Breakfast Cereals - Italy - March 2004

SUMMARY

Italy- a very dynamic market with ready-to-eat cereals accounting for nearly 98% of the total market value. Why are Italian women the prime target for cereal manufacturers? How can you business benefit from the trend for lighter breakfasts and eating quickly? There has been a change in breakfast eating habits as a result of the trend towards healthy eating and demand for added-value goods. Where are the main threats to this sector of the food industry?

Germany- time spent at the breakfast table is diminishing in Germany, however an interesting phenomenon has been developing - in large households individuals are tending to choose their own meals and eat alone. The opportunity is for a broad range of products and shift towards smaller packs or single-portions. How had traditional suppliers fared against the strong discount chains such as Aldi offering their own-brand alternatives? How can you capitalise upon the trends for adult lines, cross boundary extensions and luxury muesli?

France- Breakfast is not traditionally a large meal in France, however the market has remained relatively buoyant. Indulgent adult products such as those containing chocolate chunks or flakes are being launched. How can suppliers target the teenagers and young adults who are vital to the future growth of this sector?

Spain- a declining birth rate and ageing population is giving suppliers many opportunities in Spain. Healthy eating and snacking trends combined with the growth in popularity of organic foods has changed the face of this sector. Where do most Spanish consumers buy their cereal from? Have discounters had a similar impact in Spain as they have across Germany?

UK- the declining number of children has a major impact on this market and the traditional breakfast cereal market will diminish. But where are the areas of growth for your business? Single person households and an increased number of over 55s are favourable emerging trends. What impact will the functional health trends have upon the market? How have the major suppliers fared against the growing popularity of own-brand cereals?

Mintel's latest pan-European report has been designed to offer you an actionable guide to the European market for breakfast cereals.

Written by local industry experts for industry professionals, it provides the level of information you need to focus your marketing activity towards the most profitable sectors of the market. As it maps out the industry trends that shape the sector in each of the five key European markets, it also uses consumer research to identify key target groups whose custom you must capture. Mintel's research answers the crucial industry questions, offering you new analysis of market drivers, market size and trends, market segmentation, distribution, supply structures, NPD, consumers and market forecasts in each report.

A unique level of coverage ensures that your R&D, category management and marketing teams will have both an holistic understanding of the entire sector and a valuable insight into local sector trends and consumer habits. Which means that Mintel's research is highly relevant at any level of the decision making process, whether it be the initial developmental stages or the later brand building exercises.

TABLE OF CONTENTS

Introduction

• Definitions

Abbreviations

Executive Summary

• Good market growth
• Hot breakfast not as popular in Italy as in northern Europe
• Penetration of cereals remains comparatively low
• Health and indulgence are key cereals trends
• Children's segment has one third of sales
• Breakfast eating habits are changing
• New launches also generate consumer interest
• Market led by Kellogg and Nestlé Cereal Partners
• Supplier effort required to maintain cereals consumption, at breakfast or other occasions
• Room to expand penetration

Market Drivers

• Changing breakfast habits can both help and hinder breakfast cereals
• Competition from other breakfast foods
• Figure 1: Penetration and consumption of breakfast foods in Italy, 2003
• Cereals consumption is currently low
• The healthy choice
• Figure 2: Attitudes towards weight and diet in Italy, by gender, 2002
• The focus is on women and children
• Breakfast cereals not dependent on any age group
• Figure 3: Trends in Italian population, by age, 1998-2002
• Figure 4: Consumption of breakfast cereals, by age, 2003
• The rise of singles boosts demand for healthy foods...
• Figure 5: Trends in household size in Italy, 1997-2000
• ...and ushers in the snacking culture
• Employment trends important, but not crucial
• Figure 6: Trends in employment in Italy, 1998-2003
• Increased disposable income for premium products
• Figure 7: Italian consumer expenditure, at current and constant prices, 1998-2003

Market Size and Trends

• Figure 8: Italian retail value sales of breakfast cereals, at current and constant prices, 1998-2003
• Figure 9: Indexed value sales growth in the breakfast cereals market, by country, 1998-2003
• Figure 10: Italian retail value sales of breakfast cereals, by type, 1999-2003
• Figure 11: Italian retail volume sales of breakfast cereals, 1998-2003
• Figure 12: Average price paid for breakfast cereals in Italy, by type, 1998-2003
• Figure 13: Italy, retail value sales of breakfast cereals, by region, 2001-03
• Figure 14: Per capita volume and value consumption of breakfast cereals, by country, 2003

Market Segmentation

• Figure 15: Italy, retail value sales of breakfast cereals, by target group, 2001-03
• Ready-to-eat cereals
• Figure 16: Italian retail value sales of RTE breakfast cereals, at current and constant prices, 1998-2003
• Figure 17: Italian retail value sales of RTE breakfast cereals, by type, 2001-03
• 'Wellness' cereals showing strongest growth
• Figure 18: Italian retail volume sales of RTE breakfast cereals, by type, 2001-03
• Muesli segment benefiting from NPD
• Children's cereals boosted by chocolate varieties
• Organic also gaining favour
• Figure 19: Average price paid for RTE breakfast cereals, by type, 2001-03
• Hot breakfast cereals
• Figure 20: Italian retail value sales of hot breakfast cereals, by type, 2001-03

Distribution

• Retail multiples help widen penetration
• Figure 21: Italian retail value sales of breakfast cereals, by outlet, 2001-03
• Trading base
• Figure 22: Number of retail outlets in Italy: hypermarkets, supermarkets, hard discount stores and cash & carries, 1995-2001
• Online shopping
• Packaging counts

The Supply Structure

Manufacturers' shares

• Figure 23: Manufacturers' value shares of the breakfast cereals market, 2001 and 2003

Companies and brands

• Kellogg Italia SpA
• Nestlé Italiana SpA (Cereal Partners)
• Cameo Vitalis SpA, Dr Oetker
• Weetabix Ltd
• Others

New Product Development

• New product launches

Prospects

• Health or 'wellness' remain key themes
• Offering convenience and expanding usage occasions
• Functional benefits
• Drivers of growth
• Opportunities

Forecast

• Some catching up to do
• Figure 24: Forecast of Italian retail volume sales of breakfast cereals, 2003-07
• Figure 25: Forecast of Italian retail value sales of breakfast cereals, 2003-07
• Improved performance
• RTE to remain dominant
• Adult sector the growth area