From Our Print Edition

IT’S ALL ABOUT VALUE

While frozen bread and, especially, dough are on the rise, their refrigerated counterparts aren’t seeing the same success. Although sales of refrigerated cookie/brownie dough jumped 7.6% to $157.53 million, both pastry/dumpling (-4.2%) and bread/rolls/buns (-4.0%) dough were down. Refrigerated biscuit dollars climbed 1.7%, but units fell 3.5%. Why the discrepancy between frozen and refrigerated?

“Frozen bread and dough often provide better overall value to shoppers over alternative options,” answers Paige Moore, business manager of category solutions at Stamford, Conn.-based Daymon, an Advantage Solutions company. “[Frozen] products have a longer shelf life, are typically lower priced and feature increasingly innovative options,” she explains.

Shoppers in search of great value helped boost sales of Rhodes Bake-N-Serv Dinner Rolls 8.5% year-to-date.

Dan Yost, senior vp at Dallas-based Bridgford, also cites value — and versatility — as a key driver of frozen dough growth. “Each package of [our bread and roll] dough can make not only bread and rolls but fry bread, sopapilla, cinnamon rolls and coffee cake as well as hamburger and hot dog buns. And each of these fresh baked gourmet bread items will cost half to a third the cost of prebaked breads.” Add to that the “incredible aroma” of bread and rolls baking in your own oven, and it’s no wonder bake-at-home frozen items are winning, he adds.

A closer look at year-to-date (YTD) sales data offers even more evidence that value — both actual and perceived — is topmost in consumers’ minds. For example, says Kenny Farnsworth, president and CEO of Salt Lake City, Utah-based Rhodes Bake-N-Serv, although the frozen dinner rolls segment is down 4.6% YTD, sales of Rhodes’ “thaw, rise and bake” White Dinner Rolls are up 8.5% “thanks to the excellent value the item provides.” (It’s available in 36- and 72-count bags.)

TEXAS TOAST & PRIVATE LABEL ON THE RISE

“We believe increased cost is driving a switch from low-value-per-ounce products (30 to 35 cents per ounce) to high-value-per-ounce products (10 to 19 cents per ounce),” he explains. But there are exceptions, he adds, citing growth in the Texas toast segment in particular. Despite the cost, “The value perception is still there because it’s a very convenient product, it’s flavored and it meets consumer expectations [around quality.] It’s what they would expect to find at their favorite restaurant.” Same story in frozen breadsticks — also growing — which consumers perceive as even higher quality, says Farnsworth.

Nearly 30% of frozen bread and dough SKUs launched during the past year carry a gluten-free claim, including Capello’s new almond flour buttermilk biscuits.

The growing importance of value is also supported by the stellar performance of private label bread and dough, which is prompting retailers to double-down on store brands. “We’re seeing more new item launches among private brands than we’ve ever seen before in these categories,” says Daymon’s Moore.

She adds that private label growth during the most recent 12 weeks was driven by two subcategories in particular: frozen crusty garlic bread and frozen biscuit dough. In fact, says Moore, “Private brand [frozen biscuit doughs] have booked 22.5% dollar growth and 15.8% unit growth over the latest 12 weeks, according to NIQ total outlet data…compared with national brand growth of 3.7% in dollars and 2% in units.”

But there are plenty of additional opportunities to drive store brand growth, she adds. “With restaurant prices continuing to rise faster than grocery prices, consumers are turning to retailers to provide them with restaurant-quality offerings they can enjoy at home…. Retailers can capitalize on this trend by expanding their private brand programs with premium options that replicate these out-of-home indulgences to provide assortment diversification with an emphasis on quality.”

Whether private label or national brand, what other on-trend products should retailers consider adding to their assortments? “Consumers are looking for innovation,” says Moore, citing growing interest in new, snack-friendly formats, including sphere-shaped products. “Activating this trend may look like taking a typical garlic bread loaf and reformatting it to become garlic bread bites,” she explains.

Private label was the biggest driver, but a 170.3% gain by Screamin’ Sicilian’s new Loaded Breadstix also helped power the frozen dough subcategory’s 6.3% growth.

Ethnic-inspired breads and doughs that give consumers an opportunity to “travel with their taste buds” are also in demand, especially among younger consumers whose appetite for global flavors is being fueled by social media. “International bread types such as naan and bao show no signs of slowing down,” says Moore. Empanadas — and frozen empanada dough — are also a hot-seller. “[Frozen bread and dough] offer consumers a great way to experiment and add new flavor to their daily routine.”

Finally, says Moore, retailers should consider adding more products that meet consumers’ lifestyle and dietary needs — “from paleo and keto to gluten-free.” She notes that, according to Mintel’s Global New Products Database, 29% of new frozen bread and dough SKUs launched during the past year include a gluten-free claim. Meanwhile, low-carb remains a hot trend. And sales of innovative wrap formats that deliver better-for-you or functional benefits continue to expand. “So retailers need to continue to innovate within these categories to meet shifting demand,” says Moore.

NEW VS. TRIED AND TRUE

However, manufacturers say finding the right balance between new and tried-and-true can be tricky. “A few years ago, many retailers expanded space allotted to ‘healthier’ breads,” recalls one manufacturer. “While they have a much higher dollar ring, their movement is sometimes very poor. So over the past year, many of those same retailers have taken space away from the healthy segment and returned it to the garlic bread, Texas toast and bread stick items that continue to perform. The increased shelf holding power has dramatically reduced empty shelves, and this is a large part of what’s driving the category forward.”