CPG Playbook   //   December 21, 2023

Why Levain Bakery’s new holiday products aim to drive gift-giving

New York-based bakery Levain wants people to consider giving away its classic and limited-edition cookies as gifts this holiday season.

For the first time this holiday season, Levain Bakery is selling custom-made felt ornaments in partnership with ornament and gifting brand ​​Craftspring. The company is also offering limited edition cookie tins and is bringing back limited-edition cookie flavors.

As the company tries to branch out beyond its New York City bakery roots, it’s trying to replicate the success it saw in the Big Apple. In New York, the holidays is one of the Levain’s biggest sales seasons. These holiday-themed items would allow the company to bump up sales and transaction sizes in all of its locations. Gifting is also another way for the brand to get more people to trial their brand and potentially acquire new paying customers. 

“We did some consumer insight work and learned that people take real pride in being the person who introduces other people to Levain,” said Lorna Sommerville, chief commercial officer at Levain Bakery.

Levain opened its first shop in NYC back in 1995 and has become a popular destination for baked treats. The bakery has been expanding to new markets in the U.S. with a total of 13 locations across New York, DC, L.A. and Boston. This year, it opened new stores in L.A and Chicago. In the company’s home base of New York, it was common to see people buying their products as Christmas gifts, but in its other markets, this habit hasn’t quite caught on yet.

“There’s still a big spike in demand over the holidays but it’s a little less so [in other markets] than it is in New York City,” Sommerville said. “And I realized it’s just that in New York that association between Levain and the holidays is so well established because we’ve been around for 30 years.”

Now, the company is working to establish a connection between Levain and the holidays in other markets. Sommerville said the company is spending more money decorating stores outside of its core NYC market. For example, in its Washington, D.C. location, Levain decorated the store with a massive 3D bow on the window. 

“We can’t afford to be as subtle there. You really want to be bold and in your face,” Sommerville said. “That’s hopefully going to entice them to come inside the bakeries and check out what’s going on.” 

This holiday, the company is offering 30 SKUs ranging from seasonal items like Dark Chocolate Peppermint cookie, Pumpkin Ginger Spice Cake and Lemon Cake to classics like Chocolate Chip Walnut cookies and Dark Chocolate Chocolate Chip cookies. It is also selling a holiday ornament that looks like a Levain cookie inside its staple blue bag.

So far, shoppers have shown interest in their holiday offering, Sommerville said. Its holiday cookie tins, which cost $15, have already sold out. Somerville did not share specific figures but said revenue, transactions and same store sales are up significantly from the previous year. Last year, Levain revealed that it was seeing a 200% year-over-year increase in online sales.  

The company has also expanded its list of corporate customers that tap Levain to gift products to their employees. Some of its biggest corporate customers include brands like Harry Winston, Tiffany & Co. and L’Oreal. Jewelry brand Harry Winston is Levain’s repeat customer, while L’Oreal is a new customer this year.

Dan McCarthy, assistant professor at Emory University’s Business School, said shoppers are typically less price sensitive around gifts so there is an opportunity for brands to win more share of their wallets when they lean into gift giving occasions. 

“Consumers often put gifts in a different category, whereas they may be more price sensitive for kind of regular ongoing purchases,” he said. “They’d be willing to put that on hold when it comes to gifts for the right people.”

However, he said brands have to be cautious around overinvesting in seasonal products because they could get stuck with unwanted or out of season inventory. “I’m not sure that those are the sorts of items that would sell like hotcakes outside of the holiday season,” he said.

But for Levain, the marketing perks could justify the investment. Sommerville said that the company doesn’t dedicate a huge amount of their expenses on paid marketing. She said the biggest driver for the company’s growth is its bakeries and word of mouth.  

“Once you start to gift Levain, people start to expect it,” Somerville said. “There’s definitely customers who come back to us every year, year after year.”