Campbell Eyes 200 New Products From Soup to Sauce
Many of the new items are launching in categories outside of the marketer's core soup business, as Campbell continues to follow consumers who are demanding more fresh foods. For instance, the company plans to pour more marketing behind its Bolthouse Farms division, the fresh carrot, salad dressing and beverage marketer it acquired one year ago.
Campbell is also relying on Bolthouse's expertise to launch V8 Harvest, the brand's first entry into what its's calling the $12 billion "packaged fresh" category. The 100% fresh tomato vegetable juice will be sold in the refrigerated section -- rather than V8's traditional center-of-store placement – in a move to appeal to the shopping habits of millennials. At the same time, Campbell also has high hopes for Plum Organics, a leading organic baby food brand that it acquired in June.
In a meeting with Wall Street analysts on Wednesday, Ms. Morrison said the company will not abandon the baby boomers that have long driven the company's soup sales. But she said that "even as we continue to honor our roots and heritage at Campbell, we must also connect with new generations and different populations in our country and around the world." Ms. Morrison described the new marketplace as a "digitally connected global culture of food" compose of Hispanics, millennials and emerging-market consumers who prefer bolder flavors and sophisticated cuisines.
The ad reductions have not hurt the soup business, which is rebounding after a long-running slump. U.S. soup sales grew by 5% in the U.S. in the first nine months of the fiscal year. (Executives noted that the colder winter played a role in the rebound.) "We are not doing any victory dances yet but … but you can feel the momentum," said Mark Alexander, president of Campbell North America.As it shifts priorities, Campbell has also adjusted its advertising budget. Though digital marketing spending has jumped by 40% this year, the company expects overall advertising and promotional spending will decline by about 12% for fiscal 2013, which runs through the end of July, led by reductions in soup advertising. When quizzed by an analyst about the soup ad cuts, Ms. Morrison replied that the company has not "always been the most effective and efficient in our spending. We quite frankly wasted a lot of money."
The newest offering is Campbell Homestyle soups, which will be marketed as having no added preservatives and a "taste that takes you home." The premium lineup will replace the white-canned "100% Natural" lineup, which the company said failed to live up to taste expectations. Chunky has emerged as a star performer with sales up 10% this year. Executives credited the brand's NFL-themed advertising that in the coming months will star the Green Bay Packers' Clay Matthews as the next "Mama's Boy."
Other new products include a line of Swanson flavor-infused broths such as Mexican Tortilla and Thai Ginger. The company is also launching Campbell Slow Cooker Sauces in flavors such as Apple Bourbon Barbeque that are meant to appeal to the more than 80% of the U.S. households that own slow cookers. Marketing will include a partnership with the Crock-Pot brand of slow cookers.
Goldfish innovations seek to move the kid-targeted brand into new occasions and consumer markets. Goldfish Puffs, which put the smiling fish in cheesy air-puffed baked form, will target teens. While teens have an affinity for the brand, "they tell us moms have stopped buying the product for them as she assumed that they had grown out of the traditional cracker," said Irene Chang Britt, senior VP-global baking and snacking. So the idea is to lure them with back with bold flavors like buffalo wing and cheddar bacon.
The Puffs launch follows the recent debut of Goldfish-branded Mac & Cheese, which began appearing exclusively at Walmart stores last month in a move to bring the brand into meal occasions. "We plan to roll out beyond Walmart over the next year based upon our ability to supply customers and their planning windows," a spokeswoman said.