AUGUST 16, 2013

By Michael Stone

If you’re reading the news, it may appear as though Cronuts have taken the country by storm. While they’ve certainly amassed a large following, Cronuts are still only available, at least for now, in Dominique Ansel’s bakery in SoHo New York. I still haven’t tasted one myself, but as a New Yorker, believe me when I say that they’re all the rage. In case you don’t know, a Cronut is a cross between a doughnut and a croissant. Think of circled layers of croissant (with a hole in the middle) with the outside texture and cream or glaze of a doughnut.

Dominique Ansel Bakery introduced the Cronut in May 2013. Demand was high in the beginning, but they became immensely popular moving into summer. It’s not every day that a Cronut-like niche in the market is discovered, so I give a lot of credit to Ansel for his ingenuity, but more importantly, his intuition for taking the necessary steps to protect the name by registering the trademark, thereby positioning it to become a brand. I guess he’s more than just a baker and thinking ahead!

However, while New Yorkers were enjoying the sweet taste of Cronuts, the rest of the world, (including us New Yorkers), was still battling withdrawal from the disappearance of one of the most iconic and tasty snack cakes ever created. Twinkies.

Lucky for Twinkies, Americans’ obsession with hybrid-baked goods may have helped fuel what is shaping out to be an impressive product comeback. Or, in the words of Hostess, “The Sweetest Comeback in the History of Ever,” which is what the company is calling the Twinkies  “return” campaign. For a brand that has been around since 1930, nostalgia can be a very powerful marketing tool. In spite of this, Hostess is making some subtle, yet fairly drastic, changes to its product and marketing strategy. With C. Dean Metropoulos & Co. at the helm, Twinkies are now in smaller, more snackable sizes and targeted at males 18-35. Hostess is trying to engage this audience through a social media campaign named www.prepareyourcakeface.com, which is meant to engage social savvy consumers by asking them to post Vine videos of themselves getting ready for the Twinkies re-launch. But Hostess isn’t forgetting the older generation who turned Twinkies into a staple of packed lunches. It’s also adding new flavors, textures and gluten-free, bite-sized, low-sugar and fiber enriched options to renew interest in the product as a versatile snack.   And, although many brands that have departed the marketplace have had difficulty coming back (Kodak, Pan Am, Linens ‘n Things, among others), Twinkies has consumers clamoring for the products, which have also not been gone that long. (Twinkies disappeared from the shelves in November 2012.)

Truth be told, Hostess and Cronuts are more similar than you may think.  Cronuts already exhibit similar telltale signs of long-term brand potential and could learn a lot from what Twinkies, a veteran in the category, has accomplished.

One of a Kind Product

One of the most admirable qualities of both is that that they’re utterly unique and boast an adoration that sometimes borders on obsession. What other snack besides Twinkies can claim that Sergeant Al Powell from “Die Hard” could name every ingredient in it? Twinkies are iconic and 80+ years after the product hit the market, they’re still entrenched in pop culture. Cronuts capture some of that uniqueness, and mark my words; it’s only a matter of time before Dominique Ansel is approached to reference them in a movie.

Extremely High Demand

Retailers reported to Hostess that when Twinkies hit store shelves again in July, they sold out within hours. In fact, during the Twinkie recession a black market emerged on eBay where a 10-pack could be purchased for $24.99 and four 10-packs for $99.99, according to Bloomberg. Currently, Dominique Ansel makes a little more that 250 Cronuts daily, nowhere near enough to meet the demand of the throngs of people who line up outside his SoHo bakery each morning.

Potential for Wider Distribution

Twinkies are already recognized worldwide, but Cronuts are still hyper local. However, there’s immense potential, not only because of the growing popularity of Cronuts, but by Ansel’s wise decision to trademark the name. Dunkin Donuts already attempted a Cronut knock off in South Korea, which is evidence that there’s true value in the name and the product. With demand increasing and the name becoming better known, licensing could become a viable option to broaden distribution and make Cronut a household fixture.

Product Flexibility and Playfulness

With Twinkies, there’s room for twists and interpretations that allow them to move into the high-end pastry category. Several bakeries in New York including Chip Shop, Empire Cakes and Red Velvet put their own twists on Twinkies, creating new flavors and ways for customers to experience them. Cronuts could be a similar type of blank canvas, allowing people to try Cronuts in new ways, whether in bakeries or among do-it-yourselfers at home with licensed kits or their own recipes.

I’m sure I speak for others when I say I will be watching Cronuts and Twinkies closely, if not personally buying a new flavor of Twinkie and finally getting my hand on a Cronut.