The rise of specialty bakeries is driving compelling changes in the retail bakery landscape. In India, specialty bakery* items are perceived to be a source of indulgence, superior to regular bakery items such as white bread, khari, or sliced packaged cakes. Influenced by global trends in modern café bakery culture, urban-dwelling and affluent consumers, in particular, seek intense flavours and enjoy trying the new formats and tastes that specialty bakery items have to offer. Mintel data reveals that36% of Indian consumers frequently visit bakery shops/or cafés just to check out what’s new in baked goods.
As renowned international café and bakery chains such as PAUL and Magnolia have opened branches in Indian metros, home-grown cafés and bakeries are catching up by innovating and offering specialty bakery produce that have western influences or fusion flavours.
The strong appeal of next-level indulgence
Specialty bakery consumers want intense flavours and superior indulgence. This encompasses the all-important visual appeal, as it truly is a category that brings to life the saying “eat with your eyes”, especially now that consumers are also seeking a share-worthy experience. This has been propelled by social media platforms which have enabled the documentable experience of food and drink.
The demand for indulgence is at the forefront for Indian millennials. For instance, 32% of 25-34-year-old consumers mentioned that indulgence is more important than health when it comes to bakery items, which over-indexes the total average of 27%. Consumers’ unwillingness to compromise on taste is also seen as 36% of metro dwellers prefer portion control over choosing low-sugar variants in baked goods.
Consumers also look to the specialty bakery category as one which offers novel flavours and formats.Mintel Food and Drink Trend, Eat With Your Eyes, suggests that the growth of e-commerce and consumers’ increased craving for novelty will lead to more brands experimenting with immersive experiences using colours, textures, audio, and scents.
Specialty bakery brands can leverage this trend, for example, by offering limited editions (especially during festive seasons) to further expand their reach and help pique consumers’ interest levels.
Striking the right balance on health consciousness
While indulgence is the major consumption driver in the specialty bakery category, consumers are also increasingly looking for offerings that balance their indulgent cravings with a twist of healthfulness.
For instance, when choosing bakery products, 37% of Indians regard reduced carbohydrate content as important, while 50% regard all-natural ingredients as important. As a result, claims such as low GI (glycemic index) or carbohydrates, or made with all-natural ingredients, will resonate in bakery items. In addition, consumers in the West (55%) and North (49%) regions of India are more proactive when it comes to the nutritional benefit proposition in bakery items.
One of the ways that this contradiction (health and indulgence) can be tackled is through ‘permissible indulgence’ offerings. By formulating with ingredients that provide some goodness, without compromising on the overall taste. Examples include the use of all-natural ingredients, nutritious but indulgent ingredients such as nuts or healthy fats, and recipes that are ‘less sweet’ or made with natural sweeteners. They can also communicate ingredient stories and benefits without compromising on taste and indulgence.
The rise in home baking stimulates growth for specialty bakery
Amidst the COVID-19 lockdown, home-bound Indians have embraced the bake-at-home culture, with a surge in search terms like ‘baking bread at home‘ and ‘banana bread recipe without eggs‘. In addition to banana bread, viral bakery trends such as Pull-Up Cake, Hammer, Sour Dough, all made a mark in 2020.
Home bakers are not only utilising digital channels to learn new baking skills but also use social media channels to showcase their baking skills. This gives specialty bakeries a chance to engage consumers on these platforms and make baking a creative and rewarding ritual, a family-bonding exercise, or even a therapeutic effect for consumers who are looking to de-stress.
Adapting the Indian specialty bakery industry to the next normal
Mintel’s TrendWellbeing 2021: Health Undefinedobserves that the pandemic placed health and wellness at the forefront of every consumer decision. Indian Consumers are looking for indulgent treats that can provide a temporary sense of emotional wellbeing. Specialty bakery brands can tap into this need and position brands around anchors of ‘comfort’ and ‘security’ and ‘de-stressing’ as consumers cope with the reality of the ‘next normal’.
Foods that offer affordable, permissible indulgence will continue to be in demand and can help consumers achieve their overall holistic health and mental wellbeing goals.
*Specialty bakery items include: Croissants, Puffs, Specialty Cakes/Pastries, Specialty Breads (e.g. Sourdough), Donuts, Tarts, Pies, Macaroons, Stuffed/ Cream Rolls and other sweet/ savoury items in foodservice/ specialty bakery. Some of these products are available at local bakery stores that may or may not be sold in packaged format.
Exclude: Biscuits/Cookies, White/Brown/Fruit Breads, Rusks, Packaged sliced cakes and other packaged pastries & baked goods.