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The Fight to Win Your Breakfast Dollar




By Darren Rovell,CNBC Sports Business Reporter

NEW YORK (CNBC) --The fight is on to make your breakfast.

Why? Because it's the fastest growing segment of the quick service restaurant business.

Market research firm NPD Group says that 80% of morning meals are purchased from fast food establishments and research shows that people care less about the price of their breakfast than any other meal because it's so much about convenience and speed.

The way to a consumer's stomach might be through their coffee. Market research firm Technomic says that 33% of consumers who buy coffee are loyal to that brand or restaurant that sells it to them. That's up from 25% in 2009.

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Starbucks (SBUX) has boosted sales by selling more breakfast sandwiches and wraps to go along with its standard fare of bakery items.

Earlier this month, in order to get a bigger piece of the market, Dunkin' Donuts (DNKN) re-did its bagel recipe calling it a chewier, "artisan" bagel, testing the response to new flavors like sun dried tomato.

Fast food breakfast has come a long way since McDonald's (MCD) introduced its Egg McMuffin in 1971. Almost every fast food player is ready to serve breakfast by 6 a.m. Even Taco Bell, which had been a breakfast holdout, has joined the game, unveiling its "First Meal" menu in February.

While bacon, sausage and ham are the traditional breakfast meats, turkey and chicken are on the morning rise. Technomic data indicates that younger consumers are more likely to buy those non-traditional breakfast meats, which is a good sign for establishments like Chick-fil-A, which has been serving chicken in its breakfast since 2004. Last year, the privately held Atlanta-based company, which did $4 billion in sales, boldly started serving its spicy chicken biscuit during morning hours.

The fight to win your breakfast dollar is also very competitive in the supermarket. Ready-to-drink coffee sales are up more than 40%, with Starbucks dominating the marketplace. Single-cup coffee sales, driven by Keurig machines, are up more than 90%. The single- cup business is now a $600 million business, according to SymphonyIRI Group, a Chicago-based market research firm.

One of the fastest rising breakfast food categories are cereal and granola bars, which reached $5.7 billion in U.S. retail sales, according to Packaged Facts.



--Written by Darren Rovell at CNBC

CNBC is a world leader in business news, providing real-time financial market coverage and business information.

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