Cakes Market Size (2024 – 2030)

The Cake Market was valued at USD 65.68 billion in 2023. Over the forecast period of 2024-2030, it is projected to reach USD 80.78 billion by 2030, growing at a CAGR of 3%.

Cakes hold a crucial position within the bakery sector, representing a delectable dessert that manifests in diverse forms, shapes, and flavors. The fundamental components, including flour, oil/butter, sugar, baking powder, baking soda, and optional eggs, constitute the foundational recipe for a cake. Additional ingredients may be incorporated to augment its overall appeal. The process of cake preparation has evolved, with advancements in baking equipment and streamlined recipes facilitating an uncomplicated approach, making it accessible even for novice cooks.

Throughout time, cakes have maintained a ubiquitous presence, serving as a symbolic element in commemorating special occasions such as birthdays, weddings, anniversaries, and Christmas. The tradition of cutting a cake to mark a significant milestone remains pertinent, contributing significantly to the global demand for cakes. They continue to be a favored dessert choice at restaurants and social gatherings, available both in packaged and unpackaged forms, spanning varieties like sponge cakes, cheesecakes, cupcakes, and more. A contemporary trend involves the emergence of healthier cake options, incorporating specialized recipes and alternative ingredients, such as wheat flour instead of white flour.

Key Market Insights:

Cakes maintain cultural significance, remaining an integral part of celebratory events such as birthdays, weddings, and holidays, where the ceremonial act of cutting a cake signifies a noteworthy milestone. This enduring tradition remains a pivotal factor propelling the demand for cakes. These delectable confections are prominently featured on dessert menus at both restaurants and social gatherings, available in various forms including sponge cakes, cheesecakes, and cupcakes.

The Cakes Market demonstrates adaptability to evolving consumer preferences. Factors such as Western-style baking, innovative cake decorations, distinctive flavors, and prolonged shelf life contribute significantly to the sustained popularity of cakes. The industry's growth is propelled by customizable and pre-packaged cakes, addressing a wide range of consumer tastes. The escalating pace of urbanization and increased disposable income further fuels the demand for indulgent food choices like cakes, particularly those offering on-the-go convenience and affordability.

Cakes Market Drivers:

Increasing In-store Bakeries Drives Market Growth

The proliferation of in-store bakeries is anticipated to attract a substantial consumer base, contributing significantly to the rapid expansion of the market. Various in-store bakeries across different regions are introducing products tailored for in-store consumption experiences. For example, in May 2022, Warburtons, a prominent bakery brand in the United Kingdom, inaugurated a new establishment in New York named Ellie Warburtons Cakes. This brand presents a diverse array of bakery offerings, featuring a distinctive line of premium sweet treats, specialty coffees, locally sourced teas, and an assortment of other baked goods, including a novel addition for Warburtons – a banana fruit bread.

Consumers seeking value-oriented cake products are drawn to artisanal bakeries that offer high-margin items. Preferences are shifting towards bakery products like cakes, muffins, and cupcakes, driven by their functional attributes aligning with dietary needs, such as organic, gluten-free, natural ingredients, kosher options, and the incorporation of alternative flours like chia flour and rice flour. For instance, in June 2021, Warburtons introduced two new gluten-free chocolate cake squares, featuring flavors like Chocolate Orange & Gingerbread and Raspberry & Hazelnut. This innovation has spurred a heightened demand for freshly baked cakes using organic ingredients, contributing to the global growth of the cakes market, alongside the surge in online sales and the introduction of novel products. Furthermore, a segment of value-conscious consumers is opting for affordably priced cakes from in-store bakeries, capitalizing on the convenience of one-stop shopping, further bolstering the market's overall sales.

Cakes Market Restraints and Challenges:

Health Concerns restrain the market.

The cake market encounters obstacles attributed to escalating health apprehensions, as evidenced by a 5% decline in the sales of conventional high-sugar and high-fat cakes. Growing emphasis on healthier lifestyles has influenced consumer preferences. Cakes, containing flour, pose health concerns, potentially contributing to various conditions such as Celiac disease, obesity, and elevated blood pressure.

High Prices can affect the market.

Fluctuations in the prices of essential ingredients such as flour, sugar, and dairy products can exert an impact on profit margins, posing pricing challenges for manufacturers. Remaining abreast of swiftly evolving consumer preferences and proactively aligning with food trends demands agility and substantial investments in research.

Cakes Market Opportunities:

The use of natural ingredients creates opportunities.

The utilization of natural and clean-label ingredients emerges as a substantial opportunity for market participants, anticipating a 7% growth in sales of cakes crafted from wholesome ingredients.

Transitioning to sustainable and eco-friendly packaging has the potential to elevate brand reputation and cater to the preferences of environmentally conscious consumers.

CAKES MARKET REPORT COVERAGE:

Cakes Market Segmentation: By Modes of Availability

• Packaged

• Unpackaged/Artisanal

The continuity of growth and demand for packaged cake products is upheld by innovations in packaging and extended shelf life. Packaged cakes, being more economical in comparison to artisanal counterparts, have sustained their popularity. However, there is a notable surge in the artisanal cake segment, driven by the escalating demand for freshly baked and handmade cakes. Artisanal cakes, distinguished by their ease of customization and freshness relative to factory-baked and packaged options, possess the potential to secure a larger market share in the projected period.

Cakes Market Segmentation: By Product Type

• Sponge Cakes

• Dessert Cakes

• Cupcakes

The demand for cupcakes has experienced remarkable growth, particularly among children, owing to their ease of preparation, diverse flavor and topping options, and convenient consumption. Manufacturers and bakers favor cupcakes due to their high profit margin, consistent popularity, and enduring demand. Meanwhile, dessert cakes, encompassing varieties such as wedding cakes and ice-cream cakes, continue to be favored choices for celebrations and special occasions, maintaining their status as sought-after desserts in both restaurant and party settings.

Dessert cakes lead the market, commanding a significant share of more than 49.6% in 2023. Their popularity is attributed to their versatility, offering a broad range of flavors to cater to diverse tastes and occasions. Following closely are cupcakes, appreciated for their convenience and personalized appeal, making them a favorite for small gatherings and parties. Cheesecakes have also carved out a distinctive niche, prized for their rich, creamy texture and a spectrum of variations, ranging from classic New York style to fruit-topped delights. Sponge cakes are not far behind, recognized for their light, airy consistency, appealing to those who prefer a less dense cake.

Cakes Market Segmentation: By Flavor

• Chocolate

• Vanilla

• Cheese

• Others

The Chocolate flavor segment has established a dominant position in the cakes market, commanding over a 35.6% share in 2023. The enduring popularity of chocolate can be attributed to its delectable taste, universally appealing to all age groups. Chocolate cakes, recognized for their diversity and adaptability, are frequently chosen for diverse celebrations such as weddings, birthdays, and anniversaries. The introduction of various chocolate flavors, including milk, dark, and white, has expanded the array of choices, catering to a wide range of taste preferences.

Vanilla, a classic flavor, closely follows in market share. Vanilla cakes are esteemed for their understated yet rich flavor and are often favored for their compatibility with various fillings. The simplicity of vanilla makes it a popular choice for layered cakes and custom decorations, rendering it a favorite for special occasions and professional bakers. Its versatility and widespread appeal maintain its robust presence in the cake market.

The Cheese flavor segment, primarily featuring cheesecakes, has also carved out a significant niche. Cheesecakes, renowned for their luscious texture and distinct flavor, are gaining popularity due to their unique profile balancing sweetness with flavorful cheese notes. The growth in this market is driven by the increasing popularity of gourmet and artisanal cakes, emphasizing high-quality ingredients and distinctive flavor profiles.

The 'Others' segment encompasses a variety of innovative and exotic flavors like red velvet, carrot, lemon, and more. Catering to consumers seeking novel and unique taste experiences, this segment reflects the trend toward experimentation and fusion flavors. The introduction of unconventional cake flavors meets the demand for personalized and distinctive taste preferences.

Cakes Market Segmentation: By Distribution Channel

• Supermarkets

• In-store bakeries

• Online Stores

Presently, in-store bakeries command the highest demand among all distribution channels. In-store bakeries offer freshly baked and customizable artisanal cakes, coupled with aesthetically pleasing interiors, making them consistently popular among consumers. On the other hand, the online store, with its convenient integrated delivery system, is the fastest-growing channel, particularly among the urban population. This distribution mode has experienced a substantial surge, notably during the COVID-19 pandemic. Strengthening logistics and packaging presents a significant opportunity for long-distance delivery in the Cakes Market.

Cakes Market Segmentation- by region

• North America

• Europe

• Asia Pacific

• South America

• Middle East & Africa

Europe asserts dominance in the regional cake market, holding a significant global share. The European countries have distinguished themselves with unique and delightful cake recipes and baked goods, consistently drawing the attention of both residents and tourists. The demand is further augmented by a substantial influx of gastronomical tourists in recent years. Meanwhile, the Asia-Pacific region emerges as the fastest-growing area in the cake market, with countries like Japan, Korea, and India standing out as among the fastest-growing players in the market.

COVID-19 Pandemic: Impact Analysis

The COVID-19 pandemic has inflicted a devastating impact on the Food & Beverages industry. Cake manufacturers grapple with challenges such as shortages in raw materials, labor disruptions, and supply chain and logistics issues. The retail market, particularly for non-essential items like cakes, has suffered significant setbacks, consequently affecting the overall global sales of cakes. Interestingly, amidst these challenges, the pandemic has spurred a rise in the popularity of home-baked cakes among amateur home cooks. This, in turn, has led to an increased demand for cake-making ingredients.

Latest Trends/ Developments:

November 2022: Hostess Brands Inc. has unveiled a range of sweet holiday snacks for the winter season. The offerings include the seasonal debut of Holiday HoHos, Holiday CupCakes, Mint Chocolate Flavored Twinkies, and Hot Cocoa & Marshmallow Flavored Donettes.

September 2022: Hostess Brands has introduced Hostess Bouncers, a new line of bite-sized snack cakes featuring creamy fillings. The Hostess Bouncers are available in three flavors: Hostess Twinkies, Hostess DingDongs, and Hostess Donettes.

Key Players:

These are the top 10 players in the cake market:-

1. The Hershey Company

2. Nestle S.A.

3. Mondelez International, Inc.

4. The Kellogg Company

5. General Mills, Inc.

6. Conagra Brands, Inc.

7. Campbell Soup Company

8. Flowers Foods, Inc.

9. Grupo Bimbo S.A.B. de C.V.

10. Hostess Brands, Inc.