Cookies Market Analysis

Cookies Market (Global, 2024)

Introduction

The market for cookies is evolving rapidly, influenced by changing consumer tastes and the increasing demand for new products and more healthy variants. As consumers become more health-conscious, there is a noticeable shift towards cookies that contain natural ingredients, reduced sugar and extras such as fiber and protein. Moreover, the rise of e-commerce and online grocery shopping has transformed the way that cookies are marketed and sold, enabling companies to reach a wider audience and target niche markets. In addition, social media and food trends have had a significant impact on the cookie market, with visually appealing and unique cookies proving popular. These developments offer both challenges and opportunities for manufacturers, retailers and new entrants.

PESTLE Analysis

Political

The biscuit market in 2024 is influenced by various political factors, such as government regulations on trade. A tariff on imported sugar in the United States has increased the cost of raw materials for the biscuit industry. The current rate of taxation on sugar is 15%, which has an effect on the total cost of production for companies which use imported sugar. The Food and Drug Administration has also introduced new labelling requirements for food, including biscuits. All ingredients must be clearly stated on the label, which will lead to an increase in production costs.

Economic

In 2024, the average household in the United States has an income of about $ 78,500, an increase of 3.5 percent over the previous year. The increase in disposable income will stimulate the demand for premium and special biscuits, because consumers are more willing to indulge in expensive products. In addition, inflation is expected to stabilize at about 2.1 percent, which is important for the biscuit industry, which depends on consumers' discretionary spending.

Social

In 2024 the tendency towards a healthier diet is to be seen in the growing popularity of snacks, with 62% of consumers opting for a low-sugar or natural cookie. The manufacturers of cookies are forced to respond to these changing demands by modifying their formulations. A tendency towards a vegetarian diet leads to an increase of 25% in the production of vegetarian cookies, which is in line with the wider social trend towards a healthier diet and greater concern for the environment.

Technological

The cookies market is a very important one, especially in the field of production efficiency and product innovation. In 2024, the automation rate of production increased by 30 percent, reducing labor costs and improving product quality. And the baking process has been improved by 20 percent. The baking time is shortened, and the trend of the market is more flexible.

Legal

In 2024, the cookies market will be influenced by the legal environment. Legal factors influencing the cookies market in 2024 are food safety regulations and labeling laws. In 2024, the Food and Drug Administration (FDA) will inspect food production facilities more frequently to ensure that food is produced according to the required safety standards. New labeling laws require manufacturers to clearly label cookies containing common food allergens such as nuts and gluten. This could lead to an increase in production costs for companies that have to implement new labeling systems.

Environmental

The biscuit market is becoming more and more influenced by the environment. A total of seventy per cent of consumers prefer to buy products that have been sourced sustainably. In 2024 the demand for organic flour has risen by 40 per cent compared with the previous year. This trend is pushing manufacturers of biscuits to adopt more sustainable practices, such as reducing the amount of packaging they use and choosing more sustainable materials, in response to consumers’ demands and to government regulations that are designed to reduce their impact on the environment.

Porter's Five Forces

Threat of New Entrants

In 2024 the market for sweet biscuits is moderately threatened by new entrants. The relatively low cost of setting up a biscuit business makes it easy for new entrants to enter the market. But the need to meet food safety standards and the difficulty of gaining a foothold against well-established brands may deter some would-be new entrants.

Bargaining Power of Suppliers

The suppliers of the cookie industry have low bargaining power, owing to the abundance of raw materials such as flour, sugar, and chocolate. There are many suppliers for these materials, which means they have no power to influence the price. Also, many of the cookie manufacturers can easily change suppliers without incurring any great costs, which further reduces the suppliers’ bargaining power.

Bargaining Power of Buyers

High - The buyers in the cookie market have high bargaining power, because they have a lot of choice, and many different brands and flavors. Because of the increasing popularity of health-conscious and specialty cookies, consumers have become more demanding and have been able to demand higher quality and lower prices. Competition between the brands gives the buyers power over the suppliers.

Threat of Substitutes

The threat of substitutes on the cookie market is moderate. While cookies are a popular snack, there are a number of alternatives, such as cakes, pastries and healthy snacks like fruit and granola bars. The trend towards healthy eating may push consumers towards these substitutes. But cookies are still very much a matter of taste and nostalgia, and this mitigates the threat of substitutes.

Competitive Rivalry

Competition in the cookie market is high, and many established brands and new entrants compete for market share. Competition is based on many factors, including quality, variety, packaging, and price. The presence of large companies and small, artisanal bakers intensifies competition as they all try to differentiate their products and grab consumers’ attention.

SWOT Analysis

Strengths

• Strong brand loyalty among consumers for established cookie brands.
• Diverse product offerings catering to various dietary preferences (gluten-free, vegan, etc.).
• Growing trend of premium and artisanal cookies attracting higher price points.

Weaknesses

• High competition leading to price wars and reduced profit margins.
• Perception of cookies as unhealthy snacks may limit market growth.
• Dependence on seasonal sales peaks, such as holidays, for significant revenue.

Opportunities

• Expansion into emerging markets with increasing disposable income.
• Innovative flavors and ingredients to attract health-conscious consumers.
• E-commerce growth providing new distribution channels and customer reach.

Threats

• Rising costs of raw materials impacting pricing strategies.
• Health trends shifting consumer preferences away from sugary snacks.
• Increased regulatory scrutiny on food labeling and health claims.

Summary

The cookie market in 2024 will be characterized by a high degree of brand loyalty and a wide range of products. However, the market will also face challenges such as high competition and health perceptions that could limit growth. Opportunities will arise in the form of expansion into new markets and product innovations. Threats such as rising costs and changing customer preferences will have to be managed strategically. The companies that take advantage of their strengths and manage their weaknesses and threats strategically will be best positioned for success.