State of the Industry 2018: Publisher's note
We have long valued the strong partnership our staff at Snack Food & Wholesale Bakery has forged with Chicago-based market research leader IRI to provide fresh data for our category trend insights in every regular issue of the magazine. Relying on this single source of data keeps our year-over-year analysis consistent, and working with current data each month keeps our insights fresh. And while we cover one of these snack or bakery categories in every regular issue of the magazine, when it comes to our annual “State of the Industry” issues, it’s bonanza time. Everything is on the table, and everything gets a fresh look.
When reviewing the IRI data that forms the backbone of this issue, one key trend clearly emerged: the rising power of organic in today’s bakery market.
According to the Organic Trade Association’s 2018 “U.S. Organic Industry Survey,” organic food sales in the U.S. hit a new high of $45.2 billion in 2017, up 6.4 percent from 2016. While this rate of growth is slowing, that’s expected in a maturing market.
IRI’s data revealed organic growth in some key areas: granola bars, fresh bread, bagels/bialys, English muffins, frozen waffles and refrigerated cookie/brownie dough, with the organic brands far outpacing overall category numbers. Dave’s Killer Bread has provided a nice boost over at Flowers Foods, and the company has wisely extended the brand’s reach into new segments over the past year, like bagels. We expect that pattern to continue on a strategic basis. Vermont Bread Co. has shown steady, year-over-year growth in the English muffins segment, as has Nature’s Path Foods over in frozen waffles. And it seems like every Annie’s Homegrown product line shows annual growth—a pattern that is bound to please parent company General Mills.
As our editor is fond of saying lately, “Organic is the original clean label.” With all of the talk about the power of clean label to drive growth across baking, grounding yourself in the structure of USDA organic standardization makes good sense.
Of course, organic doesn’t always align perfectly with every category within the context of today’s shopper and industry dynamics. Some categories are notoriously more difficult to pull off in an organic format than others—and some categories just aren’t core products for the average cross-section of today’s organic consumer.
But challenging the status quo can help define a company. Our 2018 “Snack Producer of the Year,” Late July Snacks, first made a name for itself by stepping into a category—saltine crackers—where organic didn’t previously exist. Now they’re an over $100 million company.
Sometimes, you just have to have muster up the strength and courage to be a pioneer.