During the webinar, Melissa Altobelli, senior VP of client insights for the dairy and bakery vertical at Circana, shared product launch data from 2024 and 2023 in deli, dairy and bakery categories and the underlining trends inspiring product innovation.
Center-store bakery provides convenient pack sizes, wellness options
Half loaves and wellness-focused options — including gluten-free and keto bread, buns and rolls —remained popular in the center-store bakery.
Nature’s Own Keto sold $3.6 million or 531,300-units, and Nature’s Own Half Loaf sales reached $1.1 million with 407,300 units sold, according to Circana POS data ending Aug. 11. Both products were launched in April.
Portion size, flavors and functional attributes were prevalent in the sweet baked goods segment of the center-store in the first half of 2024.
Legendary Foods' Protein Pastry sold $3.1 million or 318,000 units since its launch in April, per Circana POS data from launch until Aug. 11. Additionally, Entenmann’s Brownie Drizzle Drops and Little Debbie Mini Muffin Big Pack sold $1.2 million and $1.5 million, respectively, for the same period. Both products launched in January.
These center-store bakery options are not necessarily making their way into the perimeter of the store, which can be an innovation opportunity, Altobelli noted.
“I do not see as many health and wellness options, flavor options in the perimeter area, and I do continue to think that that is an area for perimeter expansion to take some of those center-store sales,” Altobelli elaborated.
Pack sizes & new flavors drive line extension in dairy, natural claims gain popularity
Dairy department innovation lagged, as line extensions focused on flavors and newer brand launches focused on natural product claims.
The top 15 dairy producers launched 2,488 products in 2023, a decline from 2,978 launches in 2021, according to Circana OmniMarket data. Similarly, new items with line extensions declined from 2,160 launches in 2021 to 1,986 in 2024, according to Circana.
However, the number of new items from brands rose from 476 in 2022 to 502 in 2023 but was below the 818 launches in 2021.
Dairy line extensions in 2023 were driven by pack size and new flavors, Altobelli explained. Dairy producer Sargento launched 3 Cheese Mexican and Jalapeño Pepper & Garlic Herb varieties of its cheese, while ice cream maker Häagen-Dazs released a line of frozen novelties in 14-ounce pack-sizes.
Blue Bunny’s soft-serve ice cream brand, Soft, and Turkey Hill Simply Natural line of ice creams launched as a new brand in 2023, each focusing on natural ingredients.
Deli is ‘one of the fastest growing categories’
The deli department is “one of the fastest growing categories” in food and beverage, as consumers increasingly demand a range of heat-and-eat food options, deli trays and various cut, cubed and sliced meats and cheeses, Altobelli noted.
The deli department added 24 more items in the set over the last three years, with deli-prepared options adding 19 more items during the same period, according to Circana integrated fresh data. Stores stocked 448 different items on average in the deli department per store, with units growing 3% over the last three years, Circana reported.
However, the deli market faced pressure earlier this year from the recall of Boar’s Heads products due to concerns about a listeria outbreak. Deli-service lunch meat dollar sales declined by 16.1% and units by 12.9%, though deli pre-sliced lunch meat grew 3.6% in dollars and 6.9% in pounds for October, according to separate Circana data.