BOCA RATON, FLA. — Campbell Soup Co.’s strategy to expand in higher-growth spaces rests on four bold moves. Together, these dynamic platforms are expected to deliver more than $1 billion in incremental net sales growth.
Denise Morrison, president and chief executive officer of the Camden, N.J.-based company, discussed the four-part framework during a Feb. 19 presentation at the Consumer Analyst Group of New York conference in Boca Raton.
“Our first bold move is the expansion of our category platforms through breakthrough innovation,” Ms. Morrison said. “It is clear that we must continue to fuel our innovation pipeline to invigorate the growth in our business, with an emphasis on developing disruptive innovation that will delight consumers.”
Campbell’s new dinner sauce platform demonstrates that effort. On the success of Skillet Sauces and Slow Cooker Sauces lines, the company this summer is launching Campbell’s Oven Sauces.
“This terrific new product will enable consumers to prepare easy, modern oven-baked dishes in great-tasting varieties,” Ms. Morrison said. “Like the other products in this platform, our Oven Sauces will come in convenient pouches. They are designed to create delicious meals with five minutes of prep time, three ingredients or less, and 35 minutes of bake time.”
Also in the pipeline is a new premium soup platform, targeting the $750 million retail segment of the soup category that is growing 12% each year, Ms. Morrison said. Campbell is extending its lineup of premium soups, which includes Slow Kettle, Gourmet Bisques and Go! lines, to attract both younger consumers and more affluent shoppers with provocative flavor profiles and eye-catching packaging.
“(The premium soups segment) is still small relative to the mainstream, but it is growing faster,” Ms. Morrison said. “And we do think that the way we have studied younger consumers, it’s important to have offerings outside of the can, it’s important to have offerings with much more interesting restaurant-style taste profiles, and it’s really important to start to deliver on the fresh component.”
The second bold move in Campbell’s playbook is expanding availability of products to consumers where and when they want them. An example is ready-to-drink single-serve beverages, a category that currently accounts for a small percentage of the company’s sales. Two recent events have positioned Campbell to expand in the category: new distribution for V8 brand single-serve products, and the acquisition of Bolthouse Farms.
“We will continue to expand the distribution of Bolthouse Farms premium beverages,” Ms. Morrison said. “Consumers will now be able to buy them in places where they haven’t seen them before: in convenience stores and drugstores, in schools and in many other venues where we can now have a larger presence for our healthy beverages.”
Campbell’s third bold move is further expansion into the $12 billion packaged fresh category.
“Our move into this fast-growing space is enabled by the combination of our existing expertise and new capabilities that we have gained with our acquisition of Bolthouse, a business with great agility and a robust innovation pipeline,” Ms. Morrison said.
In March, the company will introduce new Bolthouse Farms salad dressings, smoothies and juices, and a new carrot product designed to tap into the trend of in-home juicing.
Fourth, Campbell is targeting faster-growing markets, particularly Asia and Latin America. Last year’s acquisition of the Kelsen Group has expanded Campbell’s presence in China and Hong Kong, which generates almost 40% of the Danish snack maker’s sales.
“Over the long term, we will be looking at expanding some of our other key brands in these important markets,” Ms. Morrison said.
A “seismic social change” has rocked the food and beverage industry, she said. Changing demographics and family dynamics, explosive growth in packaged fresh food and e-commerce, and emerging channels, such as clubs and dollar stores, have transformed the consumer landscape.“These factors are affecting all food companies,” Ms. Morrison said. “In our industry today, the earth is moving under our feet, and it is not easy today for any company to keep its balance and sense of direction. But those that understand and embrace change can succeed. At Campbell, we are keeping our balance.”