Those who love sweet goods have plenty of occasions to celebrate. There are national days of recognition for brownies, cinnamon buns, cookies, cupcakes and donuts. Pies have their own national championships that typically draw more than 500 entries. And the proliferation of cake-inspired reality television shows — “Cake Boss,” “Cake Masters” or “Cake Wars,” anyone? — almost guarantees those with a sweet tooth will never run low on food-based entertainment options.

It should come as no surprise that everyone wants in on a piece of the pie. Despite inflationary costs, consumer desire for better-for-you (BFY) products and fluctuating sales numbers in both the center aisle and perimeter, the sweet goods category shows no sign of losing its fan base.

Several larger baking companies already have a foothold in the category. Hostess Brands Inc., for example, a subsidiary of The J.M. Smucker Co., Orrville, Ohio, is steadily rolling out new snack cakes and treats, while Bimbo Bakeries USA, Horsham, Pa., a subsidiary of Mexico City-based Grupo Bimbo SAB de CV, maintains a presence in the category with its Entenmann’s brand. Is there room for one more? Mondelez International certainly hopes so. The Chicago-based company recently announced plans to carve out its own share of the sweet goods category.

Dirk Van de Put, chairman and chief executive officer, Mondelez, told investors in a Sept. 4 session at the Barclays Global Consumer Staples Conference in Boston that the corporation’s recent acquisitions in the baked snacks category, including Chipita, Global SA, Clif & Co., Give & Go and Perfect Snacks, for example, offer a springboard for expansion into soft baked treats such as cakes and pastries.

“If you imagine the biscuit aisle, which is probably crackers and sweet biscuits in Europe, particularly a little bit less in the United States, across from that aisle, you will find a whole space with softer offerings — cakes and pastries basically,” Van de Put said. “It’s a natural extension of the biscuits space. It’s a space that’s very fragmented. It’s about an $80 billion market globally, slightly smaller — but not a lot — than chocolate and biscuits. But in certain markets, like China, where chocolate is $4 billion and biscuits are $8 billion, cakes and pastries are a $30 billion market.”

It's not just the big companies that are making a play for market share. Mid-sized bakeries such as Toronto-based Bond Bakery Brands, which counts Coco Bakery Inc. and Portofino Bakery Ltd. as part of its portfolio; Dutchland Foods, Lester, Iowa; and Ethel’s Baking Co., Shelby Township, Mich., are also establishing a name for themselves with their original brownies, cake pops, cupcakes, macarons and pastries.

Overall, the category is lagging, which is reflective of the downward trend seen across the board in center-store bakery and the perimeter. According to Circana OmniMarket data for the 52 weeks ending Aug. 11, both dollar sales and unit sales are down in center store desserts/sweet snacks (-2.2% and -5.6%, respectively). Things are slightly better in the perimeter, where dollar sales are even and unit sales show only a slight dip at -0.8%.

When it comes to sweet goods, however, the total numbers don’t necessarily tell the entire story. Center aisle dollar sales for cookies (+0.5%), pastry/Danish/coffee cakes (+3.6%) and pies (+2.8%) all increased; brownies/squares/bars (-1.6%), cakes (-4.7%) and snack cakes (-3.7%) all took a hit. The perimeter numbers for the same period paint a slightly different picture. Brownies/squares/bars (+5.8%) and cakes (+0.6%) rose in dollar sales; cookies (-0.7%), pastry/Danish/coffee cakes (-0.2%), pies (-2.9%) and specialty desserts (-2.0%) all dropped.

The big winner in the category is croissants, according to Jonna Parker, principal II, fresh foods client insights group, Circana, who, in the “Food! The Biggest Influencer: A Circana Deep Dive” webinar, revealed the French puff pastry is up a whopping 8.9% (center aisle) and 3.7% (perimeter bakery) over the last 52 weeks. Donuts also performed well during this same period, seeing 0.8% and 4.6% growth, respectively.

This article is an excerpt from the November 2024 issue of Baking & Snack. To read the entire feature on Sweet Goods, click here.