The CMO Interview

Where Heinz Found the Money to Invest More in Marketing in '09

CMO Brian Hansberry on Pulling Once-Sleepy Brands Back Into the Mix

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CHICAGO (AdAge.com) -- Comfort food never goes out of style, but it's a particularly good time to be helping consumers make their own. With more mothers looking to cook at home for their families, attempting to recreate the restaurant-style experience they can no longer afford, marketers that understand that dilemma, such as Heinz -- purveyor of ketchup, Ore-Ida potatoes, Classico pasta sauces and Smart Ones frozen meals -- are sitting pretty indeed.

Heinz CMO Brian Hansberry
Heinz CMO Brian Hansberry
Brian Hansberry, a nine-year Heinz veteran, is a CMO who also runs the $1 billion comfort-food business for a brand that, according to TNS Media Intelligence, spent $70 million in measured media during 2008. Mr. Hansberry, 43, cut his teeth at Procter & Gamble, working for 10 years on brands including Duncan Hines, Folgers, Jif and Sunny Delight. At the time of the interview, he reports directly to and works closely with then Heinz-North American CEO David Moran.

Heinz has met or exceeded earnings expectations for each of the past six years, something Mr. Hansberry attributes in part to the composition and structure of the 95-person team he built nearly from the ground up upon arrival. He sought marketers who are also skilled business managers, as each brand manager has responsibility for the brand's profit and loss and ownership of pricing decisions.

Tough economic conditions have created an opportunity for the food business, Mr. Hansberry said. "People look to food for comfort, security, escape and high-quality time with your family, and a number of our categories are taking off: pasta sauce, gravy, potatoes. We play right in the sweet spot."

Indeed, with an average household income of $49,000, most moms spend $5,700 a year on food, or $100 a week, Mr. Hansberry said. That's $15 a day and, at three meals a day, $5 per meal to feed a family of four. That's been a boon to brands such as Ore-Ida and Classico, but Mr. Hansberry said it's a challenge for "me categories" such as Smart Ones, which is geared toward single portions and can cost about $3 per serving.

Another big change in the marketing landscape since his arrival has been the ability to test new products via social networks. Mr. Hansberry said consumer insights have pulled once-sleepy brands back into the mix. For quicker-to-market strategies, Mr. Hansberry looks to online communities to deliver rapid feedback on new-product tests. Ore-Ida launched a Steam n' Mash frozen-potato product last year, and he said the redskin-potato selection was the result of consumer requests.

In an interview with Advertising Age, Mr. Hansberry talked about understanding moms, the relevance of comfort foods and how Heinz is waking up the ketchup business in the midst of a recession.

Ad Age: How important is sustained marketing support right now?

Mr. Hansberry: One of the things we can do to navigate this recession is to increase marketing support. We have data to back us up. Nielsen conducted a study [that showed] businesses investing in increased marketing during recessionary times emerge from recession dramatically faster than businesses where marketing [was flat or declined], and we have support right on up to [then-North American] CEO Dave Moran.

Ad Age: How are you funding these increases?

Mr. Hansberry: We're attacking costs because Mom, in these recessionary times, is not willing to pay for everything anymore. We've identified what she's willing to pay for and what she's not willing to pay for. For example, the corrugated packaging we ship our ketchup in is not something [she] values, so we found the least expensive way possible so that we can drop those costs and fuel marketing budget and fuel our brands. The one thing we won't sacrifice is what comes in the packages, and that's the taste, hence our emphasis on taste.

Ad Age: Mom?

Mr. Hansberry: My background is 10 years at P&G and nine years here. I was trained in [the concept of] the consumer is our boss. I very much believe that. We use the word "she" to connote the consumer is our boss. Anybody can be doing the shopping, but we speak in terms of she.

Ad Age: You redesigned the Heinz ketchup label last year, adding a picture of a tomato. How has that been received?

Mr. Hansberry: Heinz is in every household. In America it has higher household penetration than salt and pepper. It's an amazing thing, one of the strongest brands within consumer package goods. It's a blessing and a curse when you have a business that everybody had tried and has in their home, and when you're in charge of growing that, it can be quite challenging. Our biggest opportunity was to grow usage occasions and [get consumers to] consider using Heinz ketchup more than they do.

Ad Age: But moms needed to know there were tomatoes in the ketchup?

Mr. Hansberry: That's the single kernel behind "grown not made," to remind mom that when she buys Heinz, it's a product we have essentially cared for from seed to plate. Every bottle of ketchup starts with the tomato.

Ad Age: There's a piece of insight that'll blow your mind.

Mr. Hansberry: That was the thing we took for granted, that she knew it came from the tomato. Not all people spend as much time thinking about ketchup as we do.

Ad Age: And you've also innovated in ketchup since arriving nine years ago. How did you do that?

Mr. Hansberry: If you look back over last six years, you see a track record of innovation. We took a relatively sleepy category and we've been innovating like crazy with kids' colors, upside-down bottles, fridge-fit bottles -- we have been able to grow the category and market share. There's no such thing as tired brands, but tired brand managers. We have certainly worked up these brands.

Ad Age: But what drove those changes?

Mr. Hansberry: We believe here innovation begins with an eye; it's about observation. It's an amazing insight that ketchup was kept around for so long that consumers stored it upside down, and we didn't know that until we saw it with our eyes.

Ad Age: How are you looking at private label these days?

Mr. Hansberry: In recessionary times, the No. 1 competition is private label. The single biggest thing we can do is to deliver value proposition, product benefit -- particularly the taste we provide -- and communicate that message to consumers. Private label has been growing, so it's critical to be No. 1 or 2 or your distribution is going to the threatened. Our responsibility as a branded leader is to innovate and grow the category for our trade customers, so we play a leadership role. In doing so, we throw private label off their game.

Ad Age: You've also developed online communities to assist in product development and marketing. How did that work with the Steam n' Mash mashed-potato launch?

Mr. Hansberry: We were able to place the product with the moms [through the Let's Dish and She Speaks] communities. They were able to taste it, test it, record different things for us. They looked at packaging, choices on flavors; they really influenced the flavors that launched. In the offline world, if we did a traditional test-market launch, it takes nine to 12 months to read [the results] and would take about another nine to 12 months to roll out. But by leveraging communities, from ideas to execution, the first presentation from a summer intern to national launch was nine months.

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