CAMDEN, N.J. — At Campbell Soup Co., executives have big plans for the Global Biscuit and Snack business.
In a presentation at the company’s Institutional Investor Day held July 20 in Camden, Luca Mignini, president of Global Biscuits and Snacks, detailed how the division will strengthen its core and expand into faster growing spaces. Specifically, the company plans to increase its brand footprint, as well as reach more consumers more often in more places.
To reach more consumers, Mr. Mignini said it’s all about gaining penetration in new households and recapturing consumers who may have moved away from the company’s products.
|Luca Mignini, president of Global Biscuits and Snacks for Campbell Soup|
“To do so we continuously evaluate evolving consumer preferences and launch new varieties to meet their preferences,” he explained. “And our R.&D. team leverages our baking credential and real food philosophy to deliver the ingredients and eating experience consumers expect from a premium snack.”
It also is important to deliver “more often,” Mr. Mignini said. “More often” is about frequency, he said, and Campbell Soup is striving to create reasons for consumers to crave the company’s snacks even more.
“We drive frequency by developing exciting new product varieties and packages that appeal to the never ending growing snacking behavior and help make our food relevant for new occasions,” he said. “So to do so we are going to go small and big, introducing more single-serve portable packages as well as club or multipack (options).”
Finally, Campbell Soup will continue to look to deliver in more places.
“This is about availability, being in the places our potential consumers shop and about entering faster growing geographies to reach entirely new consumers,” Mr. Mignini said. “To do so we are investing in resources to drive distribution and ramp up our e-commerce capabilities.”
In the United States, Campbell Soup has three priorities for its Global Biscuits and Snacks business: driving growth on Goldfish; improving the performance of the cookie portfolio; and maintaining momentum in fresh bread and rolls.
Building on the health and wellness trend, Campbell Soup through its Pepperidge Farm brand has developed a Goldfish cracker variety for families who prefer to choose organic food. Three varieties of Goldfish made with organic wheat, each in an 8-oz re-sealable bag, hit shelves in late May. Later this year, Mr. Mignini said the company will extend its whole grain line to include a Goldfish colors variety.
Turning to the company’s cookie portfolio, Mr. Mignini said Pepperidge Farm now holds a 5% U.S. market share but believes the company “can do significantly better in fiscal 2017.”
“Milano is the hero of our portfolio,” he said. “So to help us build the success we have seen over the last 15 weeks we are continuing to invest in marketing support and our ‘Keep Something for Yourself’ campaign. We also have some exciting consumer trend driven innovations queued up for fiscal 2017, including spiced cider and toasted marshmallow Milano.”
Mr. Mignini said the company also plans to expand its effort in rolling out Tim Tam nationwide.
“We started more than a year ago regionally and with one retailer,” he said of the Tim Tam roll-out. “During fiscal 2016 we expanded into five retailers nationally and three varieties: original, chewy caramel and dark chocolate. For fiscal 2017 we continue in five retailers and introduced dark chocolate mint as the fourth variety in our U.S. range. And stay tuned for an integrated marketing campaign that introduces more of America to Australia’s favorite biscuit.”
Campbell Soup’s cookie plans also include leveraging Margaret Rudkin’s (Pepperidge Farm founder) passion for quality and Campbell Soup’s “real food” philosophy to reinvent a key piece of the company’s portfolio: the American collection cookie range. The American collection includes the company’s large crispy and soft baked cookies in Pepperidge’s famous white bakery bag with varieties such as Sausalito and Chesapeake.
“This business has been under increasing competitive pressure from small challenger brands,” Mr. Mignini said. “So our bakers are hard at work crafting new recipes that will deliver the taste, smell and bite our consumers want from a snack. We plan to re-launch the range later this year with marketing and sales support.”
On the bakery side of the U.S. business, Mr. Mignini said Pepperidge plans to continue its Western expansion by building on its successful launch of Pepperidge Farm premium brand bread and rolls in the Phoenix market.
“We are currently evaluating additional scale market opportunities in the West coast for our next launch,” he said.
Campbell Soup’s Global Biscuit and Snack division’s second core market is Australia. The company currently has a 60.4% share of the total biscuit category but fiscal 2017 plans call for the company to capture new snacking opportunities by thinking “in and out of the box,” Mr. Mignini said.
“Later this fiscal year, in complement to our existing range of savory biscuits, we plan to launch an exciting new cracker innovation to help make impromptu entertaining a little bit more special,” he said. “We are also looking outside of our box at ways to provide consumers with packaging options that better suit their busy lifestyle and snacking preferences. We plan to implement capacity and capability changes in our supply chain that will enable us to produce single-serve and multipack formats for our popular snacks, like shapes.”
Moving to developing markets in China, Campbell Soup has its eyes on increasing its marketing investment in its targeted area of Shanghai and Guangdong to differentiate the premium nature of the Kelsen brand and recapture households that may have traded away to a competitor product.
“To help extend our reach into key customer outlets across the east and south we plan to bring additional new distributors on board in complement to the new distributors we added in fiscal 2016,” Mr. Mignini said. “We also plan to give our availability an exponential boost later this fiscal year as we ramp up our e-commerce presence. E-commerce in China represents a significant opportunity with nearly half of these 600 million internet users shopping on-line. Our digital team is rolling out plans in the year ahead.”
Mr. Mignini said a strong e-commerce platform would immediately boost its Kelsen brand and may pay dividends in the future with the planned roll-out of Tim Tam and Goldfish.
Campbell Soup plans to add a second manufacturing site in Indonesia in fiscal 2017 and will implement capital investment that is expected to increase the company’s capacity and give it the flexibility to produce single-serve and multipack formats, which are critical to the on-the-go snacking purchases in the general trade across Indonesia.
“This is especially important to our Tim Tam business to help capture incremental growth,” he said.“This is a clear recipe, and we have great ingredients, from iconic brands to global leadership, to propel us in our journey to become a snacking powerhouse with a brand that creates real moments for consumers around the world,” Mr. Mignini said.