Campbell Soup Co. has learned the road to wellness can be a bumpy one.
Earlier this month, the company released fourth-quarter results which were impacted by issues within its Campbell Fresh unit, including a drought that hurt crops and a decision by the company to harvest carrots too early. Campbell's sales fell 1% in fiscal 2016 and it expects sales to be flat to up just 1% in fiscal 2016, which began in August. "The performance of our Campbell Fresh business, driven predominantly by execution issues, is disappointing," CEO Denise Morrison said in a statement. But she added that the company isn't deterred on its freshness path: "We have taken and are taking steps designed to ensure the business performs to its potential."
Wellness has been a hallmark of Ms. Morrison's tenure, during which Campbell acquired brands such as Bolthouse Farms and Plum Organics. During speeches, the CEO often refers to her company's purpose as "real food that matters for life's moments."
So Campbell is pushing ahead, introducing a new soup line called Well Yes that will earn a 100% score on the company's recently introduced real food index. On the index, products without things such as artificial colors, flavors and preservatives, high fructose corn syrup and MSG score higher.
The new soup is not refrigerated to ensure freshness. Nor does it come in a clear, reusable container, the better to see the real food. Well Yes, making its debut in January, will be a canned line featuring ingredients including kale and quinoa.
"There's really nothing like it on the market today," Ms. Morrison said in July.
The idea for Well Yes came from a group of women who work at the company who "felt the category lacked a product specifically for them: a brand that stood for something they could connect with and one that used ingredients they wanted more of like kale, quinoa and lean protein," Mark Alexander, president, Americas Simple Meals and Beverages division, said at Campbell's July meeting. He described the flavors as "popular soup recipes with a decidedly contemporary twist."
Plans include varieties such as Italian vegetables with farro. Images shown at the meeting included bright green labels featuring fresh foods such as tomatoes and carrots.
Of course, Campbell already has competition in the soup aisle when it comes to "cleaner" fare. General Mills, maker of Progresso soups, bought the Annie's Homegrown company to help with its own better-for-you expansion. It now sells Annie's brand soups with kid-friendly flavors such as organic creamy tomato and bunny-shaped pasta. Well Yes soup will also compete against other simple meal options, such as salads or sandwiches.
"The category has been challenged, and so I think the way you get consumers more interested in the category and shopping that particular aisle is by bringing innovation and new news," said Morningstar industry analyst Erin Lash. "Maybe this is an opportunity to do so, especially with the health and wellness bent to it."
Campbell has such confidence in the idea that it sped up plans to introduce the product six months early, giving it a January launch rather than holding off until the next fiscal year. January is months into the fall-to-winter soup season. Still, there are "really good" opportunities for merchandising at the launch, given the market's focus on New Year's resolutions and wellness in January, Ms. Morrison said. BBDO is the agency handling the product introduction. BBDO also works on its main soup line, while Y&R New York handles Cambpell's Chunky.
"They've tried to move into some of the premium and more organic, better-for-you-type soups in the past with mixed results," Ms. Lash said.
Still, to Ms. Morrison and others, real food is not just about health. After all, Campbell still sells a lot of Pepperidge Farm cookies.