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Supermarket GROCERY Business: Cookie monsters

Americans are going kooky over cookies. And as manufacturers roll out more new entries, line extensions, health-conscious, and decadent offerings, the love affair is bound to only get stronger.

In addition to the core cookie aisle, cookies and crackers are now found at the checkout counter, deli case, and coffee bar, thanks to new consumer-friendly packaging, like Nabisco's Go-Paks, that are helping increase sales by expanding cookies and crackers beyond their center store, core aisle stronghold.

"Our Go-Paks are designed to be narrower at the bottom and wider at the top, so they can fit in car cup holders," says Larry Baumann, a spokesman for the Nabisco division of Kraft Foods in East Hanover, N.J. Nabisco offers Mini Oreo, Teddy Grahams, Mini Kraft Cheese Nips, Mini Chips Ahoy!, and Mini Ritz Bitz Sandwiches in Go-Paks, and is planning to roll out more items next year. "They offer multiple servings that can be shared with the family in the car, and they are crushproof so they can be put in a backpack," Baumann says. "So many Americans are on the go these days and are looking for a nice, quick snack, something that can satisfy their urge right now and still save some for later."

With its two-pack packages of Crème de Pirouline cookies, De Beukelaer Corp. is also looking to capitalize on the portability craze. Historically, the rolled, toasted wafers filled with hazelnut crème were sold in supermarkets in 14-ounce tins, but the new two-pack is opening up other classes of trade—convenience stores, coffee shops, service stations, and bookstore cafes. "We're also designing a display that can hold 288 pieces that we will have in the Walgreens and Publix of the world," says S. Joe Snyder Jr., v.p. at Madison, Miss.-based De Beukelaer. He says the company was founded in 1984 by Peter De Beukelaer, who moved to Mississippi from Belgium. "Our rolled wafers are made here in Mississippi, but we are looking to import some other products from Belgium in the very near future," says Snyder.

Lu Biscuits, a subsidiary of Group Danone, imports all of its cookies from France and Belgium, and it recently added the phrase "France's number one biscuit brand" to its packaging. Its most famous product is Le Petit Ecolier (The Little Schoolboy), a butter biscuit with an embossed coating of pure chocolate. "Consumers are returning to moderate indulgence, as opposed to fat-free," says Elio Pacheso, v.p. North America at Wilton, Conn.-based Lu Biscuits. "They don't want to know what is out of the product, they want to know what is in the product. I think that will continue to propel our indulgent premium product here in the U.S."

The cocoa butter standard

To that end, Lu has taken a page from Lindt, the upscale chocolatier, and is now grading its products according to their various cocoa butter content. The packaging has also been given a more upscale, contemporary look. "We are the only biscuit in North America segmenting our chocolate according to cocoa content. It is very much like you see in fine wines, cheeses, and premium coffee," Pacheso says. "That is one of the most innovative things in the cookie segment in the U.S."

Most of the category innovation is coming from line extensions. "What we're seeing rolling out is a relinquishment to the power of brands," says Steve Rotterdam, chief creative director at EastWest Creative, a New York sales promotion marketing firm that has worked with Nabisco, Jell-O, and other brands. "We're seeing less and less new products with their own personalities and brand identity, and more and more line extensions, spinouts, and partnerships. We're seeing products with flavors from other brands," he says, citing Nabisco's Cheese Nips, which were recently rechristened Kraft Cheese Nips.

"We are seeing more SKUs, but we're seeing less brands. Take Oreo, for instance, where you'll see a broader sea of blue than you may have six months ago. The defensive tactic of the Nabiscos and Keeblers of the world is to expand and just provide more and more of the shelf touch points with the consumer," Rotterdam says. "Nabisco wants to see Oreo as more than just the traditional classic black-and-white cookie, but more as a statement, a point of view, and a state of mind. It is going to be very difficult for the smaller, specialty, and gourmet brands to make inroads into the market."

But other brands have been successful. With its Home Style line of cookies, Archway has been a hit for generations. "We are doing a relaunch of the entire brand this fall, which includes a package redesign and our new Chocolate Classics sub-line," says Chip Schuman, director of marketing for Archway, a division of Parmalat Bakery Group, Bolingbrook, Ill.

Chocolate Classics encompasses Fudge Brownie cookies, Chocolate Chip Brownie cookies, Peanut Butter Cup, Chocolate Chunk Toffee, Candy Chip, and Chocolate Candy Bar varieties. "The overall category is all about chocolate," says Bill Lunz, director of marketing for Parmalat Bakery Group. In addition to Archway, Parmalat owns Mother's and about a dozen regional brands, including Salerno. It does a big business in private label. "Half the dollar sales for all cookies derive from chocolate or chocolate-based cookies. America has, and probably always will have, a love affair with chocolate in any way, shape, or form," he says.

That love affair will be put to the test next year when chocolate prices are expected to skyrocket because of political unrest in the Ivory Coast, a key cocoa-growing region.

"Trendwise, we are seeing a growing merger of candy and cookies," says Lunz. "It is what people are wanting. There are little treats and surprises in every cookie. It is an indulgent break from the routine. On my desk I have a dozen different types of candy that are not chocolate, but that we are considering for inclusion in our sugar cookies, etc. The cookie becomes a nice carrier for candy."

In addition to Chocolate Classics, Parmalat recently launched Mother's Blasters, a chocolate sandwich cookie with a Pop Rock-type candy in the filling. "Blasters are designed for the pre-teen/teen market," Lunz says.

Mother's flagship product, Circus Animals, is designed for children, but is popular with all ages. In July, Mother's made the first Circus Animals line extension in several decades when it introduced Fudge Circus Animals. "We realized that chocolate is so significant that we went back in and looked at our standard pink-and-white Circus Animals and thought, 'What if?' Sometimes you don't want to touch the icon, but in this case it made sense. We still offer the original and they are still huge," he says. The brand is so huge that people all over the West Coast can be seen digging their hands into bags of Circus Animals for quick snacks and pick-me-ups.

Feeding the actors

Tune in to an episode of the sitcom King of Queens and you may just catch portly star Kevin James digging into a bag of Joseph's Lite Cookies, a sugar-free line merchandised in the cookie aisle, pharmacy, or bakery department. "We don't pay for placement, and a lot of celebrities actually eat my cookies, including David Spade, Kevin James, Leah Remini, Ray Romano, and Kelsey Grammer, who buys them at Gelson's," says Joseph Semprevivo, president and c.e.o. of Joseph's Lite Cookies in Deming, N.M. Joseph's Lite received its first celebrity boost when director Steven Spielberg asked for 20 cases to keep on the set of one of his movies. "Because the actors eat all the time on the set, they would rather eat something health-conscious, so little by little we started seeing our cookies on the shows," Semprevivo says.

Joseph's Lite makes a line of eight sugar-free cookies, as well as a fat-free line, marketed under the Santa Fe Farms name, a new sugar-free brownie, and a new sugar-free pancake syrup. "I'm a diabetic and that is the whole reason I started the company," he says. "We're the No. 1 selling sugar-free cookie in every store we are in. Our cookies do not contain any sugar or any other chemicals, like aspartame, NutraSweet, or Splenda, and that is one of the things customers really love about our products. We have a great taste, no aftertaste, no laxative effect, and just really clean ingredients."
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