Packaging and innovation emerge as key needs in fresh bakery

For decades, consumers strolled the aisles of the fresh bakery department, savoring the ability to make their own choices from bountiful displays of loose, unpackaged product. As Americans sought more convenience, the need for packaging tipped the scales in a different direction. Now the COVID-19 crisis has rapidly accelerated consumer demand for fresh packaged bakery.

In 2020, operators and retailers reached new heights to protect shoppers during the pandemic – from meticulously wiping down surfaces and placing tables 6 feet apart to making hand sanitizers easily accessible, encouraging electronic payments, and utilizing disposable utensils and menus. But even those measures might not be enough for consumers in 2021.   

In December, global, family-owned Rich Products asked consumers about their preferences for products in self-service bakery cases. More than half (55%) of consumers said they prefer to see all fresh-baked goods and donuts packaged.

So, what does this mean for the future of fresh, self-serve food? How do operators communicate that their products are safe, while continuing to be fresh and delicious?

Rich’s has a few ideas for retailers and operators:  

Purposeful packaging: 66% of shoppers say it’s very important to see the items through packaging. 52% are also looking for packaging that adds shelf-life as a quality cue.

Shelf space: Increase appeal and signal freshness, keeping assortments well-stocked and rotated. On shelf claims like “fresh” and “baked today” resonate even when products are pre-packaged.

Inspire impulse: Consider cross-merchandising bakery items with relevant categories like deli to prompt purchase. Secondary placement in high-traffic areas like produce also increases purchase and drives basket size.

Jen VanDewater, vice president, health, authenticity and strategic insights at Rich Products, shares her thoughts about this consumer demand trend for increased food safety, and offers tips for how retailers and operators can prepare and respond.

“The pandemic has accelerated consumers’ focus on health and safety. We have been tracking consumer sentiment and gathering consumer preferences around food safety – 55% of consumers are looking for fresh bakery to be packaged,” she explains. “This tells us safety remains a part of consumers’ considerations when making choices in the bakery.”

The pandemic has amplified the need to look at packaging solutions, VanDewater said. So, now packaging is an area of investment and strong involvement.

Looking at the surging demand for impactful solutions, research from Rich Products reveals that 66% of consumers want purposeful packaging – where you can see the product.

“Being able to see the product is very important,” VanDewater explains. “In addition, functional, modified atmosphere packaging (MAP) is increasing in demand in bakery because consumers are concerned about waste. And finally, keeping a full bakery case is a signal of freshness.”

Another important piece of the puzzle is the need to focus on fun and interaction.

Consumers are seeking solutions to share, like Do It Yourself (DIY) kits. VanDewater says there are two categories where consumers are exhibiting the most interest: pizza and take-and-bake breads and rolls.

• 25% of consumers responded they would be interested in purchasing a pizza kit in the next 3-6 months.
• 21% of consumers reported interest in take and bake breads.

“It is very important to focus on safety and provide packaging solutions that deliver on the experience,” she says. “It is important to focus on smaller celebrations. And being transparent is very important.”

Transparency means clean and prominent signage in the bakery -- explaining bakery practices and on-package messages like “fresh baked today.”

And there is a vitally important online component to this movement.

Retailers are engaging with customers before they arrive in the store, so it is critical to engage with consumers through online platforms, VanDewater says.

“Looking ahead, we can expect permanent shifts in consumer behaviors because of the pandemic. COVID-19 has certainly accelerated a shift in behavior for online shopping,” she adds. “There is an opportunity for instore bakeries to position products to meet this demand – in messaging, for example. Talk about the flavor and the quality of ingredients in your online communications. Retailers who have invested in online platforms and solutions to make fresh bakery available online are seeing positive results with today’s consumers.”

Positioning bakery for the future is vital to continued success, understanding there will be some level of permanent change.

“This is a time of analysis and reflection to really understand the shifts in consumer demand and how it impacts the business models of the future,” VanDewater explains. “We will need to continue tracking and understanding consumer expectations as it relates to the balance between price, value and convenience, along with health and safety, as pandemic uncertainty continues.”

Retail perspective

For retail bakeries, the challenge is straightforward. How do you recuperate lost business when more Americans are confined to their homes or hesitant to venture out because of the COVID-19 pandemic?

For Stephanie Hart, owner of Brown Sugar Bakery in Chicago, her strategy is clear.

“I’m a doer. I’m doing what I can to build back our community,” she says. “We are going to survive. Our work doesn’t stop. I’m looking for a silver lining all the time. If you think different thoughts, you get different results.”

Hart shared her insights in a recent interview with a local Chicago station, The Jam. She opened Brown Sugar Bakery in 2004 and from there she has developed a client base that appreciates the love they taste in her cakes. This Greater Grand Crossing bakery’s tagline is “life is sweet,” and it delivers on the promise with cheesecakes, cupcakes, cobblers, cookies, pies and more. Specialty sweets include sweet potato pie, peach cobbler, and bread pudding. Nearly 20 whole cake flavors are available, including German chocolate, red velvet, carrot and turtle.

In particular, Hart is dedicated to baking products that African Americans love, striving to connect patrons to longtime traditions.

One of Hart’s good friends produced “The SOUL Food Monologues,” which is designed to uncover and promote the powerful food and justice stories of everyday people working for change. Hart wants to bring that to Chicago.

“I’m very proud of baking cakes,” she continues. “For our customers, we connect a childhood memory for them. This is an amazing time. Once you start awakening awareness, you can make change.”

Working closely with Dawn Foods has helped her business evolve and prosper, Hart says. She is preparing to start a private label cake business, featuring decadent 2-pound cakes.

“I’m excited about the future of being a food entrepreneur,” she says, adding she recently added a new project taking over the local Cupid Candy Factory business. “I’m proud to continue the Cupid Candy Factory legacy, and we will have new products. I want to get over there and create more jobs with what I do. I want to reach out in new ways, and the potential of internet sales is vast.”

Similar challenges

Grebe’s Bakery, Milwaukee, Wis., sells ample supplies of 14-ounce boxes of Grebe’s Cruller Bites, a signature item, as well as premium packaged donuts in a variety of flavors to retail accounts including local three-store grocer Metcalfe Market and Speedway convenience stores.

“This pandemic is accelerating what already was going to happen,” said Colton Grebe, vice president of Grebe’s Bakery. “We offer fresh quality donuts in great packaging.”

Tim Metcalfe, president and co-owner of fourth-generation, family-owned grocer Metcalfe’s Market in Madison, Wis.

The challenge is how to prepare.

“For everybody in food distribution, this has been unprecedented,” said Metcalfe. “We have best sellers, but fringe items are out of stock. We have 3,500 local items. I have local eggs, local meat, local bakery. Supporting local is really beneficial for us.”

Metcalfe’s Market is a three-store gourmet grocer in Wisconsin with a fourth, small location nestled in the Dane County Regional Airport in Madison, Wis. The company specializes in fresh baked breads and pastries from 25 local bakeries, more than 500 varieties of artisan cheeses, Boar's Head deli meats, and a large variety of local and organic produce.

“Right from the beginning, we knew there would be a constant level of change in our organization. We’re used to change, but not such rapid change,” Metcalfe said. “We knew that even when we get out of this, there will be a question of what is the grocery business going to be like.”

Metcalfe said company officers monitored the situation closely from the start, tracking global news developments in China, Italy and elsewhere. First and foremost, they determined protection of workers and protection of customers are paramount.

Other steps included hiring an infectious disease consultant (dealing with questions like how to maintain a social distancing plan) and using artificial intelligence (AI) to monitor and manage in-store customer traffic.

“We have installed a mat in two stores that counts people coming in. We are implementing a new thermal imaging system that counts people coming in and out,” Metcalfe said, “so we never have queuing in checkout lines.”

Metcalfe recognizes that e-commerce had not been “overly adopted, but that’s going to be a huge change. People have gone there, and I think it’s going to stay that way.”

Individually wrapped

The idea for individually wrapped donuts came about thanks to the Baker Boy team doing some good old-fashioned customer outreach. At the outset of the COVID-19 pandemic, Baker Boy began asking its many distributor partners and longtime K-12 school and healthcare customers what they saw as an immediate need in the face of the pandemic. The overwhelming majority of those said they needed more touchpoint-free foodservice solutions.

In response to this market demand, Baker Boy launched a line of seven individually wrapped donuts in September.

“We have seen immediate success with the school, healthcare and convenience store markets, as well as with independent grocers who lack the labor or facilities to decorate donuts for bakery cases,” said Dustin Monke, marketing manager for Dickinson, N.D.-based Baker Boy.

In addition, Baker Boy launched The Donut Hole thaw-and-serve fully finished donut line in October 2019. It quickly became one of their hottest new product launches ever. Baker Boy now offers 15 fully finished donuts, including three flavors of its award-winning Magic Ring Filled Donuts, which are iced and sprinkled ring donuts with filling in every bite.

The individually wrapped donuts also fall under The Donut Hole brand.

“With The Donut Hole line, we try to offer something for everyone,” Monke said. “We have iced and glazed donuts, yeast-raised and cake donuts, and everything from old favorites to new innovations such as the Glazed Apple Filled Fritter.”

The COVID-19 pandemic seems to have influenced the way donuts are packaged and merchandised more than the types of donuts that stores are selling. “We all know supermarket bakery case sales dropped severely at the onset of COVID-19. But sales appear to be steadily rebounding, and the donuts being offered at store level appear unchanged from the pre-COVID days,” he said.

The marketing slogan for The Donut Hole thaw-and-serve line has been “No Preparation. No Worries.” These donuts provide exactly that: a solution for operators who want to be in the donut business but lack either the labor or the preparation capabilities at the store level.

Originally marketed as a solution for convenience stores, Baker Boy has seen this line be embraced by independent grocery chains, especially during the COVID-19 pandemic as stores looked for touchpoint-free options for bakery cases and bakery tabletop displays.

The donuts arrive in easy-to-manage 30-count cases. Each case has five six-count trays with available branding and nutritional information.

“We have learned customers merchandise these in a variety of ways, but they’re primarily sold as singles inside bakery cases or by the half-dozen inside of the provided trays,” Monke said.

“Our customers are still demanding new and innovative ideas,” he said. “While we are going through a strange period of time where some consumers want normalcy and others demand items be free any from human contact, we are doing our best to offer both options to our customers. The key to getting consumers back over to the donut case and into donut shops is by offering them something they can’t get anywhere else. That’s why Baker Boy’s technical experts and our research and development teams will continue to develop more flavors of Magic Ring Donuts and inventive ways to decorate and merchandise donuts.”