A recovery for bacon sales?

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Bacon is a popular and versatile red meat product and GB volume sales appear to be on the rise, but what factors are contributing to this increase?

Over 40,000 tonnes of bacon were sold by GB retailers in the 12 weeks ending 1 January 2017, up by around 6% on the same period in the previous year, according to Kantar Worldpanel data. Sales were helped by falling prices, which restricted the growth of the category in value terms to 0.6% in the same period. This represents a recovery for bacon from the early part of the year, when the category was falling in both value and volume terms. This meant that over the year as a whole (52 weeks), bacon volumes were up 0.5%, with prices falling by 7% compared to the previous year, to £5.76kg.

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At the start of 2016, bacon sales were lower than the previous year. The publication of a World Health Organisation report (which suggested an increased relative risk of colon cancer due to high levels of red and processed meat consumption) may have contributed to a worsening consumer perception of bacon. However, the AHDB/YouGov Consumer Tracker has since registered a three percentage point decrease in the number of consumers who perceived sausages and bacon as not good for you, between January and October 2016. This suggests that concern about these products is subsiding.

Retailers are increasingly moving towards an everyday low price strategy for bacon, replacing the previously popular volume driving Y for £X promotions. This is a trend which has been observed across meat, fish and poultry categories, as the top four grocers attempt to compete with the hard discounters.

Despite this change of strategy, the hard discounters continue to see the most significant growth, with volumes up 18% in 2016 compared to the previous year. Three of the top four grocers showed reductions of over 4% in volume sold. The hard discounters are particularly successful in this category, as their share of the overall grocery market is much lower. It should be acknowledged that the hard discounters currently account for approximately 16% of the total volume of bacon sold in GB, in contrast to 57% by the top four.

In the food service sector, total bacon servings out of home have remained static for the year ending September 2016, compared with the previous year, according to data from NPD Crest. Bacon sandwiches have performed particularly well, with servings increasing by 5% at breakfast occasions and by 4% as a morning snack in the same period. This supports the finding that the morning meal has become an increasingly important meal occasion for the out-of-home industry.

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Emily Beardshaw, Trainee Analyst

emily.beardshaw@ahdb.org.uk, 02476478756