Tastes change with the times, and if anyone feels the burn from the low-carb craze, it’s the bakery industry. Pressure to introduce snack cakes with conscience drives new products to grocery stores, and diet-friendly, Atkins-aware, low-cal treats share shelves with rich, fat-filled standards.
Today, less is more, says Charles Pizzi, president and CEO of Tasty Baking Co., which has satisfied chocoholics and sugar babies since 1914 with its Tastykake products. Consumers want kid-sized containers of cookies and cupcakes packaged in pairs rather than a box bulging with a baker’s dozen. Super-size is out of style.
But while trends point to trimmer tastes, consumers still crave their just desserts, Pizzi says, adding that Tastykake’s icon peanut butter Kandy Kake is still a top seller; the bakery turns out 2 million each day.
“People still want to have a sweet, indulgent moment,” Pizzi says.
The business was founded with two main ingredients in mind: taste and portability. The snacks quickly won spots in children’s lunchboxes and in pantries in New England. Today, the yum factor Tasty Baking Co.’s founders intended stands: the company wants it treats to be just as good as mom’s.
The company’s $255 million in annual sales is proof that diet fads don’t mean the end of a sweet tooth. Formerly the president of the Philadelphia Chamber of Commerce, Pizzi joined the company with a recipe to fortify the business’s branding and distribution. An advocate of business interests and regional cooperation, he introduced a new management team and an assertive plan to promote what he dubs a culture of change. New products, fun packaging and a supply chain that spokes into new cities such as Cleveland are priming the company for growth, Pizzi says.
Now, shoppers can find Tastykakes in many places — in their ice cream as a special flavor or at the Philadelphia Zoo, where Tasty Baking sponsors the Tastykake Children’s Zoo. New products and lighter, low-cal Snak Bars and Sensables sugar-free snacks appeal to the nutrition-minded market, and fun packaging is the icing on the cake.
Smart Business got a taste of what’s cooking in today’s Tasty Baking kitchen as Pizzi shares the ingredients for building a company culture that will cater to today’s evolving tastes.
Who buys Tastykake today? Are you selling to the same sweet tooth?
The people who buy Tastykake are moms who buy it for their kids — boys and girls of all ages, whether 6 years old or 60. It’s for anyone who wants a sweet, indulgent moment in time.
We have really not altered from our founders’ real vision, and that is to produce a cake that is good enough that mom stops baking and to make it portable. That was the vision 90 years ago, and we think that vision is still very relevant today.
We want to retain that vision and back it with 21st century management and technology. If you want to be relevant and nimble in a competitive environment, you have to have a culture of change. For any consumer brand product in the packaging industry, it is all about innovation.
This year, we did new packaging across our entire product line — the packaging hadn’t been changed since 1989. We wanted to make it fun and exciting and relevant to the marketplace.
It’s all about packaging and product innovation. That’s why we came out with new products like Tasty Cookies, new Snak Bar flavors, two new flavors of Kandy Kakes and added 20 percent more filling in pies and 50 percent more filling in cupcakes.
Not only are we nurturing our brand, we are leveraging it. Our highest-selling product is the peanut butter Kandy Kake. We got together with Turkey Hill ice cream, and now they have peanut butter Kandy Kake ice cream. This is only the beginning.
What tastes good to consumers these days? Are people looking for a diet-friendly way to indulge?
Overall, tastes haven’t changed, but people’s state of mind is changing, and that is where new products have to be introduced to really engage those new thought processes. Low carb may be seen as more of a blip on the screen, but the long-term view is really based on things like total calories or sugar-free foods. So, our new product line is sugar-free. Our new Sensables line (introduced in August) is half the carbs and sugar-free.
Also, we practice portion control in our packaging. With our portion control, we haven’t seen any drop-off in sales due to diet trends. In our family pack, there are two Krimpets or two cupcakes per package, so it’s not a huge portion. People still want to have a sweet, indulgent moment, and they will balance that off with exercise.
How do you make sure new snacks will appeal to the marketplace?
We are a research-based company — you can’t fly by the seat of your pants. You have to develop new products through market research. Also, you need good partners like our sales distributors, who are out in the market every day to understand people’s tastes.
We find that first and foremost, consumers want quality — great quality, good value, convenience and fun. So, we have portable fruit pies, and we are coming out with a variety of new pies with chocolate and vanilla graham cracker crusts.
We are doing new Snak Bars that are very relevant. They are 150 calories and come in chocolate chip and chocolate-chocolate chip. We tried a Boston cream and raspberry Kandy Kake, and we did the cookies in toffee and chocolate chip, which are small and really fun. Our Sensables line includes orange and chocolate chip finger cakes. They are 100 and 110 calories. We will also have Sensables donuts.
What are the key ingredients for a company that responds to new tastes?
The bakery industry is very competitive, and when you are in a competitive environment, you need the best and the brightest and the most passionate people who will drive your business to be nimble and responsive to the marketplace.
We recruited some really great people with great academic pedigrees from great brands such as Lay’s, Campbell’s Soup, Pepperidge Farm, Entemann’s, Dupont and IBM. We brought in 84 different people over the course of the last 20 months. They have great brand expertise and great integrity, so we are in the midst of leveraging our two major assets: our brand and our distributions system.
We looked at our finance and fiscal controls. We wanted to make sure our controls and financial rigor were there. Then, we created a supply chain, which we had never had before. Also, we are providing operational efficiencies as a platform for growth. It is all about nurturing the brand, and we hadn’t done any real marketing since 1989 — the packaging hadn’t been changed.
Then, we brought technology and discipline to our distribution system, working as a partner with our independent sales distributors and making sure that they understood our role as partners. Finally, we moved to a culture of pay for performance, where every employee understands that they benefit through positive performance.
The underlying key to all of these areas is communication — that is something you constantly try to achieve. For instance, I’ve met with every one of our employees. Today, we have 28 sales centers, and I made a promise to visit every one and all the sales distribution (centers) associated with them. I’ve been doing that every week or every other week.
There are five pillars that drive our shareholder value. The first pillar is brand equity. The second is product innovation, the third is building our core roots, which is our distribution center, and the fourth is entering new markets and new channels. The fifth is driving operational efficiencies.
What we are doing is a systematic approach to revitalizing a great company, and we are doing it with a new management team and an engaged and independent board.
Does your company culture reflect today’s trimmer tastes?
The first thing I did when I came here was put a fitness center in our business. When we did this, it was on CNN and ESPN. Who ever thought of having a fitness center in a bakery?
But that is what we are doing — relevant thinking based on research.
How to reach: Tasty Baking Co., (215) 221-8500 or www.tastykake.com
