Campbell Soup shifting focus to snacks
Campbell Soup Company is repositioning itself to drive long-term, sustainable sales and earnings growth.
The company gave an update on its strategy and progress on its transformation ahead of its presentation at the Consumer Analyst Group of New York (CAGNY) Conference in Boca Raton, Fla.
Since 2011, the company says it has repositioned itself to drive long-term, sustainable sales and earnings growth by:
- Leveraging strategic foresights to identify long-term growth platforms in the areas of future commerce, personalized nutrition and deliberate snacking;
- Transforming Campbell through external development, acquiring new businesses to expand in the faster-growing spaces of health and well-being and snacking;
- Implementing a successful cost savings program that has delivered $365 million in savings to date while investing a portion of these savings back in the business;
- Improving its cost structure and increasing supply chain productivity;
- Pursuing new models of innovation and dynamic partnerships to define the future of food, including forming a venture capital fund to invest in early stage companies at the intersection of food, health and technology; and,
- Accelerating digital marketing and e-commerce efforts by building an e-commerce unit in North America.
The company recently completed the acquisition of Pacific Foods and has a pending Snyder’s-Lance, Inc. acquisition, which will be the largest in Campbell’s history. With the completion of the Snyder’s-Lance acquisition, Campbell will shift its portfolio toward faster-growing categories, with snacking representing approximately 46% of the company’s annual net sales.
"Since 2011, we have been taking steps to transform our portfolio in response to the seismic shifts that are driving monumental change across the food industry," said CEO Denise Morrison. "Guided by our purpose, ‘real food that matters for life’s moments,’ Campbell has undergone a remarkable transformation, evolving from a company that had been largely reliant on soup to a more diversified and dynamic company that anticipates changing consumer behaviors and adapts to the new consumer marketplace."
Campbell recently raised its cost savings target from $450 million to $500 million, which it expects to achieve by the end of fiscal 2020.
The company says soup sales fell 7% last quarter in the United States compared with last year.
Morrison blamed a "key customer issue" — code for an ongoing dispute with Walmart. The Wall Street Journal reported in August that the two couldn't agree on pricing and shelf space promotion. Morrison said Friday that Campbell was "making progress" on an agreement.
The Campbell’s portfolio includes Pepperidge Farm, Bolthouse Farms, Arnott’s, V8, Swanson, Pace, Prego, Plum, Royal Dansk, Kjeldsens, Garden Fresh Gourmet and Pacific Foods.