SOMETHING FROM MUFFIN

ROSEANNE HARPER

Muffins are holding their own despite fears that the federally mandated nutrition labels in effect since May would scare shoppers away from what they used to perceive as a healthy treat.

According to retailers interviewed by SN, shoppers still are buying muffins, even though the relatively high fat and calorie content is now spelled out in black and white on the package.

Some bakery executives interviewed by SN reported that sales are actually up because the fears have made retailers take a new look at

the category.

"It woke up the category. Muffins were dying a year ago, before [the Nutrition Labeling and Education Act]. Now we're highlighting their healthy qualities such as high fiber content or high potassium, with signage, and our sales are up 5%," said an official at a large supermarket chain in the Northeast. "It got us paying more attention to muffins. We've brought in mini muffins, and we went to clear-tray packaging for all our muffins. It really gives them eye appeal," said Thomas Hughes, director of marketing and advertising at 14-unit Clemens Markets, Lansdale, Pa.

"Believe it or not, our muffin sales are up 35% from a year ago. We changed our formulation. It's a higher quality muffin and we've begun promoting muffins at a reduced price once a month in circulars in all divisions," said an official at one of the top-10 supermarket chains in the United States. Others have been using such tactics as cross-merchandising corn muffins with rotisserie chicken, adding giant muffins at a special price to build sales and featuring a flavor of the month. There's also been healthy activity with introductions of health-oriented items such as low-fat, non-fat and sugar-free muffins.

"We recently added two more varieties to our fat-free. Now we have seven in that line," said Mark Sutherland, marketing director at the 113-unit Tampa, Fla., division of Winn-Dixie Stores, Jacksonville, Fla., who added that the labeling law has had no apparent impact on total category sales.

Vons Cos., Arcadia, Calif., for the first time began offering two varieties of fat-free muffins -- blueberry and apple cinnamon -- earlier this year. Sales of have met expectations, said Julie Reynolds, a Vons spokeswoman. The chain is also featuring a muffin of the month in its weekly ads.

When its muffin sales began to drop a year ago, Nicholas Markets, Haledon, N.J., began to pick up some of the slack with the addition of a nonfat muffin line, said Nicholas Lacatena, senior vice president of the four-unit retailer.

But traditional muffins still dominate, retailers said.

"People are creatures of habit. They're not going to give up muffins because they're a little surprised at their fat content," said Barb Harner, bakery director for four-unit Steele's Markets, Fort Collins, Colo. Hughes at Clemens Markets agreed. "If people based their buying decision on ingredients, chocolates would have disappeared from shelves years ago," he said.

Here's more of what retailers had to say about muffins:

Corporate source Large Northeast chain

I think nutrition labeling has actually had a positive effect on the category, and we don't even have our new packaging design complete yet. We've had 5% growth in the muffin category since this time last year. We're promoting muffins quarterly and putting the spotlight on the basic flavors. We'll get customers into the department with those, and then they'll buy others.

We also found that all the attention to nutrition brought requests from customers for no-sugar muffins. So we added three varieties -- cherry, pineapple and orange -- that are sweetened with natural fruit juices. They're doing better than we even thought they would. We had tried no-sugar muffins three years ago, and they didn't go anywhere. This year, we also took on four flavors of a branded low-fat muffin, which is doing better than expected. I don't see the muffin category declining. Growth will continue. There's a lot of utility in muffins. We've tied them in with our rotisserie chickens. And they're a filling breakfast item.

John Schnepp in-store bakery sales manager Big Y Foods Springfield, Mass.

Part of the reason we introduced our World Class muffins -- a larger improved muffin that has more fruit in it -- last summer was to revitalize the category. Sales are up to expectations. Muffin sales had been slowing down before that introduction. Barbara Page public relations manager Price Chopper Supermarkets Schenectady, N.Y.

We've had fat-free muffins for three years. Sales are good, and regular muffin sales are about the same as last year. The sales and customer input tell us there's reason to continue to carry the fat-free line. The traditional muffin will survive but low-fat and no-fat muffins will be a factor.

Barb Harner bakery director Steele's Markets Fort Collins, Colo.

We had some shocks when the first labels went on. We saw a drop of a good 20% for two or three weeks, then within a month after that, sales came right back up. Most of that drop was in self-service, but that's back up to normal as well as sales at the service counter.

I think it helped that we were out on the floor, interacting with customers. We always are, but it gave us an opportunity to educate customers in this case. We'd point out, for instance, that the fat content is different in different varieties of muffins. For instance, a carrot muffin has more grams of fat than a bran muffin. But we also built good displays. I'm convinced that if a product tastes good and your display and signage are attractive people will buy. We've experimented a little, trying to create a low-fat muffin that tastes good, but we haven't been satisfied yet with the quality. But I also think people in this part of the country aren't afraid to eat what they want. Maybe because they're particularly active. Doughnuts and other fried pastries make up 15% to 17% of our bakery sales. We also added two varieties of fat-free muffins.

Official Top-10 chain

Our muffin sales are up 35% since this time last year. If you've been eating muffins all your life, are you going to stop now because there are too many grams of fat in them? We changed formulations, not for lower fat, but just a better quality, better tasting product. We're having them made for us, and they'll soon be making a private-label line for us.

From corporate, we're telling all divisions to promote them once a month, and we're hammering away at the basic flavors. Blueberry, corn, cranberry orange. That's what people come back to buy, not all those oddball varieties. You have to give people a great-tasting product. That's what counts. If you have only a tasteless muffin on the racks, they'll buy it once and never buy another muffin from you. We do carry a no-fat line that's doing just fair.

John Smolders bakery director West Linn Thriftway West Linn, Ore.

We sell a lot of muffins, but I don't want to sell any more of them than I am now. I don't make much money on them. I only carry them because my customers want me to.

Since Costco came into this area, I've been meeting their prices at six 5-ounce muffins for $2.49. We also sell three-ounce muffins in a fancier package, but the others are the best sellers.

I brought in some low-fat and no-fat muffins about a year ago, and I even tried a sugarless mix, but I got burned. They didn't sell. We're known for our gourmet bakery. I don't think people care about fat and calories when they come in here.

Nicholas Lacatena senior VP Nicholas Markets Haledon, N.J.

Sales of our regular muffins are down 25%. We've taken on a low-fat and a no-fat muffin and they're making up some of the difference, but we're still down about 10% in the total muffin category. I don't think this is because of the labeling law. It started before it went into effect, and we're exempt because we bake in-store. I think people just aren't eating that many muffins anymore, at least not in this area.

Thomas Hughes marketing and advertising director Clemens Markets Lansdale, Pa.

We're pretty well pleased with our muffin sales. They've stayed stable.

We brought in mini muffins about a year ago. There's a great value perception with them. They're something different, too, to attract people. There's possibly a healthier perception, too, because of the size. The price point is good and they've done even better than we had expected them to. Muffins are also a regular ad item for us.

Dan Courser VP, perishables Busch's Valu Land Ann Arbor, Mich.

Total muffin sales are up 30% to 40% since last year, but we gave them a real shot in the arm when we opened our cappuccino bar last spring. We introduced giant, 6-ounce muffins for 99 cents, hot out of the oven, to be sold particularly at the cappuccino bar. They're made in our central facility, and baked off at store level. We don't make much on them, but I'm just aiming to build sales right now. I want everybody who buys coffee to buy a bakery item.

We also have a 6-count package with 2.5-ounce muffins and a 4-count with 5-ounce muffins. Even those alone are up 8% to 10% from a year ago. We do advertise them frequently, featuring a flavor, and bring the price down. I just think muffins are a stable category. I expect sales to continue to grow. We took on a branded low-fat muffin several months ago, and we've had marginal success with it.