Skip to main content

The Cupcake Economy

Jacob Goldstein has a great post over at Planet Money about the cupcake economy. He predicts it’s a bubble that will soon pop.

(from Flickr user chotda)

I agree with Goldstein that it’s hard to see how the market for gourmet cupcakes will be able to sustain itself in the long-term. Now, I don’t agree that it’s necessarily a fad and one day people are going to simply quit buying cupcakes. Instead, I imagine what will happen to gourmet cupcake shops along the lines of what happened to Starbucks.

The cupcake market will continue bobbing along until the next recession hits, when people will look at their budgets and realize that they’re spending an absurd amount of money on cupcakes. People will step back, examine the situation and say, why am I paying five-dollars for a single cupcake when I could make two-dozen of them at home for the same money?

Part of the market will shift to homemade cupcakes, part of the market will shift to fast-food restaurants. McDonalds and Dunkin Donuts may eventually jump on the cupcake bandwagon. That will be the confirmation that the cupcake ship has sailed.


Angie said…
But cupcakes will always be delicious.

Ummm cupcakes ...

Popular posts from this blog

In Praise of Southwest's 'C' Boarding Group

A few weeks ago I saw a tweet from someone complaining that their Southwest Airlines boarding pass had been assigned A20 (meaning they would be at least one of the first twenty passengers to board the plane). Apparently this person though they should have been assigned a higher number, less their flight experience be considerably spoiled.

Despite the complaints, Southwest has resisted demands to assign seats on its flights, a decision which I personally applaud. I'll admit that I was skeptical when they rolled out the newest boarding procedure, assigning both boarding groups and a line number; but in hindsight it seems like one of the best operational decisions they've ever made. If nothing else, it effectively eliminated the infamous "cattle call" whereby fliers were getting to airports hours in advance and sitting in line on the floor as if they were waiting for the midnight showing of the new Star Wars movie.

When I was an intern at Southwest Airlines last winter, I…

So You Want to be a Southwest Airlines Intern?

My personal website must have pretty decent SEO - because in the past year, I've received about two dozen emails from aspiring Southwest Airlines interns looking to draw on my experience in search of their own dream internship. In the past two weeks alone a few new emails have already started rolling in...

(from flickr user San Diego Shooter)

If you've found your way here, you might be hoping for the silver bullet; a secret tip that will propel you above the competition. Unfortunately, I do not know any inside secrets. I can only share my experience as an internship candidate about two years ago and, rather than responding individually to future emails I anticipate to receive, I hope that potential interns will find the information posted here valuable.

Understand: Southwest Airlines is a very unique company. The corporate culture at Southwest is truly unlike that of nearly every other company. But you probably already knew that, since it now seems mandatory for every management,…

Mixing Sports and Business

In the last two days I've devoured every article in the Washington Post about the Nationals painful and epic defeat on Friday night in the NLDS. It was a tough way to see the season end, there's no doubt about that.

(from wallyg on Flickr)
These articles make it clear that there are a lot of people emotionally invested in professional sports. I think they sometimes they forget that, ultimately, Major League Baseball is big business. Each team is a major corporation and the league itself is an organization governed by a bunch of executives. The television networks that show the games are under contract with the team owners and the games aren't usually available to those without cable.

This is why it can be so hard to be a fan in this game. It's the multi-millionaire and billionaire owners that call most of the shots. They get to decide how much they're willing to spend on players. They get to decide who to hire as the CEO of the company. They get to decide how much t…