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In-store Bakery Experience - Canada - November 2018

"Canada’s grocery retail landscape is changing. While much of the chatter revolves around online shopping, the fact remains that most grocery “trips” happen on site. That said, the evolving divide between online and bricks and mortar means that to maintain an advantage, retailers are increasingly pressured to offer experiences that are relevant. In-store bakeries are a part of this equation. While freshness is of core value for in-store bakeries, it’s not the only point of differentiation. Aside from assortment, retailers can look to model their bakeries to meet the variety of demands that today’s consumers have. This extends beyond indulgent desserts, but also to snacks that can prove healthier for earlier parts of the day when consumers are more likely to consider factors related to health, energy and portability. In-store bakeries that work in concert with other in-store departments executing as part of a broader strategy to provide contemporary day-to-day meal and snack solutions stand to be more relevant."

Joel Gregoire, Associate Director - Food & Drink

This report will look at the following areas:

  • Stand-alone bakeries represent an area of competition
  • Longer-term stagnation in baked good sales
  • Younger consumers are less likely to make purchases from in-store bakeries

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Table of contents

  1. Overview

    • What you need to know
      • Definition
      • Executive Summary

        • The issues
          • Stand-alone bakeries represent an area of competition
            • Figure 1: Opinions on in-store vs stand-alone bakery, August 2018
          • Longer-term stagnation in baked good sales
            • Figure 2: Retail market volume consumption per capita of bread and bread products and sweet bakery, 2013-2017
          • Younger consumers are less likely to make purchases from in-store bakeries
            • Figure 3: Purchase at in-store bakeries, by age, August 2018
          • The opportunities
            • Fresh-focus is at heart of in-store bakery’s appeal
              • Figure 4: Important factors when choosing a product from an in-store bakery, August 2018
            • Cross-daypart opportunities helps drive more frequent product usage
              • Figure 5: Correspondence Analysis – Snacking occasions, July 2016
            • New flavours and less-familiar formats represent an opportunity to differentiate
              • Figure 6: Interest in flavour and format innovation from in-store bakeries, August 2018
            • What it means
            • The Market – What You Need to Know

              • Bread and sweet bakery sales are soft
                • Canadians strive to eat healthy most of the time
                  • Immigration fuelling Canada’s population growth
                  • Market Size and Forecast

                    • Bread sales to remain relatively flat
                      • Figure 7: Canada retail value sales and fan chart forecast of bread & bread products, at current prices, 2012-23
                      • Figure 8: Canada retail value sales forecast of bread & bread products, at current prices, 2012-23
                    • Modest growth forecast for sweet bakery
                      • Figure 9: Canada retail value sales and fan chart forecast of sweet bakery, at current prices, 2012-23
                      • Figure 10: Canada retail value sales and fan chart forecast of sweet bakery, at current prices, 2012-23
                  • Market Factors

                    • Canadians are more time-pressed
                      • Most Canadians live in urban areas
                        • Figure 11: Share of Canadians that live in urban and rural areas, 1851-2016
                      • Mobile technology enabling unprecedented opportunity to interact
                        • Figure 12: Mobile and smartphone penetration, by age group, May 2017
                      • Immigration fuelling Canada’s population growth
                        • Figure 13: Top 10 countries of birth of recent immigrants, 2011-16
                      • Canada’s population is aging
                        • Figure 14: Population aged 65 years and over in Canada, historical and projected (% of total), 1971-2061
                      • Canadians strive to eat healthy most of the time…
                        • Figure 15: Healthy eating, November 2016
                      • ...but flexibility may be contributing to the high obesity rates
                        • Figure 16: Body mass index, self-reported rate of being overweight or obese among Canadian adults, by gender, 2010-14
                    • Key Players – What You Need to Know

                      • Carb-consciousness diets represent a potential challenge to growth
                        • Snackable baked goods are an opportunity
                          • Baked goods for specific diet to become more prominent
                          • What’s Working?

                            • Demand for better experiences a potential growth-booster
                            • Challenges

                              • Carb-consciousness diets represent a potential challenge to growth
                                • Figure 17: Mojo Me Chocolate Brownies (South Africa), July 2018
                                • Figure 18: Julian Bakery Pegan Ginger Snack Cookie Protein Bar (US), March 2017
                                • Figure 19: Julian Bakery Paleo Wraps (US), August 2018
                                • Figure 20: Growfit Ultra Low Carb Flower (India), June 2018
                            • What’s Next?

                              • Snackable baked goods are an opportunity
                                • Figure 21: Correspondence analysis – snacking occasions - July 2016
                              • Baked goods for specific diet to become more prominent
                                • Figure 22: Strawberries & Cream Artisan Raw Cake (UK), July 2018
                                • Figure 23: Lazy Day Foods Free From Tiffin Bites (UK), March 2018
                                • Figure 24: Vega Divas Baked Goods & Desserts Banana Chocolate Cupcakes-to-Go (USA), January 2018
                                • Figure 25: Vegan Cocoa & Goji Berry Muffins (South Africa), July 2018
                                • Figure 26: Probios Go Vegan! Organic Vegan Wheat Croissant with Chocolate Cream (UK), March 2018
                                • Figure 27: The Free From Bakehouse Bakery Banana &Date Flapjack (UK), July 2018
                                • Figure 28: Ozery Bakery Organic Morning Rounds Cranberry Orange Flavoured Toastable Fruit and Grain Buns (UK), November 2017
                            • The Consumer – What You Need to Know

                              • In-store bakery’s importance reflect Canada’s retail evolution
                                • Demand for freshness reflects core appeal of in-store bakery
                                  • Opportunity to bring theatre to the bakery
                                    • Looking abroad can be an inspiration for innovation at home
                                      • Foodservice focus can help focus innovation for growth
                                      • In-store Bakery Usage

                                        • In-store bakery’s importance reflect Canada’s retail evolution
                                          • Figure 29: Locations where baked are purchased, August 2018
                                        • Over half of consumers made a recent in-store bakery purchase
                                          • Figure 30: When and where baked goods are purchased, August 2018
                                        • Young women key to growing bread at in-store bakery
                                          • Figure 31: When bread from an in-store bakery was purchased, women 18-34 vs overall, August 2018
                                        • Foodservice focus can help focus innovation for growth
                                          • Figure 32: Correspondence Analysis – Principal map – Purchase location, August 2018
                                          • Figure 33: Where bread and desserts are purchased, by age group, August 2018
                                      • Choice Factors

                                        • Demand for freshness reflects core appeal of in-store bakery
                                          • Figure 34: Important factors when choosing a product from an in-store bakery, August 2018
                                        • Canadians are looking for natural baked goods
                                          • Figure 35: Importance of all-natural ingredients when choosing a product from an in-store bakery, by age, August 2018
                                        • Added nutrition is a purchase driver
                                          • Figure 36: Importance of nutrition-related considerations when choosing a product from an in-store bakery, by age, August 2018
                                        • New flavours reflects opportunity to differentiate
                                          • Figure 37: Importance of flavour combinations when choosing a product from an in-store bakery, by age, August 2018
                                        • It’s important to remember value’s importance to younger consumers
                                          • Figure 38: Importance of price vs “baked on same day”, by age group, August 2018
                                      • Opportunities for Innovation

                                        • Opportunity to bring theatre to the bakery
                                          • Provenance can be the basis for story
                                            • Figure 39: Areas of interest from in-store bakeries, August 2018
                                          • Looking abroad can be an inspiration for innovation at home
                                            • Figure 40: Interest in internationally-inspired options from in-store bakeries, Chinese Canadians vs overall, August 2018
                                          • Canadians fall for seasonal flavours
                                            • Figure 41: Interest in seasonally-inspired options from in-store bakeries, 18-34s with household incomes of $70K or more vs overall, August 2018
                                          • Demand for health innovation at in-store bakeries requires context
                                            • Figure 42: Interest in health-related considerations from in-store bakeries, 18-44s vs over-45s, August 2018
                                        • Consumer Segments

                                          • Success with women key to in-store bakery’s success
                                            • Figure 43: Purchase of sweet baked goods from in-store bakeries, by gender, age and parental status, August 2018
                                            • Figure 44: Purchase of sweet baked goods from in-store bakeries, by gender, August 2018
                                          • Flavour and format exploration key to winning over Chinese Canadians
                                            • Figure 45: Purchase of sweet baked goods from in-store bakeries, Chinese Canadians vs overall, August 2018
                                            • Figure 46: Interest in select options from in-store bakeries, Chinese Canadians vs overall population, August 2018
                                        • Appendix – Data Sources and Abbreviations

                                          • Data sources
                                            • Sales Data
                                              • Consumer survey data
                                                • Correspondence analysis
                                                  • Abbreviations and terms
                                                    • Abbreviations

                                                    In-store Bakery Experience - Canada - November 2018

                                                    US $4,395.00 (Excl.Tax)