Keeping pace with the millennials
Providing flavor solutions that meet the needs of an evolving consumer base will be key to McCormick meeting its sales goal. Across the general population, the demand for flavor has grown 10 points since 2007, and that is accelerating among millennials, said Brendan F. Foley, president of McCormick’s global consumer business and North America.
|Brendan Foley, president of McCormick’s global consumer business and North America|
“Going just a little deeper on millennials,” he said. “Our business is particularly well suited to meet their demands in other ways. With 64% saying they love to cook, millennials have a great desire to make ordinary dishes extraordinary or epic, as they might call it. In this context, spice blends are considered superheroes within the kitchen, especially to new cooks. They also have a strong interest in global cuisine, with 32% preparing ethnic dishes for dinner. Our brands like Thai Kitchen, Zatarain’s, Simply Asia and Lawry’s make this very approachable.
“Our category indexes well with this generation, and studies of brand attitude, household penetration and share of purchases are all positive and on par with other generations. McCormick is already well aligned as millennials make up one-third of mccormick.com traffic. McCormick also has a leading share with this generation, and 80% of them view McCormick spices as the best or one of them.”
A major initiative under way at the company involves renovating its core products with an eye toward anticipating consumer demands and being transparent.
“ … By the end of the fourth quarter, 73% of our gourmet units sold were organic and we expanded shelf space with 4 of our top 10 retailers,” Mr. Foley said. “This initiative also enabled us to win new distribution to come in 2017.
“Our latest renovation includes all-natural extracts, which were converted from imitation; and all-natural food color. We’re also excited to announce the launch of BPA-free packaging for McCormick Black Pepper and Old Bay and have a companywide goal for all of our packaging to be BPA-free by the end of 2017.”
Innovation to be introduced during 2017 includes “mini” and “super deal” package sizes. New McCormick Organic Minis will be a smaller package that reduces the barrier for consumer to try, Mr. Foley said. He added that McCormick is in the process of test marketing smaller sachets of individual herbs and spices that include recipe instructions for such specifically flavored meals.
“For those heavy users, we are launching a new super deal format that offers better value and includes 21 s.k.u.s (stock-keeping units) and five new flavors,” he said.
|||READ MORE: Three future platforms of innovation|||
Three future platforms of innovation
With an eye toward meeting its fiscal 2019 sales target, the McCormick & Co.’s management team has identified three innovation platforms it plans to grow. One such platform focuses on the breakfast occasion.
“Consumers are looking for products that can enhance their oatmeal, yogurt, eggs, weekend pancakes and even smoothies,” Mr. Foley said. “With this in mind, we developed a range of four product lines: breakfast toppers, breakfast seasonings, slow-cooker breakfast and smoothie boosts. Whether it’s your morning oatmeal, yogurt or even planning a weekend brunch, McCormick Good Morning allows you to flavor your favorites with real ingredients and fewer calories. All of them are clean label and most will be gluten-free.”
The breakfast line is slated to launch later this year and feature 18 items.
McCormick’s second innovation platform will focus on freshness. The fresh platform will utilize technologies that came to McCormick from its acquisition of Gourmet Garden, a company based in Australia that manufactures and sells chilled packaged herbs.
“As evidence of consumer demand for fresh ingredients, retail sales of Gourmet Garden grew 27% in the U.S. last year, and household penetration increased to 110 basis points,” Mr. Foley said. “This business greatly advanced our closer to fresh innovation with patented technology and knowledge of fresher ways to deliver herbs.
“We now have a lightly dried technology that keeps herbs fresh and protects against wilting without any additives or artificial preservatives. Consumers, especially millennials, really spark to this product promise. We plan to further expand the application of this technology and innovation as it is an important platform for us in the perimeter and center-of-store.”
For the company’s third innovation platform, managers with the company plan to capitalize on the consumer’s use of spices and herbs to reduce the amount of sodium and sugar in their diet.“ … We recently commissioned a global study across our top seven markets to better understand health and wellness as it relates to our spice and herb business, along with interesting innovation space and potential acquisitions,” Mr. Foley said. “The research is already revealing interesting insights about the health-centric consumers. This includes an affinity for cooking from scratch and using spices and seasonings to eat more healthy foods. It’s notable that this group consumes 40% more herbs and spices per capita than the general population. With the insights coming from our proprietary research, we are planning an even more robust innovation pipeline for the next several years.”