Focus: Allied Bakeries aims to halt sliced white decline
Allied Bakeries launches Kingsmill Great White
White bread sales are the largest component of the UK bakery sector. But sales of white bread are in structural decline. Associated British Foods' bread business, Allied Bakeries, believes it has developed a product that can help reverse this trend and bring consumers back to sliced white. Katy Askew reports.
Packaged bread sales accounted for the majority of UK bread sales last year and sliced white is the largest product in this arena. According to Mintel, a research firm, 63% of total bread sales last year were pre-packaged loaves.
However, sliced bread is in long-term decline as consumers switch to other products in the bakery category such as speciality loaves, pittas, wraps and bagels. Other consumers are simply cutting down the amount of bread they eat. Mintel reveals that, since 2008, the volume of sliced bread purchased in the UK fell by almost 8% to 1.37bn kg over the last five years.
White bread has been impacted by a poor nutritional image. Often characterised as "empty calories", white bread has come to be viewed as wholemeal's poor nutritional cousin by increasingly health conscious consumers.
However, Kingsmill manufacturer Allied Bakeries believes it has developed a game-changing new product that can tackle this issue: Kingsmill Great White.
Great White looks like a sliced white loaf. It tastes like a sliced white loaf. But it contains the same level of fibre as wholegrain bread.
Allied Bakeries nutrition and health development manager Nicky Gillett tells just-food the product gives consumers, who like white bread but are turned off the product by associations with poor nutrition, "permission" to start eating white bread again.
These, "juggling pragmatists" are busy families that want to eat more healthily but also desire the taste and texture of sliced white bread, Allied Bakeries management suggests.
Kingsmill Great White, which hits the shelves this month, is Allied Bakeries' biggest launch since Kingsmill 50-50 in 2007. In April, when distribution is fully in place, the company will kick off a GBP6.7m (US$11.1m) marketing campaign which will feature TV, sampling, PR, online and in-store.
Great White will also be supported by a strong run of promotional activity, in an attempt to drive trial purchases, Allied Bakeries, the UK bread arm of Associated British Foods, said at a launch event in London on Friday (7 March).
Allied Bakeries category manager Martin Garlick believes Kingsmill Great White could be "really significant" for the bread category as a whole. Potentially, he suggests, by increasing the health credentials of white bread, the group will be able to win over consumers who have looked to other snacking or breakfast options.
"Our research has suggested that over one-quarter of sales of this product will come from outside the bread category. We are therefore adding incremental volume and value to the bread category," Garlick tells just-food. "When you look at the top ten snacking occasions, bakery is really well represented. Toast is up there in the top ten. If having a healthier option means that more people will turn to toast than other things - that's great from a bakery category perspective."
In addition to incremental category growth, Allied Bakeries believes Kingsmill Great White also has the potential to win over consumers from other brands. The group concedes, however, that Great White could steal some sales from its own sliced products.
Some consumers who have made the switch to 50-50, the Kingsmill-branded sliced bread that represents a half-way house between white and granary, could be tempted back by the improved health profile of Great White. However, the group mostly expects the traffic to flow in the other direction as consumers who still opt for the white sliced option trade to a slightly healthier alternative. In total, the firm expects sales cannibalisation of about 20%.
"Some sales will be from growth in the category, some of its going to be a bit from our products, some of it will be from our competitors. If we are going to hit the size of the opportunity that we think this is, its going to be a good share of that market," Darren Grivell, director of brands at Allied Bakeries, says.
"We want this to be a really significant part of our portfolio, in our top few sellers. You see the size of the opportunity - we are talking GBP100m in three years. The shorthand would be if it is anywhere as close to being as successful as 50-50 we would be very happy," he tells just-food.
Kingsmill Great White is apparently off to a good start. The new product has been warmly received by the company's retail customers - many of which welcome the news that a branded baker is tackling the issue of declining white bread sales head on.
"Retail to a man and woman have been really really positive... about the principle and background. And probably more positive that someone is taking this issue by the scruff of the neck and really trying to do something to reverse this long-term trend, which is the decline in white bread," Garlick explains. "It really resonates with the retailers because they see an overall issue in this category. If we can help to stem the tide to some degree then that is really positive."
The company has secured listings with the UK's major retailers - Tesco, Asda, Sainsbury's, Morrisons and The Co-operative Group - as well as the convenience channel and independent retailers. Kingsmill Great White has been in Tesco for two weeks and both the shelf space allocated and sales generated have "exceeded" expectations, Garlick claims.
Kingsmill Great White is initially available in a full-sized loaf. The company is looking at areas where the concept can be extended, Grivell confirms. Rolls, for instance, are already on the agenda.
With continued pressure on white bread sales, Allied Bakeries hopes it has found an answer in Kingsmill Great White - a product that it believes will be the best thing since sliced (white) bread.
The company is investing significantly behind the new launch but only time will tell whether consumers who want the taste of white bread along with the health benefits of better-for-you products will be won over.
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