No Longer A Big Apple Exclusive, Magnolia Bakery Moves into CPG
Two decades after Magnolia Bakery shot to fame after its signature cupcake was featured on HBO’s Sex and the City, the bakery is trying to be known for a different sweet treat: cookies
This week, Magnolia is launching its first CPG product – Banana Pudding cookies, available in three flavors: Classic Vanilla with White Chocolate Chips, Chocolate Chunk, and Confetti with White Chocolate Chips. The cookies are now available at The Fresh Market and Harris Teeter, as well as on Amazon. Each 4-pack of 57 gram cookies retails for roughly $7.99.
“Cookies are only the beginning…The cookie category is ripe for disruption and in soft-baked specifically, there was no clear category leader bringing innovation and formats the shopper was looking for,” Magnolia CEO Bobbie Lloyd said. “Expanding into grocery is [just] another piece in our consumer experience flywheel, creating moments of joy and indulgence through grocery that can create excitement and desire to visit one of our bakeries or order one of our finished baked goods online.”
Getting adequately prepared for a retail launch has taken the company over two years, she added. These efforts included building Magnolia’s leadership team, bringing on former Chobani exec Eddie Revis as CMO, as well as late last year, refreshing the company’s branding, logo and packaging.
“The ultimate goal [of the rebrand] was to future-proof our brand for where it was going in the next 25 years,” Revis said. “We definitely considered and tested the new identity like logo, color palette and typography in our brick-and-mortar, D2C channel and especially against the grocery store shelf, packaging and channels to ensure that when we did expand, our identity was distinctive and flexible enough to come with us.”
Eventually the company would like to expand beyond cookies. While on television and film the bakery is perhaps best known for its signature banana pudding and cupcakes, Lloyd said, during the holidays Magnolia’s top selling SKU online was its holiday cookie collection. Future CPG, she added, will likely carry a more premium price point compared to conventional competitors, but should still be positioned as an accessible luxury.
Magnolia’s awareness campaign and sales efforts come as the brand has a relatively new owner in RSE Ventures, which acquired the chain in the first half of 2021. At the time of the deal, RSE co-founder Matt Higgins appeared to already have a plan in place for the bakery, telling The Wall Street Journal that Magnolia would expand not only online, but also “possibly” into retail. RSE has taken a similar approach to CPG with other restaurant properties in its portfolio, such as Milk Bar and Momofuku. Milk Bar, for example, debuted its fourth CPG line of miniature, crunchy snacking cookies at Expo West.
WSJ also pointed to RSE’s investment partnership, and Higgin’s close working relationship, with digital agency VaynerMedia as one reason RSE’s portfolio company’s have been able to achieve such strong returns via D2C.
Still, the move into grocery can come with a learning curve. Stripes’ backed Levain Bakery attempted to bring its line of cookies into retail, selling a multipack of precooked, frozen cookies, but ultimately discontinued the line during the COVID-19 pandemic, citing supply chain issues and the hurdles in cold chain shipping. Meanwhile, both Levain and Milk Bar’s baked goods have sometimes been criticized by loyal fans for straying too far from their bakery-made counterparts.
Though Magnolia considered instead expanding its brick and mortar footprint beyond its current reach in New York City, Chicago and Los Angeles, Lloyd said 70% of respondents surveyed said they would prefer to buy Magnolia Bakery products in grocery stores rather than have a bakery in their hometown. To avoid such costly mistakes, she added, the company instead focuses on quality.
“One of our biggest learnings centers on consistency and persistence. We have been one of America’s most beloved bake shops for over 27 years, and as such, we have watched trends come and go,” Lloyd said. “We know how important it is to stay true to your roots, focus on creating the best product possible and doing that consistently and we’re excited to bring that same passion to our retail partners and shoppers.”
