This report looks at the following areas:
- Market size and forecast of the in-store bakery sector
- Number of outlets and changes in leading bakery brands
- Noteworthy marketing activities and new product trends in the bakery market
- Channels for purchasing bakery products and consumer perceptions of these channels
- Attractive product features and filling preferences
- Plans for trading up and down in bakery products and budgeting methods
As consumers continue to spend cautiously, bakeries need to enhance the authenticity and freshness of their offerings. Innovations can draw inspiration from seasonal produce and local food cultures to maintain consumer interest.
Rika Huang, Senior Analyst, China Insights
Market Definitions
This Report covers bakeries, including bakery chains and independent bakeries (both online and offline), as well as bakery sections in hypermarkets, supermarkets, tea houses and coffee shops. The bakery products in this Report include freshly made and short-shelf-life bread, cakes, sandwiches and cookies/biscuits.
Barcoded packaged bakery products sold via retail channels are not included in the market size.
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Executive summary
- Key issues covered in this Report
- Definition
- What you need to know
- The market
- Bakery sales continue to pick up
- Market factors
- Companies and brands
- Outlet numbers have declined overall, and leading brands are gradually being replaced
- Key trends in marketing activities
- Key trends in new product development
- Examples of products reflecting these trends
- The consumer
- Channels for purchasing bakery products have remained largely unchanged
- Graph 1: purchase channels, 2024
- Consumers have a favourable impression of bakery chains, while O2O channels have yet to establish unique advantages
- Graph 2: perceptions of purchase channels, 2024
- Amid intentional spending, substantial ingredients hold the greatest appeal
- Graph 3: attractive product features, 2024
- Nut and fruit fillings are the most popular, while spicy flavours have limited appeal
- Graph 4: novel filling preferences, 2024
- There is potential for premiumisation, and the fresh Chinese pastry market shows resilience
- Graph 5: changes in purchase behaviour, 2024
- Private label bakery products are the top choice for saving money
- Graph 6: budgeting behaviours, 2024
- Consumers are most satisfied with pudding tarts and bagels, and most interested in trying dacquoise and maritozzi
- Graph 7: attitudes towards bakery products, 2024
- Graph 8: attitudes towards bakery products (net), 2024
- Issues and insights
- What we think
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The market
- Market size and forecast
- After seeing a recovery, in-store bakery sales are poised to continue growing
- Market factors
- Consumers’ financial situation and confidence has improved overall
- Graph 9: changes in financial situation, 2022-24
- Graph 10: confidence in future financial situation, 2022-24
- The rebound in the foodservice industry and dining out will drive the recovery of bakery sales
- Graph 11: changes in spending – spent more compared to last month, 2022-24
- Controversy around high pricing is giving rise to budget-friendly bakeries
- Graph 12: social media* mentions of ‘bread assassin’ and ‘RMB2 bakeries’, 2023-24
- ‘White people food’ and ‘dry lunch’ boost the acceptance of bread as a staple food
- Graph 13: social media* mentions of ‘dry lunch’ and ‘white people food’, 2023-24
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Companies and brands
- Market share
- The market is changing rapidly and the total number of bakery outlets has declined
- Holiland expands business to seek new growth opportunities
- Sub-branding replicates successful paths
- Marketing activities
- Pairing freshly baked bread with farm-fresh milk
- Famous ingredient brands become the most direct quality endorsement
- Blind box promotions are a win-win for brands and consumers
- New product trends
- Independent bakeries are demonstrating their innovation through fresh yeast
- Overflowing fillings make an immediate visual impact
- Not just for novelty: unusual sizes and shapes offer new textures and cater to specific occasions
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The consumer
- Purchase channels
- Channels for purchasing bakery products have remained largely unchanged
- Graph 14: purchase channels, 2024
- Graph 15: ranking of purchase channels, 2021, 2023 and 2024
- Consumers in Tier 2 cities prefer hypermarket/supermarket baked goods, while tea houses are more popular in Tier 3 and lower cities
- Graph 16: purchase channels, by city tier, 2024
- Consumers’ repertoire of purchase channels is increasingly bifurcated
- Graph 17: repertoire analysis of purchase channels, by age, 2024
- Graph 18: repertoire analysis of purchase channels, 2023-24
- Channel usage among high-income and other income groups shows clear distinction
- Graph 19: repertoire analysis of purchase channels, by monthly household income, 2023
- Graph 20: repertoire analysis of purchase channels, by monthly household income, 2024
- Perceptions of purchase channels
- Convenience, food safety, product range and value for money are highly recognised attributes of purchase channels
- Graph 21: perceptions of purchase channels – median and standard deviation, 2024
- Graph 22: perceptions of purchase channels, 2024
- Independent bakeries have room for improvement in consistency and food safety
- Graph 23: perceptions of bakery chains vs independent bakery houses, 2024
- Supermarket bakery sections have a competitive edge in freshness, and can enhance value for money through flavour upgrades
- Graph 24: perceptions of bakery sections vs packaged snacks sections in hypermarkets/supermarkets, 2024
- Developing unique advantages is the main challenge for O2O retailers
- Graph 25: perceptions of hypermarkets/supermarkets vs O2O retailers, 2024
- Bakery products in coffee shops have further potential for exploration
- Graph 26: perceptions of coffee shops vs tea houses, 2024
- Attractive product features
- Genuine ingredients and freshness are key elements of on-premise baked goods
- Graph 27: attractive product features, 2024
- Rather than rushing to reduce sugar, leverage health-oriented improvements to enrich product portfolio
- Graph 28: attractive product features – whole wheat/whole grain products, by region, 2024
- Graph 29: attractive product features – natural yeast, by age, 2024
- Communicate ingredient content through quantifiable measures and visual cues
- Novel filling preferences
- Nut and fruit fillings are the most popular, while spicy flavours have limited appeal
- Graph 30: novel filling preferences, 2024
- Use tea houses and WeChat Weidian stores as pilot channels for innovative fillings
- Graph 31: Frequency analysis – novel filling preferences (by channel), 2024
- Trading up and down
- There is potential for premiumisation, and the fresh Chinese pastry market shows resilience
- Graph 32: changes in purchase behaviour, 2024
- Graph 33: changes in purchase behaviour (net), 2024
- Women and Tier 1 city residents are more inclined to trade up in fresh Western-style baked goods
- Graph 34: willingness to trade up in freshly made Western baked goods (net), by city tier, 2024
- Graph 35: willingness to trade up in freshly made Western baked goods (net), by gender, 2024
- Budgeting behaviours
- Private label bakery products are the top choice for saving money
- Graph 36: budgeting behaviours, 2024
- Return to basic baked goods, providing flavour or filling pairing guides
- Graph 37: budgeting behaviours, 2024
- Chinese alternatives may steal market share from Western-style baked goods
- Graph 38: budgeting behaviours, 2024
- Younger women are inclined to buy less frequently, while older women prefer to stock up during sales or not buy at all
- Graph 39: selected budgeting behaviours, by gender and age, 2024
- Graph 40: budgeting behaviours – reducing consumption frequency, by gender and age, 2024
- Attitudes towards bakery products
- Consumers are most satisfied with pudding tarts and bagels, and most interested in trying dacquoise and maritozzi
- Graph 41: attitudes towards bakery products (net), 2024
- Graph 42: attitudes towards bakery products, 2024
- Consumers show limited interest in trying bread with a chewy texture
- Novel bakery products appeal more to younger consumers
- Graph 43: repertoire analysis of attitudes towards bakery products, by age, 2024
- Graph 44: attitudes towards selected bakery products, by age, 2024
- Novel baked goods also have potential in lower tier cities
- Graph 45: repertoire analysis of attitudes towards bakery products, by city tier, 2024
- Graph 46: attitudes towards select bakery products, by city tier, 2024
- Interest in trying is not correlated with potential for premiumisation
- Graph 47: trading up in freshly made Western baked goods, by repertoire of bakery product types, 2024
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Issues and insights
- Leverage seasonal and regional features to localise bakery products
- Maintaining freshness with seasonal and local characteristics
- Examples of products combining local flavours with seasonality
- Innovation can go beyond seasonal ingredients
- Increase confidence in product quality through clear communication
- Establish a clear labelling system to address ‘involution’ of ingredient claims
- Literal branding offers reliable proof of freshness
- Position bread as a food for mealtimes
- Make bread a mealtime food for various occasions and provide pairing guidance
- Craft unique flavours for home consumption occasions
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Appendix – market size and forecast, methodology and abbreviations
- Market size and forecast
- Methodology
- Abbreviations
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