and millet muesli. In the oats category where Quaker, Kellogg’s, Saffola and Bagrry’s are its top performing brands, the chain has been recording good sales for classic oats, masala oats and oats shake.

In the millets category, brands such as Manna, 24 Mantra, Organic Tattva, and Arya stand out as key drivers of sales at Modern Bazaar, contributing approximately 6% to its overall sales within the breakfast category. Complementing the success of breakfast cereals, the chain also experiences significant demand for Indian breakfast mixes, encompassing a diverse range of offerings including upma mix, rava idli mix, rava dosa mix, vada mix, oats upma mix, ragi dosa mix, vermicelli mix, poha mix, multigrain dosa mix, and oats idli. Within this segment, prominent brands such as MTR, 24 Mantra, Maiyas, and Pillsbury command substantial market presence.

Moreover, in the children’s breakfast segment, a variety of popular offerings including honey loops, choco’s, pancakes, oat-bites, and choco-fills have garnered significant consumer attention. Leading brands such as Kellogg’s, Soulfull, Pillsbury, and Betty Crocker are top performers within this segment, underscoring their appeal and market dominance.

Other brands – Tropicana, B-Natural, Silk, Sundrop, Fun Foods, Veeba – are also big sales pullers at Modern Bazaar, which allocates 5% of its shelf space to the breakfast category that has been clocking 15%-20% growth. “While routine product offerings like cereals, oats and muesli are showing ongoing stability in sales, we are seeing an aggressive growth of around 30% in the new range of premium breakfast category products comprising quinoa, muesli and oats. We are also seeing an upsurge in the consumption of instant ready-to-eat/ cook breakfast mixes because of the changing economic scenario and the needs of evolved urban consumers,” says Kunaal Kumar, MD & CEO, Modern Bazaar.

At SPAR Hypermarkets, which enjoy a strong presence of its own store brands in each of the breakfast sub categories, south Indian RTC mixes, millet flours, oats and breads are the popular breakfast foods in demand. “This is one of the fastest-growing categories, witnessing strong double-digit growth. However, we are excited to see the regional brands witness stronger growth in this segment compared to the national brands, led by product categories like millet flours, brown breads, oats, etc,” says a category manager at the supermarket chain.

Arambagh Foodmart strategically dedicates 8% to 10% of its shelf space to the breakfast category, a segment which contributes approximately 3% to its overall sales. Within this category, eggs emerge as the most favored choice among consumers, with 38% of customers opting for this protein-rich option. Following closely behind are staple items such as roti or toast, preferred by 32% of patrons, while cereals or oatmeal attract another 30% of the store’s clientele.

How will the Category Shape in the Future

  • India, being a large market with a growing middle income  and double income households, holds great potential for the breakfast food market, which in turn must provide healthy, convenient, and tasteful options.
  • Increasing urbanization, health consciousness, and incidences of diseases such as heart attacks, diabetes, and blood pressure are pushing consumers to switch eating preferences from indulgent to wholesome breakfast options.
  • Consumers are looking to make smarter food choices, and category consumption is being driven mostly by consumers’ desire to start their day with more convenient and better-for-you breakfast options — either at home or on the go.
  • The evolving consumer preference towards healthier, quicker, and snack-like breakfast options has not gone unnoticed by leading brands in the industry. Recognizing this shift, companies such as MTR, ITC, Nestle, Gits, Kellogg’s, and Mother’s Recipe have introduced new products in this category to meet the changing demands of consumers.
  • Furthermore, regional companies like Soulfull and Health Sutra are innovating by combining modern muesli and cereals with traditional Indian grains such as millet and ragi, thereby offering a fusion of flavors and nutritional benefits.

It is evident that a new generation of consumers has emerged, characterized by digital footprints that provide brands with unprecedented insights into their tastes and preferences. Leveraging this wealth of data, brands can better understand their target audience and tailor their products accordingly, ensuring alignment with consumer expectations and preferences.

Beverages typically consumed at breakfast are also getting a nutritional boost, too.

  • Companies are introducing new lines of vegetable and fruit juice beverages as well as newer flavors and blends of vegetable and fruit juice, to its portfolio.
  • Also, there is a growing strength of cold-pressed super-premium juices, players are coming out with a new line of cold-pressed fruit and vegetable juices in conveniently sized bottles.

Like-wise, bakery players are coming up with innovative offerings such as toastable fruit-and-grain breakfast breads that are non-GMO, lower in sodium, vegan, and fat-, nut- and dairy free.

Products are becoming portable and convenient, and you can have them toasted with butter, cream cheese or nut butter, or just as is, because they are infused with fruit. Consumers are looking for an easy, convenient solution for baked goods that taste just like homemade and are made with the same basic ingredients that they can find in their own pantry.

Some brands are reformulating products to meet new better-for-you expectations and interests.

  • Many companies are trying to reformulate, with products that are made with all whole grain and more fiber and bran, and are fortified with nutrients such as calcium, magnesium, and potassium.
  • A growing number of products are being made with less sugar, as well as more gluten-free items and other recent technological innovations that are finding their way into cereal bowls.

Fibers such as inulin and fructooligosaccharides are being added as prebiotics to the diet to increase the chances of good bacteria thriving in the intestine. The benefit of all of these products is that they add to the fiber in the diet. The benefits of eating cereal containing prebiotics and probiotics can be tangible for consumers with stomach problems and digestive ailments ranging from constipation to colon cancer.

These sorts of cereals are more likely to be found now on the shelves of mainstream retailers looking to corner the lucrative health and wellness market. And even the most basic breakfast foods are being looked at with a new kind of health halo.

Consumers are growing an insatiable appetite for protein, especially at breakfast. Typically, most of the protein we consume is eaten at dinner, but that’s beginning to shift.

People are looking for high-quality protein options throughout the day, and that includes breakfast. The protein megatrend is expected to continue for the next five to 10 years, say market analysts.

Meanwhile, globally inspired ingredients are lending fresh flavors to the breakfast fare. In a report on breakfast trends, the Chicago-based American Egg Board highlighted the influence of Asian flavors on breakfast items, noting that millennials and Generation Z consumers enjoy Asian products like sriracha, fermented foods and chili sauces that work well with classic breakfast comfort foods.

Many common breakfast foods – like eggs – offer a mild flavor base to layer on the salty, tangy and spicy flavors of Asian cuisine. Several brands that offer breakfast-style products are going international with new items. Bolder flavors – which may or may not be ethnic in origin – are also a hallmark of many new breakfast products.

So, ranging from boxes to bowls, sticks to bars, breakfast products are coming in different formats – they run hot, cold and somewhere in between. They come in grab-and-go and single-serve formats, as well as family-size. Nutrition bars and cookies are other hot spots within the breakfast arena. There are also bright spots for many other products consumed for breakfast or, for that matter, breakfast foods that can be consumed at other parts of the day. At the same time, consumers are seeking more grab-and-go foods while on other occasions looking to take greater ownership of making their own meals. There’s room for both ways of preparing and enjoying breakfast, just as stalwart favorites stand on store shelves alongside new items.

Consumers’ parallel interests in high-quality, better-for-you foods are bumping up against their need and desire to get moving in the morning.  They want ownership, but their mantra is, ‘How do I get out of the kitchen quickly?’ That seems to be the changing definition of convenience — fresh, in a quicker amount of time. These parallel and shifting habits are also being watched by breakfast food companies even as consumers continue to value quick, easy-to-prepare, satiating breakfast items that are also convenient to eat on the go.

Finally, bringing it full-day circle, there’s no time like the present to promote the next day’s breakfast. The main way to ensure customers think about the grocery store for breakfast options is to make sure that retailers have the product when the consumer is in the store, so they know you are a destination, whether it’s for an individual breakfast or office/ family get-together,” advises Raju. He continues: “Have breakfast options available during the early evening rush hours for the next day so consumers don’t have to stop on their way in to work, and ensure a large bakery breakfast display bright and early during the weekend.”

Conclusion

According to Shaikh, “In the competitive landscape of the breakfast market, the battle centers around capturing the consumer’s attention for the first meal of the day. This holds significant importance from both the brand’s perspective and the retailer’s standpoint. For merchandisers, it is imperative to discern emerging trends by analyzing data at a granular level, thereby gaining insight into broader market dynamics.”

  • Companies focus on three things – taste, nutrition, and value – when considering new products and product reformulations, that can expect to excite consumers’ interest for their products and get their attention.
  • Consumers in increasing numbers will search for breakfast options that are natural, organic, gluten-free, high in protein and lower in sugar, and those varieties that fit these needs will gain in precedence.

Going forward, greater demand for healthier and more wholesome products will be the key growth driver for the breakfast category. As awareness rises, consumers will look for options that give them functional benefits in their endeavor to stay fit. Another trend playing out and expected to gather further momentum in the days ahead will be the merging of ethnic tastes with convenient lifestyle habits and a need for nutrition. These will present retailers and producers plenty of opportunities for creating contemporary breakfast offerings that are convenient, healthy and tasty.

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