business news in context, analysis with attitude

by Kate McMahon

"Kate's Take" is brought to you by Wholesome Sweeteners, Making The World a Sweeter Place.

This is a story about dough, as in pastry and in currency. And about constant innovation.

The newest culinary craze in New York is the cronut, a highly-coveted confection created by the Dominique Ansel bakery. The Soho chef’s trademarked cronut is a flaky croissant-doughnut combo filled with flavored cream, deep-fried in grapeseed oil and glazed to perfection.

Since its debut in May, the $5 cronut has created a foodie frenzy – pre-dawn lines, celebrity fans, TV and social media buzz, a host of imitators and even a “black market” in which scalpers will purchase and hand-deliver a cronut for a whopping $100 each. Or 20 for $3,000, all inclusive.

But underneath the multiple layers of pastry and rose-vanilla glaze there are telling business lessons about creativity and quality.

Ansel, an award-winning French pastry chef who brainstorms new ideas with his staff every week, spent two months perfecting the cronut recipe. One mention of the cronut’s debut on the Grub Street blog led to 140,000 hits and it literally became an overnight sensation.

Ansel increased production from 30 to 50 per day, which sold out in 15 minutes. He has since ramped up to 350 per day, limited the number to two per customer in an attempt to stave off scalpers, and has no intention of increasing production or franchising. “This is a bakery. It is not a cronut store,” Ansel said. He is also known for treating customers who are queued-up at 5 a.m. for the 8 a.m. opening to hot coffee and freshly-baked madeleines.

But not all is sweet. Ansel moved quickly to trademark the name cronut, and on the bakery’s Facebook page he defended that decision against “bullying” and “malicious attacks” by competitors. Naturally, other bakers, restaurants and grocery stores would want to crank out their own version of the cronut. Ansel compared his trademark name to McDonald’s Big Mac and Burger King’s Whopper, and noted neither is preventing the other from flipping a hamburger.

Knock-offs feature names ranging from doissant, dossant, frissant, cronot to crullant. A headline on the blog Eater blared “Here Are Nine Cronut Impostors From Around The World.”

In Norwalk, Connecticut, for example, Stew Leonard’s capitalized on the trend with its new product, the Cro-Do. On a recent Saturday, a bakery rep was slicing warm Cro-Dos for customers and explaining what set Stew’s product apart from Ansel’s -- no cream filling or frosting. Naturally, I tasted and picked up a box of two for $5, much more than I normally pay for 6 ounces of baked goods. (The price is now down to $3.99.) Minimal expenditure for a store with a bakery, maximum marketing opportunity.

While the cronut craze and the 5 a.m. lines will surely ebb, Ansel’s commitment to innovation and quality have not. He is featuring a monthly flavor for the cronut – blackberry for July, coconut for August chosen by Facebook fans – but more importantly has moved on and is marketing his new summer fave, the Frozen S’more.

It features a custard ice cream center that’s covered with crispy chocolate wafer chips, surrounded by a soft marshmallow mixture and frozen in a square mold. It is then blow-torched to order on a smoked wooden stick for a crème-brulee like crust.

Best of all? “This can not be scalped,” Ansel said with a smile. “You have to eat it here.” And it’s already being billed as the Fro-Smo.

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