Gluten Free Cookies: How Many Are too Many?

Recent headlines read: “You can pre-order Girl Scout cookies online” (including gluten free Toffee-tastic™) and “Liz Lovely Gluten Free Vegan Cookies Selling For $2.50 Each.” It reminds me of just how far gluten-free products have come in a fairly short period of time. When I was diagnosed with Celiac Disease some 15 years ago, most retail workers (generally speaking) looked at me with a blank stare when I asked about their gluten-free offerings. But in the past half decade or so, the popularity of the gluten-free diet has dramatically increased.

One consumer benefit is the massive uptick in great-tasting gluten-free products – yes, including packaged cookies and other baked goods and mixes – now available on retail shelves. For example:

• Tribeca, NY-based Goodie Girl Cookies debuted in 2010 and continues to gain steam, distributing not only through local New York-area outlets but a growing roster of mainstream national retailers as well, including Kroger, Target, The Fresh Market, Walmart and Whole Foods.

• Dallas-based Hail Merry, founded in 2008, now sells products nationally at Costco, Hannaford, Wegmans, Whole Foods, and other natural and specialty grocers, such as Fresh Thyme.

• In summer 2015, homegrown gluten-free baking mix brand Among Friends of Ann Arbor, Mich. secured distribution deals with Kroger, Publix and Target. The brand is now available in an estimated 5,500 stores nationwide.

• And the aforementioned Liz Lovely Cookies – whose pitch on Shark Tank Season 4 in 2012 was rejected – continues to grow beyond its Vermont home base. Its product is now available in several national grocery chains, including Wegmans, Whole Foods and Safeway.

This new product proliferation is a gluten-free dieter’s dream: More options available for those with celiac disease, non-celiac gluten sensitivity (NCGS) and the many other Americans choosing a gluten-free lifestyle. For now and into the foreseeable future, gluten-free shoppers can rejoice at the choice.

Key Takeaways

• Going forward, expect the rapid increase in new specialty product introductions will eventually lead to consolidation, an uptick in merger & acquisition activity, and some shake-out in the long run.

• Don’t think that big national brand marketers will sit idly by and watch a high-growth, albeit niche, category and related market share slip away to small lesser-known start-ups.

• We expect a growing roster of big consumer packaged goods manufacturers will explore, experiment with and enter the gluten-free space – some through grass-roots efforts, others through acquisition. Some M&A activity worth noting: last year’s Mondelēz International/Enjoy Life Foods deal and Pinnacle Foods acquisition of Boulder Brands, which closed last week.