Cupcakes in Newsweek

Anyone who doubts the continued importance of cupcakes, and the cupcake industry as an indicator of what's happening in the economy, take note of "The Cupcake Bubble" by Daniel Gross in Newsweek. (Dear media, I would really like to see a cupcake article that does not overemphasize Sex and the City. People may have initially gone to Magnolia because of the show, but that is not solely why they still do, nor what's driving this business.)

With Magnolia Bakery set to open in LA and Grand Central and bakeries expanding, franchising and opening along with cupcake trucks, custom cupcake companies, the growth of companies like Johnny Cupcakes and grassroots, non-profit events like CupcakeCamp and the various Iron Cupcake's, cupcakes are going to be around for a long, long time. Dare I say...forever? That's my two cents, for what it's worth.

In America, bubbles form because any good business idea gets funded a dozen times over. That's the American way. Cupcakes are now showing every sign of going through the bubble cycle. The first-movers get buzz and revenues, gain critical mass, and start to expand rapidly. This inspires less-well-capitalized second- and third-movers, who believe there's room enough for them, and encourages established firms in a related industry to jump in. In New York, the Crumbs is joined by a cupcake truck, Sweet Revenge, Babycakes, and Sugar Sweet Sunshine. The Post notes that in D.C., "established bakers such as CakeLove, Just Cakes, Furin's, Best Buns and Baked & Wired are all in on the act." Operating in what is essentially a commodity market, newcomers try to distinguish themselves by offering twists on the familiar formula. Hello Cupcake, conveniently located near Slate's D.C. office, specializes in organic, seasonal, and local ingredients. Babycakes offers vegan cupcakes. Coming soon to a precious storefront in a gentrifying neighborhood of Brooklyn: sustainable cupcakes made of flour ground from organic wheat raised in Prospect Park, served in wrappers recycled from old copies of the New York Review of Books.

I'm suspicious of the durability of the cupcake boomlet on economic grounds, too. One colleague says the cupcakes are "sort of the baked equivalent of Bush's tax cuts." Why? "Their economic rationale withstands any and all conditions. When the economy is going well, people can afford little extras like cupcakes. When the economy isn't going well, people can afford only cupcakes." Indeed, they are being pitched as affordable luxuries. In an age when discretionary, feel-good spending is at a nadir, cupcake bakeries are trying to persuade people to trade up from cheaper sugar-delivery vehicles (such as, say, a doughnut). It's telling, to me, that the Crumbs that just opened in Westport, Conn., is in the back of a Tiffany's that opened a few years ago. With employment rising and wages under pressure, the larger trend is for consumers to trade down—not up.


Nell's said…
I am a teenage entepunuer and i am into the visual art and the art of baking!! I own a site now and I need customers. People especially adults don't trust teenagera now in our days!! My cupcakes are customizable, which means any one can make the cupcake they desire. I want my business to successed unlike my mothers beauty supply shop. I change my business every year because of school, but this is different! I really would like to keep this site and then make it a domain site. I hope you guys could promote me! Here is my current site
Thank you and have a nice day!