KANSAS CITY, MO — Bagels are both an iconic on-the-go breakfast option and an authentic coffee shop snack. Classic, convenient and customizable, bagels, whether savory or sweet, meet diverse consumer needs. The overall US bagel market totals $2.28 billion, according to Circana for the latest 52 weeks ending July 14, 2024.
Center store bagels represent the larger share of the US market, reporting $1.79 billion in sales, according to Circana. However, growth is stagnant and volume is down -1.1% vs. the same period last year. Conversely, perimeter bagels reported 4.2% dollar growth vs. a year ago, but unit sales declined -1.2%.
“Center store bagel dollars are flat because prices have come down as compared with bagels in the perimeter, where prices are still elevated versus a year ago,” said Melissa Altobelli, senior VP, client insights, dairy and bakery vertical for Circana.
Center store private label brands posted both dollar and unit increases, 3.5% and 1.3%, respectively. Altobelli explained this growth is driven by inflation and consumers purchasing less expensive options. National bagel brands have lost dollar and unit share to private label across most bread subcategories in the latest 52 weeks, and in the perimeter, private label bagels hold 98.7% of the dollar share. However, private label increases are reversing.
“Cracking the code on bagel shop taste and texture, creating flavor variety and a crust that crackles, establishes opportunity for brands on the perimeter.” — Melissa Altobelli | senior VP, client insights, dairy and bakery vertical | Circana
“There has been a decline in private label sales for the latest 26, 13 and four weeks, which we attribute to consumers trading up for more premium brands instead of eating out,” she said.
Growing interest in authentic, artisanal baked goods has positively impacted the bagel market, according to a Grand View Research market analysis. Bagels made using traditional techniques with quality ingredients are perceived as premium.
“Consumers are dining out less as a means of cutting back to stay within their budgets,” Altobelli said. “They are opting for artisanal bagels that replicate those from a coffee shop or breakfast out and willing to purchase more premium products that can be eaten at home or as a convenient grab-and-go option.”
While perimeter bagels represent a small market share, there is innovation potential, according to Altobelli. Bagels that tout an authentic restaurant experience at a fraction of the cost will compete more effectively with coffee shop bagels.
“Cracking the code on bagel shop taste and texture, creating flavor variety and a crust that crackles, establishes opportunity for brands on the perimeter,” Altobelli said. “Highlighting convenience of purchase in-store at a lower cost is a win.”
This story has been adapted from the October | Q4 2024 issue of Commercial Baking. Read the full story in the digital edition here.
