SCOTTSDALE, ARIZ. — While inflationary pressures may still be negatively impacting unit and volume sales of baked foods, Anne-Marie Roerink, principal, 210 Analytics, said the industry has reason to focus on the future with optimism.

“We expect an easing of all these pressures once the economy improves,” she said during her presentation on the American Bakers Association’s latest study, The Bakery Playbook, at the American Bakers Association (ABA) Convention held April 13-17 in Scottsdale. The Bakery Playbook is a series of research studies conducted by 210 Analytics and sponsored by Puratos. In April, the ABA released a total category study as well as studies on the bread and cookie categories.

A major indicator that the future is bright for the economy is a significant shift in consumers’ assessment of their own household’s financial situation, The study showed 31% of consumers expected to be better off financially next year, compared to 21% who held that expectation last year. Likewise, 19% of consumers expect to be worse off financially a year from now compared with 34% who felt that way last year.

“Consumers who expect their future to be better will spend more,” Roerink said. “They will start to eat out more, they will prioritize flavor and taste when purchasing, and deemphasize price and value.”

Another point that provides a glimmer of hope in the midst of all these pressures is that 94% of consumers reported that they can be persuaded to spend a little more on their food purchases. When asked why they might spend more on a bakery item than planned, the top three reasons were special occasions, holidays or for added health benefits. Treating oneself and treating someone else were tied at fourth with 31% of consumers reporting that as a reason to splurge.

While overall baked treats/dessert consumption frequency is down, Roerink called out those specific categories that have seen growth, according to Circana data for the 52 weeks ended Feb. 25, 2024. In the supermarket perimeter, brownies, pies and donuts all saw unit growth, while in the center aisle, pies experienced 10.8% growth. Roerink used cookies as a case study to illustrate why these purchasing decisions are more than just price.

“Price dominates as the reason someone will buy a cookie, but it isn’t the only story,” she said. “Flavor/ingredients, brand, preferences and even mood all come into play. It’s more about price and something else.”

Health and well-being is another area that will entice consumers to spend a little more. That’s because the definition of health and well-being has expanded to include emotional well-being. Ninety-two percent of consumers agree that physical health and emotional well-being are connected, which leaves plenty of opportunity for bakery to grow from its high permissibility position.

In addition to benefiting from a focus on emotional well-being, Roerink’s research showed that restrictive diets are on the decline with 45% of consumers reporting no particular focus or way of eating and 35% focused on eating a balanced diet. A balanced diet saw an increase of 16% compared with the 2022 Life Through the Lens of Bakery study, while gluten-free and diet plans like Weight Watchers and Jenny Craig were on the decline.

While the baking industry has long fought a negative perception of carbs from the health and wellness community, The Bakery Playbook research showed that 75% of consumers believe baked foods like bread, buns and tortillas belong in a diet, and 74% consider bread an overall healthy choice.

When asked about what makes a bakery staple like bread a better-for-you (BFY) item, buzzwords like whole wheat, whole grain and gluten-free trended.

BFY baked treats/desserts were marked by an interest in real fruits/vegetable inclusion, reduced sugar or sugar free, and portion control, which also plays into pricing.

Younger consumers such as millennials and Generation Z also are willing to spend more on bakery items that feature sustainability claims. These run the gamut from environmental initiatives to community support. While this is still in its infancy, Roerink encouraged baking companies to start telling their sustainability and social responsibility stories now as those two demographics will only continue to increase in buying power.

ABA members can expect studies on pastries, buns and rolls, and tortillas in June; donuts, crackers, and English muffins and bagels in September; and cakes, cupcakes and snack cakes, and pizza and flatbread in December.