Last updated on March 30th, 2023 at 11:52 am
As U.S. shoppers battle inflation, value for money is paramount for retailers competing for custom in a market fiercer than ever before. We sat down with Neil Pittman, director of sales USA for St Pierre Bakery, to talk about why today’s challenges create opportunity for brands able to help retailers balance demand for quality and need for a value proposition.
Why Brands Are Driving Bakery In 2023
Pittman: Bakery is a staple category for U.S. shoppers. Despite financial challenges and a constantly changing consumer landscape, money will always be spent in the sector and savvy retailers will look to engage shoppers through quality, consistency and in-store experiences that garner loyalty.
That’s where St Pierre comes into its own. For consumers, the trend for premiumisation is here to stay. Previously, shoppers were elevating their meals at home because they couldn’t travel or dine out in the pandemic. Now that the cost of living is on the up, consumers are still looking to treat themselves well at home. This is backed up by the data, too – with “specialty rolls” sales growing 22 percent in the last year and ‘brioche’ as a category growing at 20 percent.
Retailers offering a trade up in one area of the grocery store can drive increased sales in other areas – and that’s why getting the offering right in bakery is paramount for retailers. For example, a shopper who opts for a premium brioche burger bun from St Pierre is more likely to pair it with premium meats and cheeses. Our innovative merchandising and standout branding catches the attention of shoppers – and we know that St Pierre shoppers have a higher basket spend as a result of opting for our quality baked goods.
As a U.K.-based company, we understand the impact of supermarket price-matching and increased cost of living has on the “middle shelf.” As a result, we’ve seen time and again that premium brands win out. Many of the categories where this is true – and especially in bakery – have been renowned for leaning in on private label. This is changing and retailers are recognizing that it is branded offerings that deliver excitement and theatre in the fixture. That in-store theatre is backed up at every consumer touchpoint and as such, the velocity of branded goods is so great that private label simply can’t compete.
Increasingly, retailers are reviewing their private label programs, looking to inject some brand personality in a bid to drive sales, or remove the private label offering all together. In the brioche category, specifically, brands are outpacing private label and have been for some time. Brands are delivering $326 million to retail versus $253 million coming from private label. Clearly, consumers are looking for quality products from brands they believe in and that’s part of the reason the St Pierre brand is growing at 9 percent on last year.
We invest heavily in marketing support to ensure we continue to build a brand that shoppers engage with. We consistently deliver a quality product and a unique experience that starts in-store with our innovative merchandising and continues at home.
When you couple our approach to brand-building with the fact that our fill-rates average at a market leading 98.5 percent, we become a very attractive proposition for retailers vying for custom in a fiercely competitive market. This becomes even more important during grilling and holiday season when sales peaks mean that retailers really need reliable partners who can deliver on time and in full, to keep shoppers coming to store.
Understanding what ‘value’ means to shoppers is always key – but it is particularly important in the current climate. Bakery is a relatively low value category and with consumers watching what they spend, they are more discerning. It doesn’t mean they’re spending less, they are just more aware of what they perceive as value. This offers opportunity for premium brands – particularly in bakery. The difference between an extra dollar in-store is minimal, but the difference it makes to the quality of a shoppers’ meal is much more significant.
It is our understanding of the consumer mindset and investment into data and research that keeps us informed and able to stay one step ahead. This year, we are focusing less on new products and more on new pack sizes. We’re working with retailers to offer bigger packs and better value on our core range of brioche burger buns and brioche hot dog rolls. All of our products also offer fantastic shelf-life which means retailers running a program with St Pierre are not risking wastage in the way they might with other brands or private label offerings.
The team is excited to attend shows again this year to share updates on the St Pierre brand and our products. We attended EXPO West again this year and are busy planning for IDDBA in June. We will be sampling all of our products but with a focus on the product ranges delivering most growth – and therefore presenting the biggest opportunity for retailers to drive sales.
Brand awareness is up. Brand sales are up. As the brand rises, so does our investment in it, with increased marketing spend, additional budget allocated to data and insight to keep us ahead of the competition and continued investment in product quality. Trade shows are a great way for us to demonstrate the value St Pierre adds for retailers and shoppers alike, by delivering a quality experience, every time
St Pierre will be at IDDBA from June 4-6 in Hall E, Booth 1301. For more information, visit stpierretrade.com.