Snack boom pushes annual cookie sales to $8.6 billion, IRI says

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Diving Brief:

  • Dollar sales in the cookie category reached $8.6 billion in the 12 months ending September 4, 2022, a 7.7% year-over-year increase, according to data shared by IRI.
  • Mondelēz International continues to lead the category, reaching $4.04 billion in annual sales, an increase of 2.5%, according to the report. Private label cookie brands totaled more than $900 million, a 16.1% increase in dollar sales over the prior year. Small brands like Belonging to Mondelēz Tate’s Bake Shop saw sales jump 31.5%, with more than $180 million in dollar sales, during the period.
  • Despite high inflation and declining volumes for the mid-store cookie category in August, cookies continue to sell strongly, with private label options continuing to gain market share.

Overview of the dive:

While several large food companies brace for a possible recession, the cookie category has remained largely resilient and its leading brands are approaching the uncertain economic situation with optimism.

In by Mondelēz call for most recent quarterly results this summer, CEO Dirk Van de Put said his top cookie brands – Oreo and Chips Ahoy – increased sales by 10.4% in the previous quarter. He attributed this to the category seeing strong sustainability due to pandemic-era supply constraints. He also attributed it to snacking becoming a more vital part of eating. Despite IRI data pointing to private label growth, the CEO also said consumers are unlikely to switch to cheaper cookies.

“Our annual State of Snacks survey shows that consumers are increasingly choosing snacks over traditional meals,” Van de Put said on the results call. “While developed consumers express growing frustration with rising prices for a wide range of goods and services, they continue to perceive chocolate and cookies as affordable pleasures and an important pick-me-up.”

But some research indicates that the fate of the indulgent category is less certain. Sweets and snacks are “high risk”, and are only expected to grow 2.2% by 2024, according to market research firm GlobalData. The company said that overall the treats are increasing in value but not in volume.

Consumers looking to avoid sugar are also sticking with their favorite cookie brands. Voortman sugarless cookie machine, purchased by Hostess brands in 2020, saw its sales jump 23.9% in the 12 months ending September 4, to $178 million. At the cupcake maker most recent earnings call, CEO and Chairman Andrew Callahan, said Voortman is responsible for about 10% of its total sales. He attributed its rise to an increased advertising push, as well as the growth of single-serving and multi-pack cookie varieties.

“Our whole portfolio is growing a lot, but Voortman has grown a lot,” Callahan said. “We are, by far, the largest part of our sugar-free portfolio. And this sugar-free sub-segment consistently increases to twice the total sugar level [cookies and wafers].”

Different types of cookies have also seen significant increases over the past 12 months. IRI’s classification of center-store cookies, offerings like those sold by Little maker Debbie McKee Foods, soared 19.4% in sales to $867 million. Perimeter cookies, sold in the bakery aisle, also saw a 17.1% sales increase.

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