MIAMI — The Rao’s brand, with revenue of $775 million in 2023, made up a large chunk of the Campbell Soup Co.’s acquisition of Sovos Brands, Inc. valued at about $2.7 billion.
Camden-based Campbell Soup has ideas on how to accelerate Rao’s path to becoming a $1 billion brand, said Mark A. Clouse, president and chief executive officer, March 12 at the Bank of America Consumer and Retail Conference in Miami.
“I think what is so impactful or powerful about the more recent trends on Rao’s is that you see (the brand) growing on both fronts,” Clouse said. “So you see distribution runway still being an opportunity, and you still see household penetration, which manifests as velocity increases, among other things.”
Campbell Soup may increase Rao’s presence in Canada.
“By the way, it doesn’t really go north of the border yet,” Clouse said, adding premium items in certain categories often integrate well into Canada.
“So there’s a great opportunity there, geography as well,” he said. “We’ve got a super footprint there, a really good team in Canada. So there’s a variety of options that we’ve got, I think, for continued expansion.”
Clouse expressed caution on the idea of combining Rao’s and its sauces and Campbell’s Prego brand in some way.
“My experience has been that you kind of can’t help but migrate to the shiny new object, and the unintended consequence of that can be a little bit of a distraction on the base business,” he said.
The noosa yogurt brand also came with the Sovos acquisition.
“I continue to feel like as much as I like the product, I’m not sure yogurt long term is a core category for us, but what I will say is that the confidence that I have in the business affords us optionality and the ability to be patient and make sure that we find the right answer to that question,” Clouse said. “So for all intents and purposes for now, it’s business as usual.”