just the answer - Ella's Kitchen CEO and founder Paul Lindley
Lindley details his growth strategy for Ella's Kitchen
UK baby food group Ella's Kitchen has rapidly expanded to become a household name and pantry staple for parents with pre-school children. New product development coupled with international expansion and moves into complementary categories has continued to fuel growth, while the brand is rumoured to have attracted interest from the likes Nestle. In this month's just the answer, Ella's Kitchen founder and CEO Paul Lindley talks to Katy Askew about the development of the brand and what the future might have in store.
just-food: What prompted you to found Ella's Kitchen? What are the principles behind the brand?
Lindley: I founded Ella's Kitchen because of my personal experience: at home I was the hands-on father to my young toddler daughter Ella, who had decided to get picky about which foods she liked; and at work I was deputy MD of Nickelodeon UK and knew much about the terrible obesity statistics for kids - with 1/3 of kids overweight as some 20% obese. I felt that I could create a brand that brought together health, handiness and - crucially - fun to baby and toddler food. The principles behind the brand are that children, just like adults, eat with all of their senses, so our brand seeks to stimulate each of their senses in a positive way so that they want to experiment and enjoy a wide variety of new foods early in life, to set up healthy habits that will last their lifetime. In a way, we seek to be good in every sense. We do this by putting children first, seeking always to be innovative and different and by creating a very personable brand.
just-food: A focus on health is something that you hear a lot about when products are targeted at the baby and toddler market. What differentiates Ella's Kitchen?
Lindley: Ella's Kitchen products only use the highest quality organic ingredients and are developed avoiding using refined sugars and salt. Our portions are age appropriate, disclosing all ingredients in full and are designed to encourage a balanced healthy diet. We always come from a child's point of view and as such have pioneered new forms of packaging - ones that have revolutionised the baby sector, innovative recipes - for example, mixing fruits and vegetables together, and have only last month launched a range of chilled desserts without any added sugar or concentrates, choosing instead to have the most fruit in volume in the market in, for example, our fromage frais range. Our brand seeks to stimulate all of the senses and encourage as much exploration with food as possible.
just-food: You have launched a number of products of late. How important is NPD to keep the brand fresh? Can you tell us about any NPD in the pipeline?
Lindley: As a challenger brand, NPD is vital for our continued growth, and for meeting our consumer demands. Our total focus is in understanding families and their needs and our insight allows us to develop products that add to the choice in the market, not copy existing choice. That's really important for an innovative, entrepreneurial business. We have high, measurable targets for NPD contribution, and in the last 12 weeks we have launched 14 new lines as well as launching in three new countries.
just-food: Expansion has taken the form of rapid product launches into retailed product categories, most recently dairy and cereal. Is this one of your primary growth strategies?
Lindley: Yes, in putting our focus in understanding how families live their lives, we see gaps in the market and seek to create products, and packaging formats to solve consumer challenges or frustrations. Hence we discovered that there was confusion about when to introduce dairy for young babies and developed our staged weaning ranges in the chilled dessert section. [We also] innovated with the 'spouch' in the dried cereals area, bringing convenience and take-outability to the choices available to parents. All these new products have simple ingredients, fully disclosed and obviously have no cheap, filler ingredients, improving parents' choice at fixture.
just-food: Is Ella's Kitchen still gaining market share in the categories where it is already well-established?
Lindlay: Yes, our overall share of all baby food continues to grow, as does the individual wet, dry and snack sub-sectors. Overall, we are almost 12% of all baby food and over 17% of wet baby food in the UK.
just-food: As a start-up in the infant food category, you are competing against some very big global players, companies that are able to invest significantly behind very well-established brands. Who would you say are your primary competitors and how have you been able to carve out a niche to compete effectively against them?
Lindley: The closest food 'products' to those we offer is home-cooked food, so we constantly seek to complement that activity to help parents when their lives are too busy or they are out and about. We do compete against the big multinational companies too, and have succeeded in taking market share and in growing the market because our brand is based on strong values and personality that are trusted and recognized - and which big companies often find very difficult to copy or replicate. We stand for something and it connects with our consumers' needs.
just-food: Ella's Kitchen has used some very effective marketing - with the sponsorship of kids TV shows etc. Can you provide some detail on your marketing strategy?
Lindley: Our marketing seeks to highlight our brand values and our product points of difference. We launched with national TV advertising, by collaborating with a major TV company to create marketing innovation in using unsold airtime for no up-front fees. Hence we didn't risk cash or pay for airtime before we were paid. This revenue sharing relationship continued for several years. Now much of our marketing budgets are spent on gathering insight and becoming leaders in understanding how families live. We use all marketing channels but remain simple and childlike in our messages and executions. It is effective.
just-food: In the UK, typically parents will buy speciality food for babies, but this trails off as children become toddlers and pre-schoolers. Are you seeing any changes to this behaviour? Do you expect category growth and increased penetration of speciality pre-school foods?
Lindlay: Babies, toddlers and pre-school children all have different and specific food needs for their different developmental stages and we look to understand these and to see what specific foods are possible to help. We think it would be beneficial to parents, children and retailers if the 'baby' fixtures contained foods that took baby into the next stages of development with specially created, age appropriate and portion controlled, differentiated products.
just-food: Can you detail your export presence? Do you see overseas expansion as an important growth opportunity? How are you expanding internationally?
Lindlay: By taking the simple proposition that people around the world are more the same than they are different, we believe that Ella's Kitchen can become a global brand with relevance in many new markets, if we spend the time to understand consumer needs and cultural differences in each market. We have a subsidiary company and Ella's Kitchen team in the US, whilst we export to 7 other markets, each time investing in understanding the local consumer expectations and needs. Following this approach we have secured a 20% market share of wet baby food in Norway and well over 10% in Sweden. We launched in Australia, Hong Kong and Finland in recent weeks.
just-food: There has been some talk that Ella's is a potential takeover target for the likes of Nestle, Danone and PepsiCo. Would Ella's Kitchen be open to working with a large multinational - either as part of a full takeover or through some kind of partnership arrangement?
Lindlay: We remain totally open minded about the best way to grow and provide more best quality, innovative products, under our entrepreneurial, values based, kids first, multi-sensorial brand.
Heinz stunned the global food industry with news it had agreed to a US$28bn takeover offer from Warren Buffett's Berkshire Hathaway fund and private-equity firm 3G Capital - purported to be the larges...
- On the move: What's in store from Tesco's new CEO?
- The just-food interview: Premier Foods CEO Darby
- On the money: Danone denies strategy overhaul
- On the money: Unilever shifting into growth spots
- Comment: Danone could be mulling strategy shift
- UPDATE: Premier establishes international unit
- Campbell issues warning on 2014/15 fiscal year
- S&A Foods announces restructure, 55 jobs to go
- Premier sales slide but trading profit improves
- Unilever sees lacklustre H1 food sales