Baking & Snack - May 2023 - 8

editorial
Value does not mean cheap
V
Value. When it comes to products, the word typically
refers to a price point on the lower end. With the way
inflation has been, conventional wisdom would have
said that those value baked goods would be having their
moment. It seems, however, that value is just another
concept millennials and Generation Z have redefined ...
or at least added some nuance to.
At the American Bakers Association (ABA)
Convention held earlier this year, this shift came up
in both conversations around consumers and bakery
trends. The data clearly states that price doesn't drive
bakery purchases. In her opening to the panel " Taking
a Boundaryless Approach to the Consumer, " moderator
Jonna Parker, principal II/team lead, fresh foods at
Circana, formerly IRI and The NPD Group, showed that
dollar sales were up nearly 12%, while unit sales were
only down 2% in the 52 weeks ending Jan. 29.
Anne-Marie Roerink, principal of 210
Analytics, which conducted ABA's Life
Through the Lens of Bakery study, summed
it up this way: " Consumers want value, but
they don't want cheap. "
So if value isn't solely based on price these
days, what does it mean? That largely seems
to be up to the consumer and the specific
product they're purchasing and why.
" Affordable means different things to different
people depending on context, " Ms. Roerink said. " It's
about 'Is this worth it to the consumer?' "
Fresh and quality, for example, can prove a product to
be well worth the price to a consumer looking for a loaf of
bread that will be a vehicle for nutrition or a cake that will
help them celebrate a milestone with friends and family.
During her panel, Ms. Parker also pointed out that,
to millennials specifically, experience is more important
than price point - unless they're parents - even with today's
rising prices. And when it comes to the in-store bakery
channel, fresh doesn't cut it any more as a differentiator
or value add. As she put it, " Everyone is doing that. "
This means that even in the midst of rising prices,
consumers want something special from the bakery
category, whether it's an indulgent dessert, a premium
hamburger bun or an innovative snack cake that
they've never seen before. Bakers have the opportunity
to get creative with premiumization, or even help
make the case for a bakery purchase with smaller package
sizes or mix-and-match variety packs that meet
consumers' price points without sacrificing on taste,
choice or experience.
This brave new world where the old rules no longer
apply - or at least not in the same ways - can be intimidating.
But it is also good news when so often the
news these days is bad or at the very least a new challenge
to overcome. Consumers love their baked goods,
and they are willing to pay for them, as long as you
show them the value.
- Charlotte Atchley, Editor
catchley@sosland.com
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Baking & Snack - May 2023

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