Salford was the latest council this month to ban biscuits at meetings, leaving a £30,000 hole in sales of bourbons, custard creams and Rich Tea. Luckily for cookie makers, the category looks likely to withstand such swingeing government cost-cutting ahead.
The cookie market in particular witnessed extremely good growth last year. In-store bakery (ISB) cookies were up over 10% in value and nearly a fifth in volume. "There has been a slight decline in total in-store bakery sales year-on-year, because ISB bakery is perceived as being more expensive than other areas of the store, so that’s not surprising," says Gail Lindsay, marketing manager of Rich Products. "But within that, ISB cookies have performed particularly well, up around 11% year-on-year."
While the average price per pack dipped below £1, the growth has not been primarily promotion-driven, she believes, attributing increased sales to more households buying into cookies. "We’ve done some promotional activity, but no more than previous years. It’s about buying more when they go into the store and buying more often."
Tesco, which has the largest market share of cookies, with 32.7%, carried out a significant amount of work on its standard cookies, with recipe reformulation (flavours and salt levels) and packaging changes, contributing to a 58% rise on its standard range.
"The supermarkets are getting better at catching that top-up shopping behaviour and that’s where the craft bakery market can really play a part, as a local shop, with a good range of products not by being left with nothing on-shelf and closing by 4pm in the afternoon." says Lindsay.
For those bakers looking to capitalise, there are lots of convenient options on the market. "Craft bakers who have not already caught on to the cookie craze may be wondering if they have missed the boat, but with value growth of around 11% in the market, there is still plenty of opportunity to take profitable advantage of the cookie trend," says David Astles of bakery ingredients supplier CSM UK (formerly BakeMark UK). With thaw-and-serve, choc chip versus double choc chip, soft and chewy, scoop doughs, healthy options, cookie mixes and cookie pucks, there’s a lot to consider. But one thing’s for certain retailers won’t go far wrong with standard choc chip flavours, which are runaway category leaders.
"With the documented sales of standard cookies showing a sustained growth within the market of 21% value and 29.9% volume (Kantar Superpanel, 52 w/e 27 December 2009), there is little evidence to suggest that this trend will be reversed, which means even those who are just starting out in the cookie market still have the potential to make good margins," says Astles.
One of CSM’s products that appears well-placed is its Readi-Bake better-for-you Apricot and Raisin Cookie, which has 53% less fat and 23% fewer calories than a standard choc chip cookie. Elsewhere, the giant biscuit bakers are leading the charge when it comes to marketing the reductions they have made in saturated fat a ripple-down effect that could have implications for all cookie and biscuit makers and retailers.
A big flash on packs of United Biscuits (UBUK) brands, such as McVitie’s, currently communicates its 50% sat fat reduction, backed by a big-money six-week campaign. "McVitie’s is now worth over £231m, and is expected to become even more popular now that the saturated fat has been reduced by a further 50% across the McVitie’s portfolio," says Sarah Heynen, marketing director, sweet biscuits at UBUK. "The campaign will tell consumers of the latest saturated fat reduction."
Brands hold off own-label
Packaged own-label cookies fell away badly compared with brands, seeing volumes drop nearly 15% and value down 3.5%. While volumes of branded cookies dipped too, down 3.8%, value held up well, boosting the branded cookies category by nearly 5%, with the average price paid per pack rising 5p. This has led to opportunities for brand-building with niche suppliers.
Cornish biscuit manufacturer Furniss of Cornwall has had its most successful year since the company was taken over by Proper Cornish Food Company in 2006. With a turnover of £2m in 2009, it is now targeting £3m for 2010. Products with a strong provenance, such as its clotted cream shortbread an alternative to traditional Scottish shortbread, as well as the launch of a Rick Stein-branded savoury biscuit range, have been making inroads into the category and have helped to build export sales.
"It has been successful for us, which is not to say the upper end of the savoury biscuit market is making a resurgence," says marketing manager Mark Muncey. "Not an awful lot of people are doing new product development at the moment, so the fact that we’ve got something new is appealing. Certainly for the independents, what with Duchy Originals’ new arrangement to supply Waitrose, we are now selling into places that were happy with Duchy. We’re putting some money into new ideas, while the market is stagnating, to steal a small part of a very large market."
What next for cookies?
Cupcakes versus fairy cakes, cookies versus biscuits, frosting versus icing... America is winning the transatlantic bakery battle and US-style cookies characterised by a large diameter and a soft, chewy texture are now within our borders. For inspiration from overseas, here are our top three cookie-makers cutting it Stateside
1. Bringing your unspoken childhood dinner-reordering fantasy to fruition with the motto Eat Dessert First, Eleni’s in New York features novelty shaped cookies, made using bespoke cutters and iced by hand. Themes range from sports cookies to Oscars night celebrity cookies. When Eleni’s made Obama cookies during the 2008 Presidential race, election day reportedly saw its best-ever one-day takings. With a UK election likely on 6 May, would Gordon "anything with chocolate" Brown biscuits be a winner? elenis.com
2. Can’t be bothered to come up with new recipes? Then let your customers decide! In Canada, the consumer is king at Toronto’s Sweet Flour Bake Shop, which has devised a way to bake them in just two minutes. Closer to an ice cream shop in spirit, you can create up to 15,000 combinations of cookie, with 23 dough mixes, from M&M’s to dried fig, and six choices of spread to sandwich your cookie. Healthy options include fresh fruit, yoghurt and granola to mix in. www.sweetflour.ca3.
"Possibly the largest, most divine chocolate chip cookies in Manhattan" is the quote from The New York Times, flaunted on Levain Bakery’s website. The 6oz cookies look more akin to a scone or a rock cake. Online orders for the mix-and-match chocolate chip walnut, dark chocolate chocolate chip, oatmeal raisin and dark chocolate peanut butter chip cookies come wrapped in cellophane and topped with a blue ribbon. Also on offer is a 12-cookie gift box for $66.