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Kodiak Cakes Disrupts the Sleepy Flapjacks Category with Delicious, Healthy Innovation

Twenty years ago in Utah, the Clark family started selling “Kodiak Cakes Frontier Flapjack and Waffle Mix” to ski town gift shops. While that doesn’t sound particularly disruptive, it signaled the beginning of the wakeup call Kodiak Cakes was about to give to the sleepy flapjacks category, dominated by big, slow-moving brands.

Today, Kodiak Cakes is the #1 selling pancake brand at Target, with the #1 SKU. They are bigger than well-known brands Hungry Jack, Bisquick and Aunt Jemima. The brand also succeeds in Costco and natural grocery retailers.

How Kodiak Cakes Roared to the Top of Flapjacks

Kodiak Cakes Disrupts the Sleepy Flapjacks Category with Delicious, Healthy Innovation

The brand focuses on creating healthy, delicious pancake mixes. For instance, white flour and sugar ingredients are replaced with whole grain and powdered honey alternatives. The brand has chosen whole grains that create a more popular taste profile than simple white flour.  And while mainstream mixes provide 3-5 grams of protein per serving on average, Kodiak’s Frontier Flapjack and Waffle Mix delivers 8 grams of protein, and Kodiak’s Power Cakes product delivers 14 grams.  All Kodiak mixes are Non-GMO, satisfying this growing market demand.

The company feels strongly that continued product innovation is important to growth. Two new flavors will launch this April, expanding Kodiak’s popular protein pancake offerings—Dark Chocolate and Crunchy Peanut Butter.  Protein pancakes is a growing niche, which started with consumers adding protein powder to ordinary pancake mix. Kodiak Cakes’ delivers its protein through grains and dairy without resorting to soy protein sources.

The brand’s product strategy resonates well with Kodiak’s consumer target, which Taylor West, Vice President of Marketing, describes as:

“A mom who wants something better and higher-quality without feeling guilty about her purchases and her meals. We do really well with Boomers who know us from our gift-shop past and are often empty-nester moms. But most of our consumers are Gen X and Millennial moms who are challenging the assumptions of what brands to buy for their family and can appreciate healthier alternatives to cheap, popular brands.”

I expect that dads are also an enthusiastic market for Kodiak Cakes. While an overwhelming 71% of moms agree that “Healthy food/diet” for her child is one of the most important things she can provide, a significant 54% of dads also rank that category as one of the most important. And making pancakes fits in with Dad’s focus on fun experimentation in the kitchen.

To reach the target consumer segment, Kodiak Cakes’ careful channel strategy shows more innovative thinking. West explains:

“We have thought through our approach to accounts and channels very carefully. We are choiceful with the channel and account. For example, we partnered closely with Costco in the club channel and Target in the premium grocery channel.”

Through product and channel innovation, Kodiak Cakes has realized surprising success in a category dominated by big brands. Through its competitive advantages, Kodiak enjoys premium pricing about double that of typical pancake mix. West describes the market opportunity the company saw:

“Flapjacks was a sleepy category. Big companies were finding the easiest way to grow profits, which was by cutting costs rather than raising revenue. They tried to do it in a way invisible to consumers like using cheaper ingredient alternatives like white flour, white sugar, partially hydrogenated fats, and other processed fillers. But as ingredient lists grew longer and longer, consumers were becoming more conscious of both the health and taste benefits of simple, real food. Now that the Big Food brands realize consumer resistance to unpronounceable ingredients and GMOs, they’re trying to catch up to a position that Kodiak Cakes has held all along.”

Those are some emphatic statements coming from a small organization. But no one can argue with Kodiak Cakes’ results. This brand’s story shows how a small company can take on even the largest corporation if it has a compelling market strategy.