Progressive Grocer Product

Spring 2015

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3 8 Progressive Grocer Products Showcase / Spring 2015 BAKERY indulgent, treats, this category abounds with opportunity. Following the bankruptcy of Hostess, this segment generated some buzz as people mourned the potential loss of legacy brands and items they had long loved in childhood, into adulthood and for their own families. And the ultimate relaunch of the Hostess brand again created buzz and has amplified competition in this segment. According to Mintel's Prepared Cakes and Pies report from summer 2014, a few key industry events made waves in the segment: • As Tastykake celebrated its 100th birthday and Mrs. Freshley's adopted new packaging, sales of Flower Food brands (Tastykake and Mrs. Freshley's) increased more than 20 percent from 2013-14, more than any other company in the category. • Hostess Brands marked sharp decreases, attributed to a return to more typical sales following the 2012 bankruptcy announcement that lead to a short-term increase from panicked consumers thinking the brands would no longer be available. • In 2013, Hostess sold its Drake's Cakes business to McKee Foods Corp., ultimately bringing the Hostess products back to market. PGPS IRI New Product Pacesetters New Product Pacesetters in the bakery segment include: Source: IRI, Chicago, New Product Pacesetters earned an average of $35 million in the product's first year. Kellogg's Special K Cupcakes and brownies Tastykake Kandy bar Kakes Category Share of Bakery Packaged Goods Source: ECRM, Ashville NC, Circulars Only, Effective Ad Block Count Breads; 30.66% Lunchbox Cakes; 18.89% Pasteries, Cakes & Pies; 14.29% Sandwich & Hot Dog Buns; 10.76% Rolls; 8.77% Bagels; 6.56% English Mufns; 6.47% Croissants; 0.05% Tortllas/ Pitas; 3.55% Offer Type Share of Bakery Packaged Goods Source: ECRM, Ashville NC, Circulars Only, Effective Ad Block Count Save $X; 0.41% Other; 0.29% Incentve; 0.06% Price Only; 42.04% x/For; 28.12% BOGO; 28.16% % Of; 0.92%

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