ORRVILLE, OHIO — Two-thirds of brands in The J.M. Smucker Co.’s portfolio are holding or gaining market share. Mark T. Smucker, chief executive officer of the Orville, Ohio-based company, attributed the brand strength to three factors beyond pandemic-related impacts in a Sept. 9 fireside chat at the virtual Barclays Global Consumer Staples Conference.
“I think it's execution on supply chain, sales and marketing,” he said. “A lot of it has to do with making sure our teams have the ability to focus on things like managing every link in the supply chain, ensuring that we can get our ingredients, make the product and ship it. Because we've been so laser focused on that and working with our suppliers and retail partners, it has allowed us to very effectively manage our supply chain and truly continue to deliver products to shelf.”
Smucker also is focused on sales execution. The company in 2021 deployed a new sales model that separates sales teams between people and pet food. A third factor is marketing, which has benefited from a more balanced approach to mass reach and target consumer reach, Mr. Smucker said.
With the company raising its fiscal 2022 organic sales growth outlook from 2% to 2.5%, and sales trends remaining elevated in August, management expects many of the new households that have come to its brands in the past year will be sticky moving forward, even as reopening occurs.
“Even as this pandemic continues or hopefully ends, one thing is certain, which is consumer habits have changed,” Mr. Smucker said. “One very notable place is that people will work from home more than they used to. Clearly, the opportunity there for us is that many of our food and beverage products obviously are at the breakfast and lunch occasions. “
Another tailwind is the number of coffee brewers that have been acquired during the pandemic.
“Over 75% of cups of coffee consumed are consumed at home,” Mr. Smucker said. “We stand to benefit there.”
Key to winning in the coffee category is playing in multiple segments.
“What that means in coffee is ensuring that we’re in the single-serve space as well as the premium space, both with Dunkin’ and Café Bustelo,” Mr. Smucker said.
The Folgers brand also has a role to play in balancing new and emerging brands, he added. It is an anchor brand for the company that has continued to gain share over the past several quarters.
“Folgers, we know, is going to be a stable, flat to very modest growth brand that contributes a lot of cash and helps support our entire business,” Mr. Smucker said. “We do have plans to continue to contemporize the brand and ensure that we're not alienating our core consumers, but we're also speaking to new trends in the category. So that may include things like packaging and some new breakthrough advertising.”
Coffee is one category that could be bolstered by future acquisitions, he said. Opportunities also exist to acquire brands that check the same boxes as the Uncrustables brand, which has long been a bright spot in Smucker’s portfolio. The handheld sandwiches have seen 29 consecutive quarters of growth.
“We think about snacking as portable, no mess, ready-to-eat meal solutions,” Mr. Smucker said. “Those are the key characteristics of Uncrustables. Things that might fit into the snacking portfolio, whether they’re frozen or not, would be something of interest.”