Brands in the instore bakery are in a strange place, says David Skinner, marketing manager at Omaha, Nebraska-based James Skinner Baking Co.
Private label baked goods are no longer mired in an unflattering reputation and consumers are increasingly reaching for unbranded products.
It begs the question: why do instore bakeries even need an outside brand in their store? Where does an outside brand fit in?
“All retailers are handling this evolution in a different manner,” Skinner says. “The biggest influencers right now that determine what major retailers are carrying is the rise of limited assortment stores and tiered private label brands.”
Whether it’s a full-blown marketing campaign or a quirky niche brand with fun packaging, he says, an outside brand in the instore bakery presents a new, different experience for the consumer and an incremental sale opportunity to the retailer.
Brands offer new experiences
With the growth of Aldi and Trader Joe’s, retailers began viewing their own products in a new light.
“They saw success with this sort of sliding scale version of private label,” Skinner says, mentioning the bare bones, ultra-value products of Aldi and the extravagant Trader Joe’s offerings that can go toe-to-toe with any major brand. “All of the sudden, private label and store brands didn’t need to be boring, sub-par offerings.”
Many of the largest retailers responded to this trend by making private label and store-baked products most of their inventory, but the move wasn’t turnkey. They then began to differentiate their private label offerings, generating different tiers of quality, as well as organic lines.
Now, with retailers finding success with their own brands, what can branded baked goods offer?
“The answer is that although they have the spectrum covered, different brands present different identities and garner different emotions from the consumer which presents different purchase opportunities for the retailer,” Skinner says. “In a sea of private label clamshells, a branded product stands out as something unique and premium.”
Tim Boote, marketing director for St. Pierre Bakery — headquartered in Manchester, England — says when consumers go to the bakery section, they are typically looking for products they can’t get in the bread aisle.
“When consumers see branded products in the instore bakery, they make the connection that these are specialty products or premium items,” he says. “I think once people start to recognize your products are in this instore bakery, they know to look for them there.”
Branded products lend themselves to prime cross-merchandising opportunities, especially when focusing on eating occasions and events.
“Many of our products fall into breakfast bakery category, so we’ve seen many successful instances of our product displayed at endcaps near dairy, eggs, and breakfast meats,” says Skinner.
Boote also points out that many of St. Pierre’s products — muffins and croissants, for example — go well near other breakfast foods, but are also good fits around snack foods. Individually-wrapped items like crepes and waffles work well near other snackable items, especially during back-to-school season, he says. An ideal spot might be an endcap with snack-size chips and granola bars in a shipper in the snack aisle.
“We also like the idea of featuring individually wrapped bakery items in the deli section and near the prepared foods to encourage impulse buys,” Boote says. “Having a basket of individually-wrapped waffles near the deli area can be a great way to drive sales during the lunch hour when it’s busy and people are hungry.”
Seasonality and holidays also provide ideal cross-merchandising times. During grilling season, St. Pierre recommends placing its burger buns and slider rolls near the fresh meat department. Meanwhile, J. Skinner’s cornbread goes hand-in-hand with BBO, prompting some retailers to merchandise it on the butcher’s perimeter.
A helping hand
Instore bakeries are sometimes limited, either by employee skill and experience or by budget, in what they can produce on site. A brand partner can help with those hard-to-perfect products.
“Our Danish dough, which is the base of many of our offerings, is very difficult and time consuming to emulate efficiently at an instore bakery level,” Skinner says. “We’ve always prided ourselves on our 108-layer Danish dough. As a brand, that’s the easiest and most impactful attribute to communicate to consumers, but in all reality it’s what we do after we’ve laminated the dough that makes the difference in taste.”
That includes allowing the doughs to rest in a temperature-controlled room for at least 24 hours, a process that regulates the speed at which fermentation occurs and generates the signature flavors of the dough.
“You’ll see many products out there labeled as Danish, but to our knowledge, we’re the only instore bakery supplier that uses this process. In addition, all our products are thaw and sell which is hard to beat from a labor and efficiency standpoint,” Skinner says.
Other products simply take too much time or are too labor intensive, Boote says.
“I think many of our products can be a challenge for instore bakeries, especially if they are scratch-baking them,” he says. “We’re able to provide classic European style bakery items like lace thin crepes, traditional Liege style waffles and chocolate croissants that might otherwise pose a challenge to instore bakeries.”