In-store bakery is becoming a consumer magnet: Report

In-store bakery is becoming increasingly attractive to consumers, according to a new report. A whopping 95% of shoppers consume products from the department at least occasionally and 63% do so weekly, according to the “Power of In-Store Bakery 2022” report, published by the Food Industry Association (FMI).

The inaugural report notes that sector sales also are strong, with unit and dollar volumes up 7.4% and 14.4%, respectively, in the past year, with dollar increases the strongest for muffins (up 24.2%), cupcakes (23.6%) and cookies (21.7%). Cakes and cookies were the department’s biggest sellers.

“Our first-ever exploration on consumer perceptions of in-store bakery reveal several opportunities to enhance grocers’ strategies,” Rick Stein, FMI vice president of fresh foods, said in a statement. “Expand customer loyalty by enticing shoppers with freshness and assortment; incorporate and communicate quality ingredients; and lead with transparency on ingredient and nutrition callouts, even for those indulgent items.”

Indeed, shoppers report freshness is top of mind when they think of their in-store bakery, the report says.

“Claims related to freshness also top the list of what matters to shoppers and is a key differentiator for the in-store bakery over the bakery aisle. Most shoppers believe that bakery goods made from scratch are of superior quality, especially for cakes, pies and cupcakes.”

The report adds that baking from scratch is less important for bagels, breads and rolls, and shoppers are less certain about the importance or impact of items being partially produced elsewhere.

While the report reveals that shoppers spend their bakery dollars at a variety of locations, it adds that 78% purchase functional items, such as bread, buns, bagels and rolls, at the same store where they purchase most of their groceries.

However, just 51% say the primary grocery store is their main destination for in-store bakery items. For such indulgent selections as cakes, pies, and store-made desserts, shoppers look to specialty bakeries (24%), grocery stores other than their primary store (11%), and online options (6%).

Among the shoppers who visit the in-store bakery weekly are Millennials (35%), urban dwellers (42%); large households of three or more persons (49%); and households with an income of at least $120,000, the report says.

“Shoppers most actively involved with their in-store bakery are key segments of shopper in that they are younger, have larger households, are more likely to have children, are more affluent, spend more on groceries weekly and are more likely to do at least some of their grocery shopping online,” the report says.

Related:Bakery department brings in the dough

Retailers, meanwhile, can drive department sales further by expanding the array of indulgent options and inspiring impulse purchases, the report notes.

“Many shoppers acknowledge that their purchases of indulgent items such as donuts, cookies, snack/coffee cakes, single-serve desserts, and cupcakes are impulse purchases,” the report says. “Whether for functional or indulgent items, shoppers say they would be impacted by sale specials or promotions to make impulse purchases.”

Related:Bakery department brings in the dough

Among the key factors that will spur shoppers to purchase an unplanned bakery item aside from sales or specials are eye-catching displays (cited by 42% of consumers); more convenient than baking the item myself (38%); sampling (36%); and coupons (33%).