Bagel Trends

While many categories of the baking industry can survive consumers’ current obsession with health and others can hide safely behind their indulgence, bagels find themselves trapped in the middle.

As the team from Always Bagels in Lebanon, PA, put it, a bagel is a bagel, which means carbs and calories. Even whole grain, fiber-packed attempts at added nutrition carry a calorie count that scares off consumers today. While items such as cake and cookies can enjoy their treat status, and loaf bread can benefit from whole grains, bagels still must contend with their rotund size and everyday breakfast positioning.

“Cake is a treat item,” explained Joe Latouf, executive vice-president, Harlan Bakeries, Indianapolis. “It’s indulgent. People are going to have dessert on the weekend or maybe once or twice a week, but to have something in the morning, every morning, people are more cautious.”

This precarious position has the bagel field staring down flat sales, and bagel bakers looking for new ways to jump start sales momentum. According to data from IRI, a market research firm based in Chicago, for the 52-week period ending Jan. 26, the entire bagel category only grew 2% in dollar sales and 2.8% in unit sales, with private label seeing the biggest boost at 9.1% growth in dollar sales. Shrinking the bagel’s size to reduce calorie and carb counts, cleaning up ingredient labels and reenergizing old channels with new promotions and creative uses for these rolls all provide opportunities to bring new life to the breakfast product.

Addressing nutrition concerns

The main drain on bagel sales today is the health trend sweeping the entire food industry as the bagel is packed with carbs and calories, two words consumers shy away from these days.

To combat this image and quiet consumers’ fears, bakers have succumbed to pressure to shrink the bagel. Where a traditional New York-style bagel originally weighed in at 5 oz, most current bagels now weigh 4 oz. Other bakers have taken the shrink solution even further by creating bagel thins and mini bagels.

Always Bagels’ junior bagel, a 2-oz product, has found success meeting the demands of school cafeterias. While school lunch programs struggle to meet new whole grain content requirements and the picky tastes of students, Always Bagels offers a bagel half the size of normal bagels. Outside of schools, these smaller varieties also meet consumers’ growing need for grab-and-go breakfast and snack options.

While shrinking the massive product’s size may address issues of carbs and calories, it doesn’t address consumers’ concerns over ingredients and nutritional value.

Harlan offers consumers a high fiber, low carb bagel that appeals to those who are cautious about what they eat. “Our Carb Check Bagel is a unique item that has developed a passionate following around the country,” Latouf said.

Clean-label, GMO-free, gluten-free and sprouted grains all have wiggled their way into the bagel category as opportunities disguised as challenges. While formulators continue the fight to develop a tasty gluten-free bagel, sprouted grains are providing a halo of health to the wheat-dense product in a wheat-hostile world. Panera Bread Co., St. Louis, introduced sprouted grain bread products, including bagels, to its menu, making it one of the first restaurant chains to do so, according to Tom Gumpel, the company’s head baker.

“Sprouted grains are a good source of fiber and rich in taste,” Gumpel said. “This is another nutritious whole grain that Panera is making accessible to its customers in popular bagel form. It’s an incredible step ­forward for our bakeries.”

Aside from sprouted grains, Harlan Bakeries found that clean label is something its customers continue to inquire about, but this approach continues to challenge formulators because of very short shelf life. “Shelf life is either earned through preservatives or very expensive formulations with natural preservatives,” Latouf said. While he expects the industry will eventually move to a clean-label reality, consumers will have to step up and actually be willing to pay for it.

Drawing in consumers

Supermarket shoppers have many options for buying bagels — the commercial aisle, in-store bakery, freezer cases. Currently, however, bagel sales seem to be converging in only the commercial bagel aisle. While in-store bakeries were once an outlet for premium bagels, shoppers are seeking these breakfast breads in the center of supermarkets.

According to Latouf, Harlan Bakeries has seen its in-store bakery business shrink and freezer case bagel volumes fall while all those sales migrate to the bread aisle. According to IRI data, Pinnacle Foods Group, Parsippany, NJ, saw sales of its brand Lender’s, the leader in frozen bagels, fall 14% in the 52 weeks ending Jan. 26. The second-largest frozen bagel brand, Ray’s New York Bagels, experienced a 12% drop, and dollar sales for the overall frozen bagel category were down 6%.

In a category scrambling to find its footing, bakers can gain a foothold by getting back to basics in the in-store bakery and promoting quality and value instead of trying for the health angle.

“There can be some growth in the in-store bakery in those chains that are willing to take a step back and look again at baking fresh,” Latouf said. Some retailers, for example, continue to see success with bagels in its in-store bakery while so many others flounder — a success Latouf directly attributes to the fact that employees bake those bagels fresh. Most in-store bakeries today use thaw-and-sell products that may be the easiest to get on the shelf but not the easiest to sell.

The team at Always Bagels agreed that in-store bakeries should continue to cycle-bake fresh in their bakeries and added that promoting superior quality can bring people in and keep them coming back. If the bakery promotes its bagels as a quality product and the consumer tastes and recognizes the quality, they’ll buy it again and again. For Always Bagels, quality means a New York-style bagel with a lot of shine, chewiness and moisture — all attributes earned through the bakery’s process.

To ensure its bagels see success in the in-store bakery, Always Bagels works with its customers to help them promote and bake its bagels properly to draw in shoppers and keep them there. Those customers who see the most success, the most growth, the team said, are those that support the category with promotion and deliver what consumers want: great quality at a good value. Those who don’t promote and don’t address those consumer desires are the same ones who continue to see flat and declining sales.