Mind Your Ps
At the 2021 NACS show last week, KIND formally introduced a new line of dipped clusters. For months now, the brand has been showing/testing versions of these nut-centric snacks on-line and in select regions. The clusters contain nuts, seeds and, in one version, dried fruit. Each version contains 4g of plant protein. Varieties include: Dark Chocolate Nuts & Berries, Dark Chocolate Almond Butter, and Dark Chocolate Vanilla Cashew.
Old El Paso has launched new Taki-flavored shells. The hard-shell corn taco shells based on the popular snack chips are available in two varieties: Fuego-inspired Hot Chili Pepper and Lime-Flavored Stand 'n Stuff Taco Shells. The launch is a Walmart exclusive.
Skinny Dipped, the brand that began by lightly coating nuts with dark chocolate, has launched Skinny Dipped Baking Bits. The new product is available in two varieties, Dark Chocolate Sea Salt and Semi-Sweet Chocolate, with 67% and 63% less sugar, respectively. Both products are available in two packaging formats, the ‘traditional’ lay-flat pillow pack and a stand-up, resealable pouch.
Miyoko’s Creamery has launched a new form of cheese, Liquid Vegan Pizza Mozzarella. The product, which had limited launch in foodservice last year, will be expanding its foodservice use with a retail launch coming soon. According to the company, the new product is made through fermentation using organic cultured cashew milk, resulting in a liquid that, when baked, creates a melting, bubbly and browned look like dairy mozzarella. By going right to a liquid form and bypassing the block of cheese, the company claims they reduce the greenhouse gas emissions by 98% compared to animal-based cheese.
So What? Over the years, I’ve run thousands of ideations for everything from breakfast cereal, to pet shampoo to e-commerce services, and they almost all end in the same way. Participants are faced with a real or virtual wall of ideas and asked to vote for their favorites. And, even when this voting is prefaced with brand, technology and business criteria, people invariably vote based on novelty. Cool and unusual always rise to the top.
This isn’t necessarily a bad thing. If you are in a category where you need novelty to breakthrough, where basic needs are met and ‘different’ provides you with an advantage, go with novelty. However, if you choose radical ideas because YOU have been on the desk for 3 years and are bored with incremental innovation, that might be a problem. If your consumer is content with new flavors and you are offering radical new mashups and forms just because you’re bored, you might lose volume and momentum in the category.
This is where I usually break out the 4Ps of Innovation. Not the standard 4Ps of Marketing, although they are related, but an innovation specific framework to help ground teams, to better understand how incremental or radical their ideas should be.
How do I read this?
Incremental: More of what you currently do; Radical: Something totally new to you
Product: Changes in the form, flavor and make-up of the service
Position: Changes to the target or the story
Process: Improving or changing how the product is used or delivered
Paradigm: Redefining how you frame the offering
How to use this?
First, look at your current category and plot products on the framework. Pay special attention to both category captains as well as those items that recently failed. How many Ps are they pushing and how far are they pushing them? This gives you a pulse on the innovation potential of the category. In my experience, most established categories can accept new products pushing two Ps max, with one or both at radical. Only in brand new categories, with lots of turnover and new launches, can you introduce innovation with three or more Ps and expect it to land with consumers.
So, if we look at the above products, we can see their innovation in a new light. Some are only innovating with one P, which makes sense for their category, while others hit on all four.
Old El Paso is pushing an incremental product change by partnering with Takis. Its incremental because the brand already has a bold and a lime-flavored version now. While not a dynamic category, the brand has a chance to push this P further with greater partnership with the chip brand, doing Blue Heat shells, creating a Wave shell, or even a lower carb nut version. There is a lot to explore with just one P.
KIND is pushing on 2 Ps, product and position. They had clusters, now they’ve dipped them. However, they’ve also positioned themselves in a different way, away from bars and more toward open bag snacking. Neither Ps are radical, which makes sense in the category. Incremental movement is getting the brand closer to a more causal type of snacking.
Skinny Dipped is on 3 Ps, Product, Position and Process. Not only have they moved beyond the snack/candy aisle, with a new product for a new target, they’ve also improved the way the product is delivered (in a stand-up pouch, which also makes it easy to snack on). Is three Ps too much here? I think the benefit of less sugar makes sense for the baker looking for something better, but the question will be whether the brand name translates to a new aisle.
Lastly, Miyoko’s is going all out with a four 4P change, two of which could be considered radical. Vegan cheese is the brand’s norm, but liquid is a bold and innovative choice. With the added new message focusing on greenhouse reduction, I would say the company is changing the paradigm around the brand as well. However, for such a new category 4P much just be possible.
Media-First CPG Brands?
In the early 1970’s, the US film industry was in shambles. A weak economy and a series of commercial failures had bankrupted several big Hollywood studios and sent audience attendance to record lows. However, Nixon era tax breaks made investing in films by non-traditional companies a logical way to diversify a portfolio.
This partially explains why, in 1971, Quaker Oats (yes, Quaker Oats) decided that they wanted to make a movie. Not just any movie, but one that would introduce a whole new brand of chocolate and candy. The movie was Willy Wonka and the Chocolate Factory, today a cult classic, but at the time both a box office dud and a poor vehicle for candy advertising. Part of this had to do with Quaker’s struggle to launch their chocolate brand in time for the movie’s release, but also because the marketing was sub-optimal. However, today the brand still lives on under Ferrero Group ownership.
It is easy to write off this CPG+media collaboration as merely an interesting historical footnote, but I prefer to see it as prescient. While CPG product placement in films and TV shows has become commonplace, it has yet to again reach the level that Quaker was aiming for fifty years ago. However, I think that may soon change.
Unless you are living under a media rock, you know that the Korean show Squid Game is an international phenomenon, becoming the #1 most watched program on Netflix in 90 countries! While this level of international success alone is unique, it coincides with the streaming giant’s recent attempt at monetizing their content. Netflix Shop gives viewers the chance to buy merchandise from their favorite shows—from Witcher statuettes to player 456 shirts, the company sees money in monetizing fan interest. The bad news is that Netflix grossly under-estimated the power of Squid Game and are now scrambling to create merch for their standalone site (Of course, with this much money to be made, external brands are currently filling the void with everything from Dalgona candy (Ppopgi) kits to dry ramen snacks.) However, the good news is that they realize the power of monetizing their creations and have created a partnership with Walmart, Netflix Hub at Walmart, a store-in-the-store that sells only products inspired by Netflix’s popular shows.
However, the bigger question is how long before Netflix, HBO or (especially) Amazon flip the script and start green-lighting projects with the primary intention of selling merchandise. It’s not unheard of from big studios, look at Disney. They showed how they could reinvigorate an old ride at their theme part with a movie called Pirates of the Caribbean, and now they are trying it again with this year’s Disney+ launch of Muppets Haunted Mansion. Just look at this new Nailed It Baking Kit available through the Netflix Hub at Walmart. Together with Nailed It cookbooks and other merchandise, its easy to believe that the whole point of the show is to sell swag:
I believe we will soon see a CPG company funding (or jointly funding with another company) a TV show, streaming movie, web series, video game or other media just to build a brand from its success. If it has a screen, it can be a monetization machine. For example, Chobani just launched a limited-edition line of the Chobani Complete yogurt shakes with the image of popular Peloton instructor Cody Rigsby on the front. Could an exercise focused brand start a Peloton ‘event’ to kickstart a product?
Origin Stories
Casa Firelli has introduced a range of Italian hot sauces to the US market. Handcrafted in Parma, from Calabrian chilis, the medium spicy sauce is specially formulated for use on pizza and pasta. The 5-oz bottles are available directly from the company via their webpage.
Olyra Foods is introducing a line of breakfast biscuits made from a mix of nutritious, ancient Greek grains. By combining oat, spelt, barley, and lupine, the biscuits are said to supply sustaining energy. The biscuits are available plain or sandwiched with chocolate, hazelnut or yogurt filling.
Ayo Foods has now expanded distribution of their West African-inspired cuisine into Target stores nationwide. The brand, which launched last year, currently features jarred sauces, frozen meals, rice-based sides and dessert.
So What? Prior to 2005, if you’d asked an American what country they associated with yogurt, there is a good chance they would have said France. The years of market dominance by French brands and companies, like Yoplait and Danone, had cemented the idea that yogurt was a Franco-food.
However, Chobani’s arrival changed perceptions. We correctly give a lot of the credit for its success to its high protein, low sugar profile fitting with shifting health perceptions. However, not enough emphasis is given to the fact that Chobani spurred interest by altering yogurt’s origin. It may seem strange to imagine now, but few people had heard of Greek yogurt 15 years ago, and its arrival made people rethink a sleepy category and imbue it with new benefits.
Why should hot sauce be only associated with Latin American or Asian cuisines? Classic pizza parlors have always had a shaker of red pepper flakes, so why not hot sauce? Similarly, why are breakfast biscuits so very British in their perception (at least in the States)? Then there are countries we rarely ascribe cuisines to at all—such as most of Africa—when in fact they have vibrant and beautiful histories.
What other sleepy category could be roused with a switch of culture?
Brands I’m Watching
Burger King Korea has partnered with pet food company Harim to produce the ‘Real Dogpper,’ a collaborative menu at the fast food restaurant that customers can order for their dogs. The menu consists of a dog-safe version of the Whopper as well as a flame-grilled bone. So What? This isn’t the first time that Burger King has added a treat for dogs into their bags. Last year, in the States, and in 2019 in Korea, the company added the flame-grilled bone to orders. In Korea, the company saw the pet treats equate to a 20% rise in orders, spurring other chains (such as Mr. Pizza) to add similar offerings. All of which likely means that this won’t be the last time that we’ll see pet food companies and foodservice come together. Earlier this year Starbucks filed for a trademark on their ‘secret menu’ Puppucino, and the filing also mentioned pet apparel. Restaurants understand that for many consumers, having their pets enjoy a meal too might just tip the scale in their direction. I foresee more dog-friendly offerings in the future as restaurants try to get more customers through their doors, drive-thrus and deliveries.
Food tech start-up Better Brand has introduced their first product: The Better Bagel. Fresh off a new round of investor funding led by Seven Seven Six (a firm developed by Reddit’s co-founder Alexis Ohanian), Better Brand is launching a bagel they claim has the net carbs of two banana slices, the sugar of a stalk of celery, and the protein of four eggs. Using modified enzyme technology, the company is about to produce a bagel that (compared to eating a regular bagel) “helps lower insulin, keep you full longer and positively impact gut health.” So What? Is this the ‘Beyond Meat’ of carbs? I’m not sure if it’s a direct comparison. With meat alternatives, the cumulative benefits are beyond health, into ethical, environmental and social parameters. Better Brand’s benefit, even from the company’s POV, is about not feeling bad about indulgence. That’s a very good benefit, but will it be enough? Very interesting space to watch.
Newly launched company Do Good Foods has announced the formation of Do Good Chicken. A brand committed to fighting climate change by eliminating food waste. So What? What’s fascinating about Do Good is that it isn’t a brand as much as its an infrastructure project. The company, backed by a $169 million investment from Nuveen, upcycles the food waste from grocery stores and converts it into chicken feed. The company claims that the first production facility in Pennsylvania has the capacity to take in and convert 160 tons of surplus food from approximately 450 grocery stores every day, and about 60,000 tons annually. The company says they will replicate the model across the country over the next 5 years. Honestly, these are the real growth companies in the next few years. As measurable, scalable environmental messages become brand building blocks, large-scale up-cyclers and carbon sequesters are the next multi-billion dollar tech companies.