The economic winds of change seem to be blowing people’s cookie-buying habits within in-store bakery (ISB) in strangely different directions at the moment. Buffeted by the storms of recession, shoppers have latched on to trusted brands, buying more licensed cookies, while at the same time jumping ship from ’premium’ products to better-value ’standard’ ranges.
Overall, the ISB cookie market is doing well - up 4% in value in the 52 weeks to 22 February 2009, according to TNS Worldpanel. "Cookies are a comfort food and, in difficult times, we want a treat," explains Simon Richardson, sales and marketing director at cookie supplier Rich Products. "They also represent good value. A pack of five standard cookies typically retails for around £1. That’s 20p a unit. Compare that to Danish pastries, where you might only get two for £1.40."
This emphasis on value has seen sales of premium cookies fall by 7.5%, while ’standard’ cookies are up 10.8%, according to the TNS data, supplied by Rich’s. At the same time, sales of licensed cookies have also climbed, with TNS estimating growth of 7.5%. This has been helped by supermarket promotions, which have increased the number of packs purchased, as well as new products from BakeMark UK, such as the Quality Street Mint Matchmaker Cookie and Kraft Toblerone Cookie.
The growth in licensed products can also be explained by the theory that, during tough times, people naturally fall back on trusted, familiar brands. This also appears to be happening in the packaged biscuit aisle. Sue Garfitt, head of insights, category and marketing planning at biscuit company Burton’s Foods, says people are searching out "nostalgic" brands for reassurance. "Cadbury Fingers is a case in point," she says. "It has seen a 14.2% increase in sales value and 4.7% increase in sales volume in the past year."
Back in the ISB, Tesco, Asda and Somerfield have all increased their share of the cookie market in the past 12 months, according to TNS. "The winners in the category have tailored their offer to target their consumers," says Richardson at Rich’s. "In the past, some retailers haven’t got their ranging right. A mid-market retailer, for example, would have almost as many premium stock-keeping units (skus) as in the standard tier of cookies. But if you’re a family retailer, you need a larger proportion of standard cookies, with targeted promotional offers. Asda and Tesco have done this really well. They have got that balance between premium, standard and branded cookies, and their promotions appeal to larger families."
Supermarket deals have helped push volumes up, but they are also having an effect in other retail channels. Coffee shops, which traditionally sell individual grab-and-go cookies, are starting to offer multipacks, says David Girdler, marketing director at Delice de France, owner of the Otis Spunkmeyer cookie concept.
"We are starting to see packs of two or four cookies in foodservice. Traditionally, cookies were bought to eat immediately, but now nearly half are bought to take home or back to the office. It reflects the current climate, with lots of offers on cookies in the supermarkets and the fact that people want more for their money."
To this end, Delice has recently started providing packaging for its Otis Spunkmeyer cookies, so that they can be offered in take- home multipacks.
Craft bakers are well-placed to take advantage of the current changes in cookie-buying trends because they can adapt their product range quickly. BakeMark UK, for example, supplies a product called Simply Scoop Cookie Dough, which comes in 5kg pails and can be used to make a range of different products. "Simply Scoop enables craft bakers to strengthen their image as a specialist on the high street," says David Astles, marketing manager. "They could use it to make a standard 50g cookie, which could be sold in a multipack, but equally if they’re doing a meal deal and want a lower-cost product, they could make a 40g cookie."
The dough could also be used to make mini-cookies, which Astles highlights as a recent trend in the ISB category. "We are starting to see more 25g cookies rather than the traditional 50g or 80g offerings," he says. "These are easier to eat on-the-go or share with others."
BakeMark supplies mini versions of its Readibake and licensed Smarties cookies, while Otis Spunkmeyer will launch two mini versions later this year. The trend is also driving growth in packaged biscuits, which are evolving into mini bagged snacks. Burton’s, for example, has launched mini versions of its Jammie Dodger biscuits called Splat Snacks.
When it comes to flavours, cookies are dominated by chocolate (see panel), but there is a growing use of nuts, fruit and seeds. "People are linking fruit with chocolate, so raspberry or cranberry with white chocolate has been successful. I think we’ll see more of these kinds of products in the future," says Richardson at Rich’s. Indeed, this already seems to be happening in packaged biscuits with Fox’s launching Chunkie Extremely Chocolatey Fruit & Nut Cookies in February.
Other new product development has seen Rich’s launch a range of filled cookies for ISBs, while Gill Hodgson, sales director at inclusions specialist Nimbus, says there is a growing trend for cookies that are styled on puddings or desserts. The company has been asked to develop inclusions such as bake-stable marshmallows, biscuit pieces and meringue for ’rocky road’ and pavlova-style cookies. "It’s a trend that started in ice cream and is now spreading to cakes and cookies," she says. "Overall the market is tending towards shorter runs on products, so there you now see ’cookie of the month’ or a product that is available for a single quarter."
The industry-wide move towards clean label and ethically sourced ingredients is also affecting cookies. Pullins Bakers in Somerset has recently launched a new range of cookies under the Oh Goodie brand, which uses Rainforest Alliance Certified cocoa, organic ginger and labels approved by the Forest Stewardship Council.
"Our target markets are coffee shops and grab-and-go retail," says brand manager Tristan Hunt. "Ethical sourcing is a particular concern in the coffee shop market in coffee, tea and sugar. But in food most only stock Fairtrade chocolate and not much else. We saw a gap in the market."
=== Chocs away ===
When it comes to cookie flavours, Simon Richardson at Rich’s says consumers tend to go for "chocolate, chocolate or chocolate".
The problem with this is that chocolate prices are currently at a record high with a tonne of cocoa costing around $2,650, compared to $1,700 two years ago. This is due to a shortfall in world production.
"Well over 80% of our cookie sales are with chocolate and, depending on contractual situations, we’ve seen a 10-30% increase in chocolate prices," says Richardson. "There have been some price increases in cookies in the past 18 months, but there’s no way we can continue to absorb the increases we are seeing in cocoa. It is inevitable that these will be passed on and that some of these will be passed on to consumers."