STUDY: ISBS GAIN MARKET SHARE

ROSEANNE HARPER

MADISON, Wis. -- Supermarket in-store bakeries have gained market share, putting them in a good position to hike sales, even as carb-consciousness erodes overall baked-goods consumption, according to new research.

The study commissioned by the International Dairy-Deli-Bakery Association revealed the percentage of consumers buying their bakery products from ISBs has risen in every category since 1999. The survey conducted for IDDBA by Rosita Thomas, president of Manassass, Va.-based Thomas Opinion Research, updated similar surveys Thomas did for IDDBA in 1999 and in l994.

There is no doubt that total consumption of bakery products is down. In fact, earlier this year, The Wharton School of Business, Philadelphia, reported sales of bakery ingredients had plummeted 10% from a year earlier.

The IDDBA study confirmed that overall baked-goods consumption is down. Results also showed that consumers value the convenience and freshness ISBs offer them. Those certainly are things supermarket operators could capitalize on, Thomas said at a recent industry gathering.

In a subsequent interview with SN, Thomas indicated her research showed that ISBs could maximize their sales with minimal tweaking. Changing product mixes, providing even more convenience, offering more nutrition information, sampling products, and even touting the healthy aspects of products high in carbs can boost sales and secure an even bigger market share, she said. Data collected showed particularly high potential for special-occasion cakes and low-carb products. More consumers are realizing whole-grain bread is OK, Thomas also noted.

"In-store bakeries are in a prime position if they highlight nutrition," Thomas said. "They can play up the fact that certain products, no matter the number of carbs, are good for you. They can do some educating.

"For instance, explain the difference between complex, vs. simple carbohydrates. Also, point out that whole-grain breads, for example, have lots of fiber and no preservatives -- something consumers also show concern about. I think that's where we need to put our attention."

In fact, she said, research showed the number of consumers who read nutrition labels is growing. In the most recent survey, 84% of respondents said they read nutrition labels, compared to 72% in 1999.

While overall bread consumption is way down, with 46% of respondents saying they eat less bread than they did a year ago, 33% said they're eating more whole-wheat bread, Thomas pointed out.

"Most important this year is that consumers are starting to hear in the media about health issues. This is the year we found out we're fat. Consumers are concerned about nutrition. They want more information. They want to feel good about what they're eating."

The No. 1 reason they shop their ISB is convenience, followed by freshness, the study revealed. Fifty-two percent said they'd buy bread if it were fresher, and 70% said they'd be more likely to buy bakery products from the self-service bakery.

Sixty-five percent also said they'd be more likely to buy if they were offered samples.

On the surface, the data seems gloomy. A full 17% of respondents said they're on a low-carb diet, and 34% said keeping carbs low is a good idea. However, the percentage buying bread in the ISB has increased in every category, with 64% saying they buy Italian bread in their ISB.

Surprisingly, consumption of cakes, especially special-occasion cakes, is up, and the percentage of consumers buying those cakes at ISBs has risen. In fact, the percentage buying sweet goods in all categories at the ISB is up from 1999.

Special-occasion cakes and croissants are the sub-categories hurt the least by the low-carb onslaught.

Of consumers polled, 37% said they buy croissants in their supermarket's in-store bakery, compared to 23% who responded that way in IDDBA's 1999 study. When it comes to special-occasion cakes, 48% said they buy them at their ISB, vs. 42% in 1999. Indeed, that category overall looks good for the future, Thomas said, because it's growing, with 82% of respondents saying they buy special occasion cakes, vs. 79% in 1999.

In her study, Thomas polled retailers as well as consumers to see if they were on the same thinking track. In that regard, one of the biggest gaps the research revealed was the importance of nutrition information. Another involved prices.

A full 60% of consumer-respondents said nutrition labeling is very important, and 83% said they're concerned about the nutritional aspects of baked goods. Yet only 31% of retailers said they thought consumers would deem that very important. On the price issue, 74% of consumers said a reasonable price is very important, but only 27% of retailers thought price would rank so highly on the consumers' list of considerations.

Conducted in March, the study involved more than 700 respondents who shop their in-store bakeries.