The marketing manager for Bake’n Joy says that the in-store bakery category holds a lot of potential for supermarket retailers
What is the state of the bakery category at retail? What is driving sales growth or decline?
Tara O’Donovan: The in-store bakery seems to be holding its own in overall supermarket performance. Customers today want to know they are getting a value from all departments, but we see this to be particularly true in the bakery. With incremental bakery sales being somewhat driven by impulse, it’s important to tantalize the customer with the image of freshness and value.
More shoppers are choosing to dine in. With this, the in-store bakery has a captive audience to offer smaller-portioned items and fresh baked goods that, in turn, give the shopper the feeling of bringing something special home. Offering bakery items that represent a value to customers is key. This means offering quality products are a reasonable value, not offering lower end products at the same or slightly lower cost. The product has to be good and it has to encourage repeat sales.
As retailers develop their bakery departments, what do they need to do to maximize sales?
Many things can be done to maximize sales, from reducing SKUs (and stales) and reducing labor-intensive items to beefing up sales incentives with promotions and merchandising.
Offering a quality product is the easy part. Finding the product that will bring in the highest sales at the least cost to the bakery is the difficult part. Manufacturers offering ready-to-bake items will help to reduce labor costs while maximizing profits with higher margins and potential for repeat sales. To offer a true value to shoppers, the product must be good and must be fresh.
Sampling is a great way to increase impulse sales and provides an excellent opportunity to introduce new products or flavors. A “featured flavor” program (i.e., for muffins), offers customers have an opportunity to try a product or flavor they have not tried before. Sampling, signage, display and weekly specials help to promote any “featured flavor” program.
What obstacles are there for retailers to overcome?
It’s important, and often difficult, to really know what your customers want. Beyond analyzing usage studies and sales of muffins over pastries, talk to your bakery customers and find out what they want. With a better handle on customer needs, the in-store bakery can reduce SKUs and offer items with a better chance of selling.
To be ahead of food trends, like whole grain or vegan, look to the shoppers to provide an inside look at future sales potential. Don’t be afraid to try something new in response to customer demand.
Tell us about what Bake’n Joy offers the retail bakery department.
We’ve been developing innovative products since our first bakery mix back in 1941. Much of our focus for the last 10-plus years has been on developing our frozen product categories with predeposited batters. By using a bake-off product that’s ready to go straight into the oven, the in-store can offer a freshly baked product with a minimum of preparation. Our FreshBakes line of “prescooped” muffins is offered in several sizes. Our PanFree line of loaf cakes, muffins, cupcakes and quarter sheet cakes require no special pans as they bake in their own upscale liners. With predeposited batters, there’s more time for decorating and adding toppings to increase eye appeal. We offer decorating and formula ideas as well as technical support. Customers have access to our marketing design team to help with merchandising and handling guides.
What is your “simple solution” to the in-store bakery?
Know your customers, reduce SKUs, maximize your labor force, offer value products, bake fresh and merchandise your offerings.
What does the future look like for the category?
We believe the future looks good for the in-store bakery. Shoppers will always have something celebrate, and they’ll turn to the in-store bakery for the items that are an integral part of the celebration. By staying on top of food trends (i.e. whole grains), the in-store is positioned to recapture customers who might be passing the bakery by or shopping somewhere else for niche items.
Again, value is key. Once shoppers determine they can get “more bang for their buck” at the in-store bakery, they will shop there. Customers will choose fresh-baked items over the commercial brands if they perceive the value to be higher.