Freshly Baked
By Jennifer Boncy
Published: July 1, 2013
Gourmet treat manufacturers are yielding treats that not only look delectable, but that also address the rigorous consumer demand for nutritious pet fare.

 


It was not too long ago that some inspired, pet-centric people started rethinking the look, feel and very definition of a pet treat. Riffing off what has long been available in human bakeries—from cupcakes, cookies and cakes to savory muffins and pastries—these pet-loving bakers introduced a new crop of pet goodies and elevated treats into the gourmet stratosphere.

Fast-forward about decade, the demand for these treats continues to surge—and evolve. In fact, today’s pet parents are looking for products that are nothing short of spectacular. They want the best of all worlds—fun and decorative, decadent and tasty, as well as healthful and nutritious.

Fortunately, manufacturers are delivering the goods to meet this demand. 

The single most influential trend in the gourmet treat category is also the most obvious characteristic that sets many of these products apart—their enticing appearance.

“While some cookies are basic, the gourmet treats have a bit more sophistication,” says Debbie Bohlken, president of Claudia’s Canine Cuisine, a gourmet dog cookie manufacturer based in Maumelle, Ark. “Their visual appearance can’t be missed, and it is the very first thing most humans notice.”

Often modeled to mimic baked goods for people, with colorful “frosting,” chocolate-like coating, custard-like fillings and other tasty embellishments, these treats appeal to people who want to indulge their pets with something special. The bonus of being able to purchase a treat that looks human-grade in presentation and composition is an irresistible draw to many.

“If a pet parent likes biscotti with their tea or coffee, then it is a sure bet that they want to share the indulgence with their pet child—except in a healthier, pet-friendly version,” Bolken says. “Therefore, they are more likely to purchase a canine banana biscotti, crème brulee, strawberry scone or doggie hound cake.”

It also stands to reason that the latest products in the gourmet treat market mirror trends that are playing out in human bakeries, notes Jessica Talley, CEO and head pet pastry chef of Bubba Rose Biscuit Co., a Boonton, N.J.-based manufacturer of dog treats. Talley says innovation in the category reflects what is hot in human pastry and cake sales. Bubba Rose, for example, added pet-friendly cake pops, cake bites and macaroons to its line up in the last year, echoing the latest innovations to pop up inside human bakery cases. 

“That crossover is a logical thing, because people are buying what appeals to them,” Talley says.

Three Dog Bakery, based in Kansas City, Mo.,  is another company adding to the growing crop of products made to appeal to human sensibilities. Its Banana Split wafers—paw-shaped banana-nut wafer cookies mixed with mini-carob-chips and cherry wafers— are sold in a clear tub and resemble cookies found in supermarket aisles. Brian Wietharn, Three Dog Bakery’s president, says these similarities are at the heart of the category’s success. Seeing the product, he explains, makes pet owners—himself, included—reminisce about beloved childhood goodies and good times.

“It brings me back to my great days of loving Oreos or growing up as a kid chomping on a box of Nilla Wafers,” says Wietharn.

Still, the category is not fueled by attractive presentation alone. With nutrition on the forefront of so many pet owners’ minds, quality, wholesome and healthful ingredients are also a must.

The gourmet treat category is impacted by the same consumer demands seen in the overall pet food market. Consumers are seeking products made with natural, nutritious ingredients that are judiciously sourced from trustworthy suppliers. And many manufacturers are heeding the call. Zuke’s Treats, a Durango, Colo.-based manufacturer, is among the still fairly elite group of companies concentrating solely on high-quality, all-natural, U.S.-made treats.

“Gourmet treat buyers are becoming much more educated about what canine nutrition is, what their dogs needs and where the ingredients are coming from,” says Chris Meiering, Zuke’s director of marketing. “Treat manufacturers that focus on high-quality, nutritional ingredients sourced in the United States will be a step ahead as consumers become more and more inclined to choose healthier alternatives.”

Many products, in fact, are boasting shorter and easier-to-read ingredient lists. Pet treat and food companies—often launched by pet lovers who found the market lacking in high-quality products—are eliminating wheat and other grains, soy, additives, and fillers.

“Dog owners have become more sensitive to maintaining the health of their pets by offering treats that are formulated specifically for their pet’s needs,” Bohlken says, adding that one of Claudia’s Canine Cuisine’s, latest introductions, Canine Sweethearts, contains no wheat, soy, corn, by-products, and artificial colors and flavors, and offers the added benefit of being formulated to support a dog’s urinary tract health.

Manufacturers such as West Wareham, Mass.-based Preppy Puppy are also sensitive not only to dogs’ nutritional needs, but to their owners’ desire for high quality.

“We purchase all ingredients from U.S. companies,” says Amy Singelais, a partner at Preppy Puppy. “We also only use ingredients a human bakery would use. We follow all human-food manufacturing standards, as well as food-labeling laws. Dogs can be assured they are getting the same quality in a dog treat as their human is getting at a bakery.


Worth Every Dime
Higher-quality ingredients and products, however, often translate into higher price tags. The good news is that pet owners are amenable to paying more for gourmet treats trending on the market.

“Pet lovers are often willing to pay a premium if they know they have found a treat their dog loves that is made with high-quality ingredients, and that provides them with a healthy, nutritional snack that’s made in the USA,” Meireing says.

Teresa Koch, CFO of Pup-O-Licious, a Quincy, Ill.-based maker of all-natural dog treat mixes that pet owners can bake themselves, concurs.

“If the ingredients are preservative-free, all natural and not made in China, customers are willing to pay premium for healthy treats for their family member,” she says.

Of course, consumers’ price tolerance varies greatly depending on the type of treat. Gourmet treats being sold in pet specialty stores may still sell for more than treats sold on supermarket or  big-box retailer shelves without ruffling feathers. But there are limits to what many shoppers will spend on an everyday basic bone or biscuit or an impulse item that can be consumed in a minute or less.

“The economy seems a little stronger, but there is a slight resistance to surpassing the $3 retail [price] on an individual bone in most markets for everyday items,” says Singelais. “Many of our items are priced for the small store to make their margin requirements and meet consumers’ pricing thresholds. We try to offer a range of prices meet a wide variety of needs.”

Special events, however, can lower consumers’ defenses. Customers will spend more on decorated, special-occasion goods—which explains why, in part, even in rough times, the gourmet treat trend surges on.

“I think the market has maintained itself through the down economy,” Talley says. “Birthday has been the key segment to this market—birthday treats are the driving force behind the decorated goods segment. Holidays come in second.”

The decorated and special occasion treat category is so hot, in fact, that retailers outside of pet specialty have also taken note and are poised to claim their percentage of the market share.

“Ice cream and doughnut shops are noticing the trend of dog parents wanting to treat their dog to a goodie, as they are treating themselves to a human treat,” says Christine Boothe, national sales manager for Englewood, Colo.-based Pawsitively Gourmet, a gourmet dog treat company. “Pawsitively Gourmet has experienced a rise in the number of shops—other than pet stores—ordering our delightfully decorated treats.”

These retailers are not the only ones eyeing the sales opportunities in the treat category. Grocery and big-box chains of all kinds are hoping to benefit from the impulse purchases gourmet treats can generate—especially when strategically placed near registers.

Mark Callahan, vice president of sales and marketing for Denver-based manufacturer Fido’s Cookies, says representatives from a range of retailers are attending trade shows in search of trendy pet treats. “Pet treats are going in very untraditional markets, such as hardware, and it makes perfect sense—if you are in Home Depot or Lowe’s to pick up a hammer or some plants and you are near the check-out counter, you may think let me pick up something for my pup.”

And with pet-related gift giving becoming increasingly popular, more retailers are looking to stock festively decorated gift-packaged goodies that sell particularly well in the fourth quarter, Callahan points out.

But if pet specialty retailers can no longer monopolize the field in this category—particularly with seasonal and special-occasion treats—they will have to be sure to differentiate themselves. Wietharn advises independent pet specialty retailers to complement assortments of everyday basic treats with more specialized options—and always keep it fresh.

“Consumers want diversity; they don’t want the same thing everyday,” he says. “So, my recommendation is to keep the main everyday core line of treats, but don’t be afraid to bring in new flavors, shapes and other treat profiles based on seasonality. We do a lot pumpkin and sweet potatoes in the fall, for example, and in the spring, we have strawberry cremes that come in a till like you would get in grocery store.”

Bohlken adds that pet specialty stores can maximize the potential of the category—while also setting themselves apart from larger competition—through thoughtful merchandising.

“Handling the individual treats as though they are a true bakery treat or displaying packaged treats in such a way to capture the consumer’s interest has it rewards,” she says, explaining that showcasing treats in a typical bakery style “makes an instant connection in the mind of the customer to ‘gourmet’ items.”

Retailers may consider setting up a bakery-themed endcap with corresponding signage, for example, she suggests.
“Pet stores that recognize these treats as gourmet or upscale,” says Bohlken, “can quickly capture this growing market.”