Campbell Soup Co. president and CEO Doug Conant today (17 February) underlined the importance of the US food group plans to revamp its condensed soup business.
The Campbell boss said sales volumes of condensed soup in the US had been “stronger” than they had been “in several years” as cash-strapped shoppers continued to be “price-sensitive”.
Speaking at the CAGNY investor conference in Florida, Conant laid out Campbell’s plans to “fire up” its condensed portfolio, which accounts for half of the company’s US soup business.
He said condensed soup generated over US$1bn in net sales in fiscal 2009 and a “substantially larger” percentage of the gross margin the company gets from soup.
The company will improve some 60% of its condensed soup portfolio through further lowering the salt content of the products, while new marketing campaigns will see Campbell stress the “American provenance” of its ingredients.
“Campbell is the only national branded choice in this critical space,” Conant said. “Our customers and consumers will see the biggest integrated programme of improvement that we ever undertaken.”
He added: “We’re very optimistic that this total package will drive preferred value and improved volume performance for our high-margin, high-share and highly profitable condensed soup business.”
The economic downturn and weaker consumer spending has weighed on sales of ready-to-serve soups in the US. Conant said shoppers had found ready-to-serve soups “a less compelling value proposition”.
When asked why Conant’s address to CAGNY had shed less light on Campbell’s ready-to-serve business, the Campbell chief said: “We’re highlighting condensed [soup] because we see it as a unique growth opportunity right now, where we are the only branded player in the segment and there is significant opportunity to improve our position there.”
“We’re well positioned to compete in ready-to-serve and we’re very comfortable with our position. We’re outperforming any other branded players right now. We’re well positioned for the long term but obviously we have some work to do in the near term.”