KANSAS CITY, MO — The cookie category continues to show its resiliency with the global cookie market expected to grow at a CAGR of 5.43%, according to Mordor Intelligence.
The importance consumers place on cookies translates into a category that sees little negative impact, even during a pandemic. They found even more traction when lockdowns and stay-at-home mandates further accelerated snacking behaviors.
In the 52 weeks ending May 15, center store, which dominated sales during the pandemic, saw sales of $8.3 billion, a 7.1% change vs. a year ago. Perimeter sales of $2.3 billion, a 17.6% change from a year ago, demonstrate the ongoing rebound after a period of closures and labor shortages.
In center store, traditional cookies saw $685 million in current sales and $113 million in current sales of assorted/multipack cookies. Traditional cookies recorded $1.5 billion in current sales in the perimeter, an impressive 15.6% change compared with a year ago.
Unit sales of perimeter traditional cookies were up 6.7%, and specialty cookies boasted $180 million in current sales. Iced/frosted perimeter cookies saw $338 million in current sales, an 18.2% change vs. a year ago.
Despite the hurdles of labor shortages and ongoing supply chain issues, the category shows tremendous strength. What remains to be seen is if cookies can successfully weather the inflationary shock inside the bakery and the changing consumer purchasing behavior.
A survey conducted in May by IRI found that 95% of consumers are concerned about rising prices, with 48% being very concerned.
“The widespread nature and height of inflation is pressuring spending for many consumers, including 38 percent who described their financial health as strained,” said Melissa Altobelli,
principal, strategic solutions group for IRI. “Thirty percent of American households stated they struggle to afford needed groceries.”
All indicators point to the fact that the category is well-positioned to not only survive but also thrive. Cookies are still in high demand despite an 8% price increase. Units are only down slightly, but Altobelli attributed this to out-of-stock products vs. true decline.
“Inflationary pressure can be seen in all food and beverage,” she said. “However, we do see that rewards or indulgent treat snacks are outpacing the categories of wellness and permissible snacking overall, and that is expected to continue.”
From the last two years, it’s evident that consumers rely on comfort through accessible indulgence more than ever. Those who set aside their baking mitts when mobility resumed are looking for new ways to get that fresh-baked fix.
Looking to fill the “almost-homemade” category in center store is Pillsbury’s new soft-baked cookies. The Minneapolis-based company, known for refrigerated cookie dough, now offers a shelf-stable version with no oven required. In the past year, the cookies have experienced tremendous growth with $91 million in sales and a 238% dollar sales change vs. last year.
Another category top-seller is Burlington, ON-based Voortman Bakery, a manufacturer of cookies, sugar-free products and wafers. Its products contain whole grain oats, coconut and almonds and are free from artificial flavors and colors, HFCS, and trans-fat.
Other popular varieties include chocolate chip, oatmeal, sugar and assorted. Sugar frosted, red velvet, snickerdoodle, gingerbread and M&M chocolate chip also show strong growth. Confetti is also finding some traction. Fun and flavorful confetti additions allow consumers to incorporate celebration and nostalgia into their cookie pleasure. Mintel found 72% of US consumers agree they enjoy things that remind them of childhood, and IRI research revealed that 67% of consumers look for fun-to-eat snacks.
Limited-time offers (LTOs) also capture consumer attention. Offerings from East Hanover, NJ-based Nabisco demonstrate consumers’ love of novelty with its Oreo LTOs in unique flavors such as Carrot Cake with cream cheese filling as well as holiday-related Oreos.
Cookie consumption spans across demographics, trending among larger families with children as well as seniors and Boomers. From a volume index perspective, households with more than five people index at 138, households raising teens at 132 and four-person households at 119.
Across all snack categories, multi/variety packs are up 26%, demonstrating the many benefits of on-the-go convenience and the desire of multiple family members to have the snacks they want with built-in portion control. The 25-oz. party-size varieties recorded unit sales of 294 million, and 30-oz. multipacks saw unit sales of 268.3 million.
Enhanced awareness of what one is eating is a lingering aftereffect of the pandemic, and it’s giving rise to greater demand for keto-friendly and grain-free cookies. Gluten-free is smaller but gaining in distribution and growth rates. Demands for zero- and no-sugar claims are also expected to expand in snacking, and could also be applicable to cookies. Items with vegan/vegetarian claims saw around 7% growth, accounting for less than 2% of cookie sales.
Protein is another important theme, as IRI found 41% of consumers “sometimes” look for high protein in their snacks, and 32% “always” or “usually” look for high protein. That said, claims for protein-enhanced cookies remain modest: $177.7 million in sales, a 2% dollar share of cookies and a 14.8% dollar sales change vs. a year ago.
“Consumers still prefer freshness over packaged, which was curbed when we had to cut grocery store visits,” JP Frossard, VP consumer foods analyst for Rabobank Group said. “On the other hand, center-store items are convenient. We remain optimistic with the perimeter perspectives and also reaffirm the need for the center aisle to compete directly with them.”
When it comes to opportunities in the category, Altobelli recommends capitalizing on snacking. Consumers are looking for variety through multipacks, ensuring everyone gets what they want, with the bonus of portion control.
This story was adapted from the August | Q3 2022 issue of Commercial Baking. Read the full story here.
