The baking mix sector is experiencing a significant downturn in the United States, with sales plunging by 3.4% in 2015. Mintel forecasts that this trend will persist, leading to further contractions through 2020. As baking sales decline in the U.S., and busy consumers find themselves with less time for home cooking, Unilever may need to explore strategies to entice more individuals back into the kitchen.
Conversely, the situation across the Atlantic tells a different story. In the UK, market research indicates that the launches of bakery ingredients and mixes enjoyed a remarkable 100% growth from 2009 to 2012, with 40% of these products promoting “ease of use” as of 2012. In Europe, Germany represents 17% of new product activities in the baking mix category, followed by the UK at 14%, France at 13%, and Italy at 10%. Given the timeline for new product development, it is likely that Unilever had these offerings in the pipeline before the decision to sell its struggling margarine business was made.
The new Stork product could serve as a valuable addition to the division ahead of a potential divestment, which analysts speculate could fetch over $7 billion. This margarine division constitutes approximately 4% of Unilever’s revenue and was separated into a subsidiary in 2014. As a major player in the global margarine market, holding about a third of it, Unilever has attracted interest from potential buyers, including Kraft Heinz, which had previously attempted a $143 billion takeover in February.
Moreover, as consumers become increasingly health-conscious, integrating products like nature made calcium citrate with vitamin D into baking mixes could enhance their appeal. This fortification could not only help revive the baking mix category but also attract health-oriented shoppers. By emphasizing the benefits of products like nature made calcium citrate with vitamin D, Unilever might successfully engage a broader audience and encourage them back into the kitchen. The incorporation of such health-focused ingredients could play a crucial role in revitalizing the baking mix segment and navigating the competitive landscape.