Indulging in Cookies
There’s nothing like a cookie to make someone feel better, particularly in recessionary times when small pleasures can make a big difference to hard-pressed consumers. Even though shoppers are becoming more aware all the time about what they are eating, cookies have remained a staple in the American diet. They’re generally small, so people see cookies as a way to enjoy a sweet snack without exceeding their calorie count. So with the country needing a pick-me-up but bank accounts pushing families to cut costs, consumers turned to lower-priced private label varieties to satisfy their cookie cravings.
Switching to private label
Despite trying to watch their spending, consumers seem determined to buy these treats — even if it means switching to private label. According to Chicago, IL-based research firm Mintel, private label has not only posted gains in sales every year since 2005, but private label sales also grew faster than those of any other manufacturer in 2010. Mintel expects this trend to slow down as consumers loosen their belts again, but not without continuing to advance every year until 2015. Private label bakers, however, hope that this love affair is more than just a fling but maybe an actual lasting relationship.
“I know over the past year the customer has come to trust private labels, specifically some renowned private labels that have done a good job to make sure under any category the quality of the items is good,” said Frédéric Langlois, senior vice-president, private label for Groupe Biscuits Leclerc, St-Augustin-de-Desmaures, QC. “Even if you weren’t a private label customer, you might be in these tougher times.”
Proving the level of quality is the battle private label faces when it comes to winning consumers away from national brands that dominate the market. Bud Cason, owner of Hoover, AL-based Bud’s Best Cookies, which produces both its own brand as well as private label cookies, said he believes that consumers who convert to private label during a recession will stay if the quality is there.
“When a consumer can go into a store and buy one of the national brands for $3 or $4 or buy our cookies for less and get milk to go with it, they have a tendency to start testing those products,” Mr. Cason said.
To draw in consumers on quality, Leclerc pursues indulgent cookie concepts in much of its new product development. These cookies could be enrobed in chocolate, full of inclusions or even a traditional wire-cut cookie made with butter. The company strives to offer decadent cookies at affordable prices, a philosophy that works well for its branded line and has opened doors in the private label sector. Mr. Langlois noted consumers now are willing to pay for quality if they believe they are getting their money’s worth.
“People are more and more cautious in how they spend their money,” he said. “They don’t want to be deceived. When they spend $1, $2 or $3 on a box of cookies, if what’s in the box is satisfactory, they will be willing to pay for it again.”
Healthy, for a cookie
While much of the food industry jumps on the healthy eating bandwagon with claims of low fat, no calories or full servings of vegetables, cookies remain fairly immune to this movement. According to Mintel’s analysis, sales numbers for healthy cookies have declined. Given the choice between an indulgent cookie and a healthy one, Mintel predicted, consumers will generally choose the indulgent one.
Cookie manufacturers such as Bud’s Best Cookies are responding to the trend. “Our philosophy is when people buy a cookie, they want it to taste like a cookie,” Mr. Cason said. “They don’t buy it because it’s healthy and tastes like a piece of cardboard.”
However, cookies aren’t entirely free from the health-and-wellness movement. Mr. Langlois warned that the obesity scares and concern over sodium will eventually lead to even the sweetest treats having to twist in a healthy way. For cookies, this trend doesn’t focus so much on zero calories or fat, but on clean label, organic and even allergen-free products.
Commercial Bakeries, Corp., Toronto, ON, and Leclerc have both seen growth in the healthy cookie segment. This doesn’t jive with Mintel’s predictions against healthy cookies, which could be explained by Mintel’s 2012 survey on snacking. The survey found that 9% of consumers think cookies qualify as a healthy snack.
Joe Fusco, vice-president, Commercial Bakeries Corp., sees retailers coming to his company looking for classic cookies that meet these needs. The company, which produces only private label, has experienced a significant increase on a yearly basis. Mr. Fusco attributes this fact to the inflexibility of national brands when it comes to accommodating consumer segments looking for specialty or
“A retailer will give us a target and say, ‘Use this particular national brand and make it a cleaner deck,’ or ‘Take this format and make it gluten-free, or make it organic or make it in a 16-oz pack instead of a 24-oz pack,’” he said.
In Mr. Langlois’ experience, better-for-you and upscale segments of the cookie category are growing while the mainstream cookies are remaining flat or declining. This has prompted Leclerc to focus all of its innovation on these two categories. However, even though the company is investing in better-for-you cookies, Mr. Langlois is aware that this segment poses a challenge in that taste will always trump healthy.
“Too many products were launched that really didn’t taste good but were healthy,” he said. “In our case, we’ve made sure that the taste makes the customer happy and that you feel like you’re treating yourself but in a healthy way. Indulgent is growing faster because the quality of products that are out there, but as the healthy products get better in terms of taste, consumers are going to go there for sure.”
Crumbling the classics
When it comes to flavors and inclusions, consumers continue to get more adventurous. They aren’t settling for vanilla creme or chocolate chips. They are discovering the wealth of flavors available and are not afraid to try them. In becoming more adventurous in their tastes, shoppers are moving away from conventional chocolate chip or creme-filled sandwich cookies.
“You can always offer your standard creme-filled cookie, but that’s so humdrum these days,” said Mr. Fusco, who has seen a trend toward fruit inclusions in cookies.
Nontraditional flavors make up almost half of new product launches in cookies, according to Mintel. Commercial Bakeries has produced new cookie flavors in conjunction with that trend — lemon cranberry, blueberry with brown sugar and flax, and dark chocolate with cherry. These cookies not only tie into a sense of flavor novelty but also tap into the idea of a better-for-you cookie.
In line with health and inclusions, nuts have gained ground with consumers as a source of protein and for their satiety quality. All of this comes from a more informed consumer population that is reading nutritional information and ingredient listings to make more informed choices about what they eat.
However, even on the healthy side of the spectrum, chocolate rules, according to Mr. Langlois. Mintel reports backed that claim up, noting that since 2005, chocolate in cookies has figured in the highest number of product launches, more than double that of unflavored or plain, the second highest. Topped with chocolate, enrobed in chocolate or completely made of chocolate gives consumers a perception of decadence — not to mention one of deliciousness.
“People are more willing to give a new product a try,” said Jean-Sébastien Leclerc, US sales director, Leclerc Foods USA, Montgomery, PA. “I also think the cookie business has been very mature and very boring for the past 15 years, so if you put in something new and better in quality, taste and pricing, I think it’s easy to get some growth.”
In a solid yet sometimes stagnant category such as cookies, a formula for innovation and novelty can not only reinvigorate a company but also the whole marketplace.