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Wondering about Wonder Bread? ‘Brand equity is the best thing going for it by a long shot’, says analyst

1 commentBy Kacey Culliney , 18-Jan-2013
Last updated on 18-Jan-2013 at 12:54 GMT

Wonder Bread to be revived? Photo credit: Willoughbydesign
Wonder Bread to be revived? Photo credit: Willoughbydesign

Brand equity is the best thing Wonder Bread has going for it by a long shot and future business strategies should hinge on this, an analyst says.

Last week Flowers Foods emerged as the first ‘stalking-horse’ bidder for assets from bankrupt baker Hostess Brands. The US bakery firm placed a $360m bid for Wonderbread, Nature’s Pride, Merita, Home Pride and Butternut bread brands; 20 bakeries; and around 38 depots. 

A stalking-horse?

Is an initial bid on a bankrupt company’s assets from an interested buyer chosen by the bankrupt company from a pool of bidders that sets the bar so other bidders can’t low-ball the purchase price

Matthew Hudak, research analyst at Euromonitor International, said that should Flowers Foods’ bid go through, Wonder Bread will require the most investment.

“Flowers Foods will need to invest more in turning Wonder Bread around. It really will require more effort – it’s not going to happen overnight,” Hudak told BakeryandSnacks.com.

Wonder Bread sits as a simple packaged bread among fiber enriched, flaxseed artisanal types that really ring well with current consumer sentiment towards health, he explained.

“Strategy moving forward will have to hinge around brand equity, which is the best thing going for it by a long shot,” he said.

The brand should be made culturally significant, positioned as the independent bread of choice, he said, or it could target consumers who used to eat it as a kid.

Talking price points and private label

Hudak said that Wonder Bread, as it is, is not cheap enough to ‘beat off’ private label and not premium enough to battle in the upper bread segment.

He said that the brand could attempt to target private label consumers though – if it was positioned as an affordable, low-end, healthy bread.

“The idea of appealing to private label consumers could be an interesting direction to take it,” he said.

Overseas could work…

The research analyst also flagged international markets as a potential target for the bread brand.

“Wonder Bread has the brand equity of a safe bread to eat – and this safety combined with the convenience of being packaged could appeal to international developing markets,” Hudak said.

“Flowers Foods is a pretty sharp company. They’re in the bread market and know that market. I would think they would have some idea on how to take on the brand,” he said.

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1 comment (Comments are now closed)

If anyone can do it is FLOWERS

Flowers can make Wonder bread brand also what Nature's Own is by making different varieties of it, more healthier varieties and would say they are already doing that now and redesigning the packaging for it and they already have the best recipes for it, Nature's Own is the number one selling loaf of bread in the USA and Flowers only serves 70% of the population now but this bid if won should open the whole USA to Flowers and they will give Bimbo a run for their money then and I would say within a few years time a new number bread in the USA will be an American Company. Flowers is the best managed company probably in the USA and they may go worldwide with some partners in other countries.

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Posted by Cullen A Williams
01 February 2013 | 21h34

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