Our 2013 State of the Industry report explores market information for the bread aisle, sweet goods, cookies, bars, snack cakes, frozen baked goods, tortillas, pies and more.

Some sweet goods and snack-cake manufacturers are zooming by their competitors by consistently delivering products that meet consumer demand for bite-size portions, gluten-free formulations and high-quality ingredients.

Sweet goods and snack cakes are guilty pleasures for many people. They know these treats can often be filled with calories, sugar and less-than-nutritious ingredients. Still, they find it impossible to eat just a few bites of their favorite cake or half of a two-serving brownie.

Cognizant of the challenges their products may offer people low on willpower, seeking better-for-you treats or desiring quality rather than quantity, bakers are looking at today’s consumer trends and are shifting into high gear by rolling out goods worthy of the winner’s circle.

Bite-size champs

“We’re still really driven by bite-size, smaller portions and immediate consumption,” says Brian McGuire, president of Ticklebelly Desserts, a Steven Roberts Original Desserts brand. “Consumers are still looking for indulgence, but without overindulging on calories.” The Denver company’s innovative gourmet creations, which it sells to retail and foodservice customers, include cupcakes, dessert shots, cheesecake, brownie pops, cake pops, molten lava cakes and the recently introduced Cakebabies.

“The Cakebabies are just getting ready to ship,” McGuire says of the one-bite treats that debuted at the 2013 Winter Fancy Food Show. “They’re kind of unique—the shapes that we came up with and the [flavors]. They’re like miniature cakes.”

Cakebabies come in four flavors—Coconut, Triple Chocolate, Sea Salt Caramel and Red Velvet—and will be available in single-flavor six-packs in in-store grocery bakeries nationwide. McGuire adds that they eventually will be sold at some high-end retail outlets expanding into food.

Another new platform for Ticklebelly is Cake Pops, small orbs of dark chocolate, white or vanilla cake on sticks that are dipped in a coating and covered in a variety of toppings. Available in Chocolate Velvet, Strawberry Short, Celebration and Cookies & Cream, the spherical treats will be sold in single-flavor four packs at in-store bakeries nationwide.

“I think classical dessert shapes and designs are changing,” says McGuire. “People are looking for a little bit of the ‘wow’ in the design, delivery vehicle and manner in which they consume [a product]. From [products] on-a-stick to an individualized, bakeable pan, there’s a uniqueness going on in shape and design. I don’t think nostalgic looks are as hot as they used to be. [Consumers] want something from the jewelry case—that’s not that high-end—but different shapes and some angles. We’ve been going from the round pops to cylinders to triangles to entirely custom pans that are a little bit more angular.”

As for where consumers can find Ticklebelly’s treats, McGuire says, “We’ve primarily been located in the in-store bakery, but now we’re looking at the coffee, deli and frozen [sections] for potential expansion. Desserts are becoming incremental up-sells on many items. Those are categories that we’re looking to do in the future.”

Becky Henke, vice president of food for Swiss Colony Retail Brands, Monroe, Wis., agrees that the bite-size trend is continuing. “That’s what we’re getting questions about—one- or two-bite desserts consumers can serve or have as special indulgence,” she says. “Customers are looking for the convenience aspect as well. These really fit our core competency at Swiss Colony within our bakery and candy kitchen.”

To that end, in May, the company launched a line of mini cakes developed in partnership with the Jelly Belly Candy Co., Fairfield, Calif. The two-bite Petit Fours consist of layers of cake and cream covered in white coating and topped with a Jelly Belly. “The cream is flavored and colored just like the Jelly Belly,” says Henke. “It’s vibrant and has quite a flavor pop to it.”

The Jelly Belly Petit Fours’ flavors—Very Cherry, Lemon Drop and Blueberry-Pomegranate—reflect today’s flavor trends, according to Henke. “It’s kind of a mixture of traditional flavors that are coming back as well as updated flavors,” she explains. “We’re doing Very Cherry and Lemon, two longtime Jelly Belly flavors, but then also Blueberry-Pomegranate, which would fall into the newer trends that you’re seeing hit more than just baked goods. You’re seeing it hit candy, chocolates and all kinds of sweets and treats. In traditional flavors, we’re continuing to see a lot of Red Velvet, Carrot Cake and Sea Salt and Caramel.”

Lisa Christiansen, brand manager for Swiss Colony Retail Brands, says the company typically doesn’t go after “super-trendy ideas,” such as adding spicy or bacon flavors to its products. “The traditional Red Velvet, which you see time and again, or the Sea Salt and Caramel, those are the trends that we like to follow,” she says. “Also, pumpkin was a really big come-back flavor for us last year for the fall holiday season.”

The Jelly Belly Petit Fours will be sold in a nine-count box with a window and cobranded to resemble a Jelly Belly packaging. “It’s a nice size to take home—everyone can have a little treat,” says Christiansen.

Although the Jelly Belly Petit Fours haven’t hit the market yet, when they do, Christiansen says they’ll be displayed on tabletops in in-store bakeries, like its other Petit Fours. Some supermarkets and grocery stores may also position them in other departments, such as the floral or gift section, in a standup shipper.

Going gluten-free

While some consumers are trying to watch how much they eat, others are paying more attention to what they eat, especially when it comes to food ingredients. Like bread bakers, many sweet goods and snack-cake makers are shifting gears and using healthier ingredients in their products, leaving artificial ingredients, fats and lots of sugar in the dust.

“The demand that we’re filling is for what we call ‘real food,’” says Andy Axelrod, president, Love and Quiches Desserts, Freeport, N.Y., which makes a variety of gourmet desserts and quiches for retail, including convenience stores, and foodservice customers around the world. “You can see that in the C-stores, with the quality of the offerings they’re bringing in. This also goes for other food retailers.”

Love and Quiches Desserts’ Gourmet Grab and Go line of baked-from-scratch treats features six flavors: Rainbow Brownie (studded with candy-coated milk chocolate pieces); Triple Chocolate Brownie; Walnut Brownie; Cookies & Cream Brownie; Blondie; and Oatmeal Chewie with California Raisins. Each 3-oz., two-serving product has no artificial preservatives, additives or trans-fats. A barrier film bag helps give the products a 60-day shelf life.

According to Axelrod, the company also offers a 2-oz. brownie with no preservatives or additives and a six-month shelf life for vending and other applications, such as lunchboxes, packaged lunches and quick-service restaurants (QSRs). “We’ve been doing it for a while in Triple Chocolate,” he says. “Now, we’re launching it in the Rainbow variety.” A gluten-free product is in the works.

“Gluten-free is the biggest buzzword this year and [was] last year,” says Athena Uslander, president of Silverland Bakery, Forest Park, Ill., which introduced a Flourless Chocolate Brownie with an intense chocolate flavor at Expo West 2013 this spring, along with several other baked goods. People with Celiac disease as well as those just trying to avoid wheat products will appreciate the treat.

“We wanted to make a really fudgy, traditional brownie that’s gluten-free and flourless,” she says, “but also tastes really good and could be substituted for a brownie—one that people would eat and say, ‘Oh, my gosh, this is flourless?’” She adds that because the bakery is small, “we can’t really claim gluten-free. We call it flourless to capture that market.”

Silverland Bakery, which sells to both retail and foodservice customers, uses all-natural ingredients to create its brownies and other products, something which its customers insist on, according to Uslander. Clamshell containers help keep many of the company’s products, such as the brownies, fresh and make for a more visually appealing in-store presentation.

The company is also very committed to locally sourced ingredients, Uslander adds, although she acknowledges that this isn’t always possible in practice. “It’s rather difficult to be in Chicago and get a lot of the ingredients that we need, such as dates, which come from California,” she explains. “A lot of our nuts come from Georgia.”

Scott Anderson, vice president of operations at J.S.B. Industries, Chelsea, Mass., says consumers seem to be much more educated on nutritional values and what products can do for them. “They appear to be looking for the perfect sweet good that is not too bad for them, and also satisfies their sweet tooth,” he notes. “Some consumers are even taking it a step further and only shopping for products with added-value [ingredients], such as Omega-3s or probiotics.”

Anderson adds that gluten-free, dairy-free and even soy-free products are here to stay. “Not only are they an emerging product category, consumers are also expecting more out of them nowadays,” he contends. “They do not want products that may meet a specific diet to taste like cardboard. They want their sweet goods to be healthier and taste good.”

To that end, the company recently launched a line of Gluten-Free Snack’n Loaves and gluten-free muffins under its Muffin Town brand. “We developed these delicious 2-oz. products with the premise that we didn’t want the consumer to realize they were eating a gluten-free item,” says Anderson. “We wanted them to think, ‘Wow! This is so good, it can’t be gluten-free…but it is.’” Both come in Blueberry, Chocolate Chip and Coffee Cake flavors.

Introduced at the same time as the gluten-free products, Muffin Town All Natural Snack’n Loaves are decadent, 2-oz. items that can be eaten for breakfast, on the go or for dessert. The line has three flavors: Apple Cinnamon; Wild Blueberry; and Double Chocolate.

Like the company’s other products, Muffin Town Gluten-Free Snack’n Loaves and Gluten-Free Muffins are available at various retail and foodservice venues throughout North America.

Quality- and value-driven

Like a novice driver buying his first race car, “consumers are demanding greater quality and value from their purchases overall and sweet baked goods are no exception,” says Jamie Griffis, associate brand manager, consumer brands, Dawn Food Products, Jackson, Mich. “It will be more important for manufacturers to develop innovative products that provide a notable point of difference, especially as category and consumer expectations continue to evolve. Dawn Foods has an opportunity within the sweet baked goods category to provide an affordable indulgence through product innovation, while still delivering on consumers’ high taste expectations.”

Weight Watchers Red Velvet Crème Cakes, launched in November, certainly fit the bill. The moist, red velvet cake surrounds a rich filling made with real cream cheese and is topped with a layer of sweet icing. Each cake is only 90 calories and has a PointsPlus value of 2.

The company also is on track to introduce two additional Weight Watchers Sweet Baked Goods products late this summer: Triple Chocolate Brownie Bliss, a chocolate brownie layered with decadent, real chocolate ganache, covered in dark chocolate with a milk chocolate drizzle, and Peanut Butter Brownie Bliss, a chocolate brownie layered with creamy, real peanut butter, covered in milk chocolate with a peanut butter drizzle. Calories per serving are 80 and 90, respectively. Both products contain no trans-fat and have a PointsPlus value of 2.

“With Weight Watchers Sweet Baked Goods products, we’re focused on fulfilling the needs of weight-conscious women,” explains Griffis. “We continue to see a need for products that deliver great taste, but also provide additional nutritional benefits like fiber. Portion control remains important, although the consumer mindset is evolving from 100-calorie packs to products that deliver added value and the ‘presence of positive’ ingredients rather than simply limiting calories.”

Whether they’re trying to lose weight, eat healthier or enjoy an occasional decadent treat, consumers are unlikely to give up their favorite sweet goods, be they cinnamon coffee cakes or rich, chocolaty brownies. Instead, they’re seeking out products made with fewer calories and healthier ingredients as well as smaller portions. Savvy sweet goods and snack cake manufacturers can drive these consumers to their brands by acknowledging these trends and introducing products that will breeze over the finish line. 

State of the Industry Overview