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Cupcakes: little treats offer big opportunity

Supermarkets and café chains have lost some of their passion for cupcakes – but this gives bakery shops a chance to pick up the slack

Miniature frosted cakes have taken the UK by storm in the past 10 years. The market is flooded with cupcakes in retail, foodservice, the home-baking sector and specialist cupcake stores.

But times are changing. Some major café chains have stopped selling cupcakes, while supermarkets are stocking fewer lines. Retail sales of cupcakes have fallen for the second year running in volume terms, according to Kantar Worldpanel (see box), although higher price points have driven a surge in value sales.

The reduced presence of cupcakes in some channels is actually good news for bakers, suggests Margarethe Schneeweis, European category market leader for pastry mixes at CSM Bakery Solutions. Consumers have lost interest in being “constantly bombarded” by mini cakes, but bakers can take advantage of the decline.

“Don’t assume cupcakes won’t sell – the fact customers can’t buy cupcakes in a standard supermarket means they are more likely to buy them in a bakery setting,” she says. “This now means cupcakes are a less accessible, more luxury item,” she says, adding Brits still have an appetite for cupcakes.

“Particularly in demand are those that are freshly baked and creatively decorated, as opposed to standard shop-bought cupcakes available in retail. Offering a range of good-quality cupcakes with a variety of new flavours is a way to appeal to consumers.”

Cupcakes are well placed to tap demand for small sweet treats, she adds: “Muffins and doughnuts are seeing growth in bakery, but the size of the treats can be a barrier for health-conscious consumers.

“Mini cupcakes are a sweet treat, and their dainty size means there is less sugar and fewer calories than a larger muffin, giving consumers another reason to buy them.”

Key to success in cupcakes is offering something “above and beyond” what consumers might find elsewhere, suggests Jacqui Passmore, marketing manager UK and Ireland at Dawn Foods.

“While it is essential the sponge in a cupcake is soft and moist, there’s no doubt that cupcake attraction is down to the eye-catching icing, frosting and decoration. Interesting icings, toppings, fillings and frostings can turn a basic cupcake into an indulgent treat and, in recent years, there has been a trend for premiumisation in the cupcake category.”

She adds there is value to be found in keeping lines fresh and seasonal: “The key to a successful cupcake business is for the baker to regularly introduce new lines and themes – seasonal treats, for example – and communicate that bespoke designs can be made for birthdays and celebrations.

“Profit margins are good and effort is relatively low if bakers use the array of easy-to-use options available to them”.

These include looking at trending flavours for inspiration, says Schneeweis. “Popular flavours this year include cream cheese, toffee, and salted caramel. Chocolate is the most popular, including chocolate fudge, truffle, dark chocolate and white chocolate.”

She adds that spicy flavours such as cinnamon, ginger, mandarin, cardamom and chai spices are popular, as are floral combinations including blueberry/hibiscus; orange blossom/vanilla; and raspberry/lavender.

When it comes to flavours, cupcakes aren’t just for children – with two-thirds of retail cupcake sales going to childless households (Kantar). Schneeweis suggests “appealing to adults with alcoholic notes and baking cocktail cupcakes such as piña colada or mojito, and appealing to childhood nostalgia with flavours such as marshmallow or root beer.”

Edible flowers take root on supermarket shelves

Floral flavours are growing in popularity – and the trend has been given a colourful and high-profile push by Sainsbury’s.

This summer, the retailer, which has been ramping up its sweet bakery activity in recent months, has introduced a range of edible flowers that can be used as a topping on cakes.

Available now, the flowers are grown by producers in the Vale of Evesham and sold as part of the Sainsbury’s Salad Bowl range. Priced at £3 a punnet and displayed on the fresh herbs fixture, the brightly coloured edible blooms include varieties such as tagete marigold, monkey flower, viola and dianthus.

Sainsbury’s is also tapping demand for alcohol-inspired flavours (see below) with the recent launch of home baking flavourings, Gin & Tonic and Prosecco. Bakers should add half a teaspoon of flavouring to frostings, buttercreams or the bake itself to give a “grown-up twist”, according to the retailer.

The launches come a few months after Sainsbury’s announced a 12-store partnership trial under which it sells Patisserie Valerie products on its counters. The handmade cakes and pastries are made and delivered by Patisserie Valerie in the morning and sold in the brand’s own presentation boxes by the supermarket.


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