Sweet for my Sweets
Somebody should write a book on America's serial fixations with one type of dessert, and what each says about the periods of infatuation. The romance with frozen yogurt in the 1980s (think TCBY) gave way to a love affair with donuts in the 1990s (hello, Krispy Kreme), before the gourmet cupcakes in the 2000s. New York City's Magnolia Bakery is widely credited for firing up the last trend, thanks to a cameo in Sex and the City in the summer of 2000.
A year ago, The Wall Street Journal pronounced that "the gourmet-cupcake market is crashing," citing the financial travails of maybe the poster child of that market, Crumbs Bake Shop, another New York City-based purveyor of gourmet cupcakes that went public on the Nasdaq exchange in 2011. Like Krispy Kreme before it, Crumbs expanded too quickly, and its shares had fallen from $13 in mid-2011 to $1.70 by April 2013.
On Monday, Bloomberg Businessweek published what might be considered the gourmet cupcake market's obituary, focused on Crumbs. The high-end cupcakerie, which has closed 17 locations since last year, is now trying to reverse its fortunes by selling its high-priced cupcakes —which cost up to $4.50 a piece — and other baked goods in lowly supermarkets and club retailers like BJ's Wholesale.
What soured consumers on gourmet cupcakes? "It's a short-term trend and we're starting to see a real saturation," Chicago food industry analyst Darren Tristano told The Wall Street Journal a year ago. "Demand is flat. And quite frankly, people can bake cupcakes." (They can also brew their own coffee and make their own hamburgers, of course.) It seems that the high-end cupcake's moment has just come and gone. So what's the next craze?
The Cronut, obviously. And here's the epilogue: Crumbs is banking its future on a croissant-donut hybrid called the Crumbnut. The obvious knockoff of Dominique Ansel's fried croissant is "the last great thing that we put out there," Crumbs CEO Ed Slezak tells Businessweek. "We believe that trends in food can and should be enjoyed by all."