Biscuits broadens its boundaries

With the biscuit category regularly offering new innovations, SLR looks at why it is such an important and diverse category.

by Iain Hoey

Size of the category

Valued at £2.3bn, the UK biscuit market is a key category for convenience stores as the category continues to cater to many different occasions, from on-the-go, to the Big Night In, as well as cracking the savoury and light-indulgencies markets.

Sweet biscuits, such as chocolate digestives and custard creams, hold the majority share of the biscuit market, worth £1.4bn. The savoury biscuit category has seen over 20% value growth over the last 2 years and, despite being a relatively recent development, and healthy biscuits continue to hold their own in the market, with a value of £486m.

“Biscuits are purchased almost weekly and we consume on average 9kg of biscuits per year,” says Hena Chandarana, Trade Communications Controller at pladis. “That’s the same as 30 packets of McVitie’s Chocolate Digestives.”

Merchandising

Merchandising is extremely important, as with any category, when it comes to driving incremental sales. Retailers should stock bestsellers from the sweet, healthy and savoury biscuits sectors, and make sure the most popular brands are represented, as well as a range of own-brand offerings of biscuit staples such as digestives, bourbon creams and rich tea biscuits.

To help independent retailers maximise the biscuit category potential, pladis invested in the ‘Better Biscuits, Best Sellers’ (BBBS) scheme. This initiative included remerchandising fixtures in line with BBBS advice, ranging the best-selling SKUs and improving visibility and availability.

Last April, pladis carried out trials in three of its Ambassador stores to find the most effective way to merchandise biscuits. Steps taken included: improving segment and brand blocking, moving key selling lines to eye level, increasing facing of best-sellers and reduced duplication between own label and branded products. The study found that by reducing the facing from 90 SKUs to 66 SKUs, there was a 19% sales uplift.

Retailer Ambassador, Kay Patel, Owner of Best One Stratford, states: “The trial did make the fixture easier to shop by double facing key lines and reducing some duplication. Double facing lines such as Jaffa Cakes helped increase sales especially during promotions. I’m now looking to roll it out to my other stores.”

The biscuit occasion

As consumer consciousness surrounding health continues to rise, Borders biscuits have noted a rise in sales of their premium biscuits as those looking to indulge look for a quality offering. Equally important for small indulgences are on-the-go biscuits which have seen a rise in the last year. BelVita Breakfast is now not only the UK’s number one healthy biscuit (Nielsen Data), it is now the UK’s number two biscuit brand and is currently showing 11% growth.

Research undertaken by belVita also shows that 46% of Brits state they are more likely to have a good day if they eat breakfast. Retailers have a great chance to drive sales by offering convenient formats which cater to consumers’ busy lives.

Chandarana says there is a big market for more on-the-go biscuit offerings. “Currently only 7% of biscuit products are in on-the-go formats which highlights a clear need for manufacturers to bring new products to market that deliver against this mission,” she says.

In May 2016, pladis launched McVitie’s ‘To Go’ snack packs. The twin packs – McVitie’s first on-the-go sweet biscuit range – enable shoppers to enjoy their favourite classic McVitie’s biscuits in a modern format, wherever and whenever it suits them.

Chandarana also notes that “the rise of coffee culture” will have a positive impact on the biscuit market. “One in four convenience stores owning a coffee machine and there being 54 million hot drink and biscuit occasions in the UK every year presents a big opportunity to increase biscuit sales through hot drink links in store,” she explains.

Sharing continues to be an important snacking trend in the UK with biscuits as the number two evening snacking choice (Nielsen data). Providing sharing biscuit products in appropriate pack formats is the key to unlocking this opportunity. In 2016, pladis announced McVitie’s Digestives Nibbles, offering the McVitie’s Digestive biscuit range in a modern bitesize format, which has proven popular among consumers. Also tackling the sharing cookie market is Burton Biscuits, with the launch of Maryland Cookie Bites.

Savoury biscuits

Another massive trend seen in the biscuit industry in recent years has been the rise of the savoury biscuit, rivalling crisps in the snacking market. Portion control, the growth of food-to-go, and increasing demand for savoury biscuits have all been contributing factors that have had an impact on biscuit sales in convenience over the course of the past year.

Burton’s entered the savoury biscuit sector in early 2014 with huge success, generating sales in excess of £25m with Burton’s Fish ‘n’ Chips and Cathedral City Baked Bites, which together have driven growth. In 2015, Jacob’s Cracker Crisps challenged the fried snacks category and has grown category sales by £14m.

A healthier choice

With dietary restriction causing many consumers to move towards Free From products, retailers should consider catering to the trend by offering a selection of Free From products. In biscuits, McVitie’s Gluten-Free Original Hobnobs were recently launched alongside McVitie’s Gluten-Free Milk Chocolate Hobnobs by pladis to capture the market.

The most popular recent trend from biscuit makers is the biscuit thin. Mondelez introduced Oreo Thins at the beginning of the year, which are a slimmer Oreo cookie with a layer of Original Vanilla or Chocolate Creme cream. The product offers a new, more sophisticated eating experience that answers consumer desires for a thinner and crispier everyday treat while still delivering on taste.

McVitie’s Digestives Thins, a lighter version of the classic biscuits, also hit the shelves earlier this year. The product is available in three variants: Milk Chocolate, Milk Chocolate Cappuccino and Dark Chocolate with the intention of tapping into the desire for little indulgencies.