Table of Contents
Introduction
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- Definitions
- Abbreviations
Executive Summary
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- The market
- Forecast
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- Figure 1: UK retail value sales of breakfast cereals, 2006-16
- Market factors
- The breakfast occasion is hotly competed
- Cold winters drive hot
- Questions about healthiness of cereals raised by the media
- Cost pressures drive up prices
- Companies, brands and innovation
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- Figure 2: Market share of breakfast cereals, by brand, 2010
- New healthy innovation in the children’s segment
- The presence of major players drives high ad spend
- The consumer
- Nine in ten adults eat breakfast cereals
- Sugar and fibre content are top choice factors
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- Figure 3: Factors taken into consideration when choosing breakfast cereal, June 2011
- Newness can engage half of cereal eaters
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- Figure 4: Attitudes towards breakfast cereals, June 2011
- Packaging sparks consumer interest
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- Figure 5: Agreement with the statement, “I would prefer my cereal to have less packaging”, June 2011
- What we think
Issues in the Market
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- Do breakfast cereals need to improve their health image?
- What impact are Ofcom’s regulations having on the market?
- How can more men be attracted to porridge?
- Is there further potential for more indulgent cereals?
Future Opportunities
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- Trend: Make it Mine
- Trend: Many Mes
Internal Market Environment
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- Key points
- Fibre enjoys strong appeal...
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- Figure 6: Agreement with the statement “I try to include plenty of fibre in my diet these days”, by age group, 2010
- … although interest in many health considerations is decreasing
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- Figure 7: Agreement with the statement “I am prepared to pay more for foods that don’t contain artificial additives”, 2006-10
- Average working hours in decline
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- Figure 8: Trends in average working hours, per day, 2006-10
- Big freeze(s) benefit porridge
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- Figure 9: Mean winter* temperatures, UK, 2006-10
Broader Market Environment
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- Key points
- Oat and wheat prices leap
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- Figure 10: Weekly prices of cereals, England and Wales, January 2008-May 2011
- Milk prices dip under supermarket competition
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- Figure 11: RPI for fresh milk, January 2008-April 2011
- Nutrient Profiling Model presents an ongoing challenge
- Demographic changes affect the market
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- Figure 12: Projected trends in the UK population, by age group, 2011-16
- Figure 13: Consumer Confidence Index, monthly, January 2007-May 2011
Competitive Context
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- Key points
- Toast poses strong competition to cereals at breakfast
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- Figure 14: Breakfast items eaten in the home, June 2011
- … and has the weight of the bread market behind it
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- Figure 15: UK value sales of selected foods competing with breakfast cereals, 2006-10
- Fruit has limited but healthy appeal
- Younger consumers choose cooked breakfast
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- Figure 16: Cooked breakfast consumption, by age group, June 2011
- Modern offerings have youth appeal
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- Figure 17: Selected items eaten for breakfast at home, 16-24-year-olds, June 2011
Strengths and Weaknesses
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- Strengths
- Weaknesses
Who’s Innovating?
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- Key points
- Weetabix and Kellogg’s crack the NPM code with chocolate innovation
- Kellogg’s ups efforts in NPD
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- Figure 18: New product development in the UK cereals market by top 20 companies, January 2008-May 2011*
- … but Weetabix reduces the number of launches
- Cereal gets chocoholic
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- Figure 19: New product development in the UK cereals market, top ten flavours, 2009 and 2010
- Cold cereals dominate NPD
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- Figure 20: NPD in UK breakfast cereals, cold vs hot cereals, 2008-11
- … as hot cereals enhance instant appeal
- Own-label NPD on the up
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- Figure 21: New product development in the UK cereals market, by private-label, 2009-10
- Porridge gets an urban makeover
Market Size and Forecast
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- Key points
- Cereal sales plateau
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- Figure 22: UK retail value and volume sales for total breakfast cereals, 2006-16
- Sales dip in 2010
- Cold cereals in modest growth
- Big freeze factor
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- Figure 23: Hot cereal sales value vs mean winter temperature, 2006-10
- The future of the market
- Breakfast cereal market forecast
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- Figure 24: Value sales for total breakfast cereals, 2006-16
- Forecast methodology
Segment Performance
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- Key points
- Cold cereals
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- Figure 25: UK retail value sales of cold and hot breakfast cereal, 2006-11
- Hot cereals
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- Figure 26: Year-on-year % change in cold and hot breakfast cereal market values, 2007-11
- Cold cereal volume sales under pressure
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- Figure 27: UK retail volume sales of cold and hot breakfast cereal, 2006-11
Market Share
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- Key points
- Special K is the biggest brand
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- Figure 28: Market share of breakfast cereals, by brand, 2010
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- Figure 29: Market share and sales value of breakfast cereals, by brand, 2008-10
- Porridge power
- Dorset’s solid sales
- Own-label plays a limited role in breakfast cereals
Companies and Products
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- Figure 30: Selected leading companies in the breakfast cereal market in the UK and their brands, 2011
- Kellogg’s
- Corn Flakes
- Special K
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- Figure 31: New product development by Kellogg’s, January 2010-May 2011
- Coco Pops
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- Figure 32: New product development by Kellogg’s, January 2010-May 2011
- Weetabix
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- Figure 33: New product development by Weetabix, January 2010-May 2011
- Alpen
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- Figure 34: New product development by Weetabix, January 2010-May 2011
- Dorset Cereals
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- Figure 35: Key new product development by Dorset Cereals, January 2010-May 2011
- Jordans
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- Figure 36: Key new product development by Jordans, January 2010-May 2011
- Cereal Partners
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- Figure 37: New product development by Cereal Partners, January 2010-May 2011
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Brand Research
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- Brand map
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- Figure 38: Attitudes towards and usage of breakfast cereal brands, June 2011
- Brand attitudes
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- Figure 39: Attitudes by breakfast cereal brand, June 2011
- Brand personality
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- Figure 40: Breakfast cereal brand personality – macro image, June 2011
- Figure 41: Breakfast cereal brand personality – micro image, June 2011
- Correspondence analysis
- Brand experience
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- Figure 42: Breakfast cereal brand usage, June 2011
- Figure 43: Satisfaction with various breakfast cereal brands, June 2011
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- Figure 44: Consideration of breakfast cereal brands, June 2011
- Figure 45: Consumer perceptions of current breakfast cereal brand performance, June 2011
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- Figure 46: Breakfast cereal brand recommendation – Net Promoter Score, June 2011
- Brand index
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- Figure 47: Breakfast cereal brand index, June 2011
- Figure 48: Breakfast cereal brand index vs. recommendation, June 2011
- Target group analysis
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- Figure 49: Target groups, June 2011
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- Figure 50: Breakfast cereal brand usage, by target groups, June 2011
- Group One – The Conformists
- Group Two – Simply the Best
- Group Three – Shelf Stalkers
- Group Four – Habitual Shoppers
- Group Five – The Individualists
Brand Communication and Promotion
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- Key points
- Ad spend remains steady
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- Figure 51: Topline advertisement spend in the UK breakfast cereals market, 2006-10
- Kellogg’s dominates but Weetabix punches above its weight
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- Figure 52: Advertisement expenditure in the UK cereal market, by top 10 companies, January 2009-March 2011
- Ofcom rules hit TV and press
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- Figure 53: Advertisement expenditure in the UK cereal market, by media type, January 2009-March 2011
Channels to Market
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- Key point
- The multiples dominate the cereal market
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- Figure 54: UK retail value sales of breakfast cereals, by outlet type, 2008-10
Consumer – Breakfast Cereals Usage
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- Key points
- Breakfast cereal has widespread appeal
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- Figure 55: Trends in frequency of using breakfast cereals, 2009-10
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- Figure 56: Frequency of use of breakfast cereals, men vs women, 2010
- Families are the most likely to use cereals
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- Figure 57: Frequency of using breakfast cereals, by lifestage, 2010
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- Figure 58: Overall and heavy usage of breakfast cereals, by age of children in the household, 2010
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- Figure 59: Frequency of using breakfast cereals, by age group, 2010
Consumer – Types of Breakfast Cereal Eaten
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- Key points
- Old favourites like cornflakes and porridge dominate consumption
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- Figure 60: Types of breakfast cereal eaten, June 2011
- Wholegrain divides the age groups
- Bran lags behind
- Low-fat cereal consumption rises with affluence
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- Figure 61: Usage of low fat breakfast cereals, by gross annual household income, June 2011
Consumer – Choice Factors
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- Key points
- Sugar is top concern
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- Figure 62: Factors taken into consideration when choosing breakfast cereal, June 2011
- Sugar level is the most common consideration
- Women are more health-led than men in cereal choices
- Men are more likely to prioritise brand
- Health considerations rise with wealth and age
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- Figure 63: Importance of sugar, fibre and fat content as factors when choosing breakfast cereal, by selected socio-economic groups, June 2011
- Natural and organic are low priorities
Consumer – Attitudes Towards Breakfast Cereals
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- Key points
- Consumers are not wanting for choice…
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- Figure 64: Attitudes towards breakfast Cereals, June 2011
- Packaging proves a sticking point
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- Figure 65: Agreement with the statement, “I would prefer my cereal to have less packaging”, June 2011
- Own-label vs branded quality
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- Figure 66: Agreement with the statement, “own-label cereals are no different from the branded ones”, June 2011
- Nutrition information an important feature
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- Figure 67: Agreement with the statement “I check out nutritional information on cereals before I buy” by gender, June 2011
- Multipacks face challenges
Consumer – Target Groups
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- Key points
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- Figure 68: Target groups based on attitudes towards breakfast cereals, June 2011
- Traditionalists (20%)
- Experimenters (26%)
- Own-label Fans (26%)
- Brand Buyers (28%)
Appendix – Internal Market Environment
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- Figure 69: Agreement with selected lifestyle statements on diet and health, 2006-10
- Figure 70: Agreement with selected lifestyle statements on diet and health, by demographics, 2010
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- Figure 71: Trends in frequency of using breakfast cereals, 2009-10
- Figure 72: Frequency of using breakfast cereals, by demographics, 2010
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- Figure 73: Trends in average working hours, 2006-10
- Figure 74: Mean winter* temperatures, UK, 2005-10
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- Figure 75: Weekly prices of cereals, England and Wales, January 2008-May 2011
- Figure 76: RPI for fresh milk, January 2008-April 2011
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Appendix – Competitive Context
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- Figure 77: Most popular items eaten for breakfast in the home, by demographics, June 2011
- Figure 78: Next most popular items eaten for breakfast in the home, by demographics, June 2011
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- Figure 79: Other items eaten for breakfast in the home, by demographics, June 2011
- Figure 80: Most popular items eaten for breakfast out of the home, by demographics, June 2011
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- Figure 81: Next most items eaten for breakfast out of the home, by demographics, June 2011
- Figure 82: Other items eaten for breakfast out of the home, by demographics, June 2011
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- Figure 83: Competing products with breakfast cereals, by sales value, UK, 2006-10
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Appendix – Who’s Innovating?
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- Figure 84: New product development in the UK cereals market by top 20 companies, January 2008-May 2011*
- Figure 85: New product development in the UK cereals market, by flavour, 2009 and 2010
- Figure 86: New product development in the UK cereals market by sub-category, January 2008-May 2011
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- Figure 87: New product development in the UK cereals market by private label, January 2008-May 2011
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Appendix – Market Size and Forecast
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- Figure 88: Forecast of value sales for total breakfast cereals, 2006-16
- Figure 89: UK retail value and volume sales for total breakfast cereals, 2006-16
- Figure 90: Additional best case/worst case table for breakfast cereals, 2011/16
- Figure 91: Forecast of UK retail sales of cold cereals, by value, 2006-16
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- Figure 92: Value sales for cold breakfast cereals, 2006-16
- Figure 93: Forecast of UK retail sales of hot cereals, by value, 2006-16
- Figure 94: Value sales for hot breakfast cereals, 2006-16
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Appendix – Market Share
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- Figure 95: Market share and sales value of breakfast cereals, by brand, 2008-10
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Appendix – Segment Performance
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- Figure 96: UK retail value sales of cold and hot breakfast cereal, 2006-11
- Figure 97: UK retail volume sales of cold and hot breakfast cereal, 2006-11
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Appendix – Brand Research
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- Figure 98: Brand usage, June 2011
- Figure 99: Brand commitment, June 2011
- Figure 100: Brand diversity, June 2011
- Figure 101: Brand satisfaction, June 2011
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- Figure 102: Brand recommendation, June 2011
- Figure 103: Brand attitudes, June 2011
- Figure 104: Brand image – macro image, June 2011
- Figure 105: Brand image – micro image, June 2011
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- Figure 106: Profile of target groups, by demographics, June 2011
- Figure 107: Psychographic segmentation, by target group, June 2011
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- Figure 108: Brand usage, by target group, June 2011
- Figure 109: Brand index, June 2011
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Appendix – Brand Communication and Promotion
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- Figure 110: Topline advertising expenditure in the UK cereal market, January 2006-March 2011
- Figure 111: Advertising expenditure in the UK cereal market, by product sub-category, January 2009-March 2011
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- Figure 112: Advertising expenditure in the UK cereal market, by media type, January 2009-March 2011
- Figure 113: Advertising expenditure in the UK cereal market, by top 10 companies, January 2009-March 2011
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Appendix – Channels to Market
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- Figure 114: UK retail value sales of breakfast cereals, by outlet type, 2008-10
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Appendix – Consumer – Breakfast Cereals Usage
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- Figure 115: Frequency using breakfast cereals, by demographics, 2010
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Appendix – Consumer – Choice Factors
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- Figure 116: Most popular important factors when choosing breakfast cereal, by demographics, June 2011
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- Figure 117: Next most popular important factors when choosing breakfast cereal, by demographics, June 2011
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- Figure 118: Other important factors when choosing breakfast cereal, by demographics, June 2011
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Appendix – Consumer – Types of Breakfast Cereal
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- Figure 119: Most popular types of breakfast cereal eaten, by demographics, June 2011
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- Figure 120: Next most popular types of breakfast cereal eaten, by demographics, June 2011
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Appendix – Consumer – Attitudes Towards Breakfast Cereals
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- Figure 121: Agreement with the statements ‘I get bored of eating the same cereal every day’ and ‘Own-label cereals are no different from the branded ones’, by demographics, June 2011
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- Figure 122: Agreement with the statements ‘I only buy branded cereal (eg Kellogg’s Corn Flakes)’ and ‘I often don’t have time for breakfast at home’, by demographics, June 2011
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- Figure 123: Agreement with the statements ‘I give my children dry breakfast cereal as a snack’ and ‘I tend to eat my breakfast cereal with fresh fruit or yogurt’, by demographics, June 2011
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- Figure 124: Agreement with the statements ‘I use breakfast cereals as an ingredient in cooking/baking’ and ‘I use breakfast cereals as a dessert topping’, by demographics, June 2011
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- Figure 125: Agreement with the statements ‘I have eaten the same cereal since I was young’ and ‘I think there is enough choice in the breakfast cereal aisle’, by demographics, June 2011
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- Figure 126: Agreement with the statements ‘There is enough choice for me to always find the cereal I want’ and ‘I often like to try out new cereals’, by demographics, June 2011
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- Figure 127: Agreement with the statements ‘I would prefer my cereal to have less packaging’ and ‘I check out nutritional information on cereals before I buy’, by demographics, June 2011
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- Figure 128: Agreement with the statement ‘Individual multipack cereal boxes are too small’, by demographics, June 2011
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Appendix – Consumer – Target Groups
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- Figure 129: Target groups, by demographics, June 2011
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