Dive Brief:
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Quaker Oats, which accounts for more than 60% of the oatmeal category, experienced first-year success with its single-serve Overnight Oats line, according to Food Business News. The category offset declines in its weight loss and high fiber lines.
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Bob’s Red Mill Natural Foods’ sales jumped 13% in 2017, driven by oatmeal cups, the publication reported. Before the line launched, the company said its customers were asking for oatmeal “on the go.”
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Other brands also have innovated their oatmeal packaging to provide consumers with an easy opportunity for on-the-go consumption, giving oatmeal an advantage over cold cereal.
Dive Insight:
With the decline in sales of cold cereal, oatmeal is well positioned for a complete breakfast takeover at a time when consumers want the first meal more than ever.
Oatmeal has long held a reputation for being healthy, especially when compared to sugar-laced cold cereal peddled by talking cartoon characters. In addition, a Mintel study found 40% of the demographic believes pouring a bowl of cereal is too much work. These advantages have certainly helped the product as consumers are increasingly seeking healthier meal options — unit sales for oatmeal jumped nearly 2% last year. But as cold cereal sales continue to struggle, the opportunity is ripe for oatmeal to gain even more market share.
How do CPG brands compete with the Taco Bell that is now open at 6 a.m.? Or, how does oatmeal take on cereal that is turning to its own portable bars and cups to feed the on-the-go consumer? Increasingly, they are turning to both the health and convenience factors of their product. Oatmeal manufacturers would be wise to embrace social media, where millennials in particular gather, to tout these benefits. They could even offer coupons or introduce trendy new flavors that will attract young moms and turn them into long-term customers.
So far, oatmeal makers have succeeded in turning to convenience. Quaker's Overnight Oats line posted sales of $11.6 million last year, Food Business News noted, a sign it's finding a market with an unmet need. Bob’s Red Mill Natural Foods, the purveyor of organic cranberry orange oatmeal, posted a 13% jump in sales last year. It not only has hip flavors like this, but recently turned to expanding the line to include organic options.
As the portable oatmeal trend continues, brands embracing single servings will likely face criticism about waste, similar to the lingering concerns over Keurig and its K-cups. But for now, the demand for convenience and better-for-you foods will likely draw more people to cups and other on-the-go oatmeal products.