The Cake Industry: The Importance Of Market ResearchPosted 07/05/2010 by Mary Horgan
Few can have failed to notice the increased popularity of the cupcake in recent years. Once considered a distinctly American tradition, it has been embraced in the UK. Some pinpoint a particular episode of Sex and the City in which Carrie and Miranda sit outside New York’s Magnolia Bakery as the catalyst for the humble Cupcake’s rapid rise to fame.
The cupcake, however, is no longer humble. From strawberries and cream to bubblegum, black forest to glittery and green, mini to oversized, the cupcake can now be purchased in a myriad of flavours, sizes and styles. As well as offering the sweet toothed a moment of sugary escapism, the cupcake and its counterparts are also big business. To succeed in the cake baking industry, knowledge of cakes’ current commercial context, an insight into the competition and an understanding of target audiences is vital.
Crucial Context: The Cupcake Boom, The Media & Product Trends
Women’s and lifestyle press have seized upon the cupcake, championing it as the ultimate treat that balances indulgence and restraint. Before launching your cake baking business, take time to explore how the media is discussing baked products. This will help you to decide which products to sell, what sort of brand image to create and who to market your cakes to.
The fashion business has also fallen for the cupcake. Photo shoots, after show parties and press days all see their fair share of baked goods. Ex model Lorraine Pascale’s career shift to owner of Covent Garden’s successful Ella’s Bakehouse has been widely covered in the media. If appropriate, think about how you can align your business with such trends. Could you cater for fashion parties, for example? On a more basic level, will you consciously opt for a fashionable colour scheme, logo and Website Design for your Cake Baking Business?
Hot on the tail of the cupcake, another sugary American export, the whoopie pie, has also garnered its fair share of attention. A cross between a sponge cake and a cookie, it is being hailed as the current It cake. Keeping a close eye on confectionery trends such as this will help you to stay ahead of the game.
The shifting media and consumer culture surrounding cakes and confectionery has opened up new areas of custom for those running cake baking businesses. The fashion crowd, for example, now sizeable consumers of cake, would not previously have been a target audience for the baking industry. Think carefully about the sorts of ‘tribes’ that are now switched on to cake as a consumer product. Many children’s birthday parties boast colourfully decorated, themed or character cakes, ordered especially, often at a high cost. Day spas and beauty parlours often offer their customers a cupcake and a cup of fine tea to complement pedicures, manicures and massages.
- How can these new avenues be tapped?
- What type of consumer should you be reaching out to?
- What sort of businesses should you be forging relationships with?
Take time to think about your local area and the unique opportunities for custom it holds.
Analysing The Competition
In assessing your competition, there are two key things to keep in mind. Firstly, you should seek to learn from your competition. See what they are doing well and think about ways in which you can be inspired by their success.
- Do they offer excellent customer service, for example?
- How might you go about ensuring that your customers are treated to even higher standards of communication?
- you should also strive to set yourself apart from the competition. How can you mark out your business as unique?
- Can you offer more exciting products that your peers?
- Are you keen to design show stopping packaging that makes your customer’s experience a special one?
When it comes to pricing your products, a considered assessment of your competition is vital.
- If a local company is offering cakes at a low price, can you match that?
- If you need to charge more, how can you mark your wares out as luxurious, premium products worth paying a little more for?
Crucially, the rise in media coverage of and consumer demand for baked products has paved the way for exciting business opportunities. The confectionery industry, along with the coffee trade and pampering business, has been highlighted as a key success area for those looking to start out on their own. To secure success, however, careful and thorough market research should be carried out.