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Soup-To-Nuts Podcast: Key strategies for innovation & renovation from Kraft Heinz

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By Elizabeth Crawford

11-Aug-2017
Last updated on 11-Aug-2017 at 17:39 GMT2017-08-11T17:39:28Z

Soup-To-Nuts Podcast: Key strategies for innovation from Kraft Heinz
Soup-To-Nuts Podcast: Key strategies for innovation from Kraft Heinz
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A commonly held perception of the ongoing renaissance in the food and beverage industry is that only small, nimble startups are innovating to meet consumers’ evolving needs, and that large, legacy companies must acquire or incubate new brands to keep up.

But is that true?

On the on hand, there certainly are a lot of new companies bringing bold ideas to market, such as snacks made from insects and waters made from bananas, but a closer look at the new products, marketing campaigns and packaging concepts rolled out in recent months by Kraft Heinz – which is arguably one of the largest players in the industry –  suggests that big food companies are not only capable of innovation, but they are excelling at it.  

In this episode of FoodNavigator-USA’s Soup-To-Nuts podcast, Nina Barton, Kraft Heinz’s senior vice president of marketing, innovation and research and development, talks about how Kraft Heinz is keeping its iconic brands relevant to consumers today through innovation as well as rolling with consumers’ changing eating patterns and dietary demands.

While she acknowledged that acquisition can be a powerful tool for reshaping a company’s portfolio to meet consumer needs, she said Kraft Heinz is all-in right now on innovation and renovation of its existing brands, which she notes have strong equity and high household penetration that work in the company’s favor.

“We are very proud of our position in terms of innovation. You know, in the last year we have actually been able to double our innovation output,” she said, adding that Kraft Heinz has created a dedicated team focused on breakthrough innovation to ensure the company continues to focus on forward looking trends and ensuring it is delivering against the needs of the next generation.

In particular, she says Kraft Heinz is tracking and innovating around three major trends: snacking, clean and healthy ingredient profiles and bold flavors.

Taking a closer look at each of these trends, starting with snacking it is clear Kraft Heinz was an early player in the now booming protein snacks space with the award-winning launch of its P3 Portable Protein Packs, which has provided the foundation for countless other extensions across the company’s portfolio.

“We launched P3 a few years ago and it started off with some options in the meat, cheese and usually nuts. … We have now take that idea and expanded it further to the P3 Protein Plates, which is basically a larger size version of that, which I think is about 60% more food. And then we also looked at Oscar Mayer natural meat and cheese plates. Those are two examples of where we are able to take that trend of protein snacking and expand it past just the individual P3 packages,” she said.

Cleaner ingredients: Renovation as a form of innovation

Given the popularity of protein right now, Barton said the company also is focusing its innovation efforts on its center-of-the-plate proteins by reformulating Oscar Mayer hot dogs to meet consumer desire for ingredients that they can feel good about.

“Obviously it is an incredibly iconic brand and one that we are very proud of … so as we thought about how we would look at this, we approached it the way we approach a lot of our renovation, which is that we never compromise on taste. And that is what was important and we spent almost a year focusing on the right recipe,” that met consumer demand for no nitrates or nitrites, no artificial preservatives, no by-products and also maintained the same price point that the brand is known for, she said.

The company then supported the reformulation by taking the Weiner Mobile on the road and putting hot dogs in hands of people for an ultimate taste test.

Another example of the care Kraft Heinz takes when renovating a brand by cleaning up the ingredient deck is the reformulation of the company’s iconic Macaroni & Cheese. This example is notable because it walked a tight rope between two very different marketing approaches. On one side is stealth mode and the idea that if consumers know something is changing about a brand they love, they may decide it isn’t as good even before they taste it. And on the other making a big splash and shouting about the product’s cleaner profile.

Dissecting Kraft Heinz’s approach to marketing the Macaroni & Cheese makeover, Barton said the decision about whether to boldly advertise innovation or stealthily put it in the market and let consumers decide for themselves varies product by product.

“Every time we are faced with a new renovation like this, whether it is our Mac & Cheese business or our Oscar Mayer [business] we tend to look at a couple of things. We look at our consumers and what they really want. We look at how iconic the specific taste is and we will look at where the trends are going and make a determination,” she said.

However, she added, more often than not the company falls in favor of transparency rather than stealth.

Kraft Heinz’s dedication to innovation versus renovation also shines across the company’s diverse portfolio, as Barton explained. She pointed to the company’s new Philadelphia Cheese Cake Cups, Max by Maxwell House, which allows consumers to customize the caffeine in their cup of coffee, and new homemade-like macaroni and cheese from Cracker Barrel.

Kraft Heinz brings Oprah Winfrey to grocery store shelves

The company is also innovating through partnerships based on the old adage that two heads are better than one, and as a result will launch later this fall a new line called “O, That’s Good,” with Oprah Winfrey.

The line is the first from the joint venture the company has with Oprah Winfrey called Meal Time Stories, which will launch in October and will include soups and sides that are free from artificial flavors and colors and bring together the idea of comfort food with a twist, Barton said.

“For example, we took our mashed potatoes, removed some of the potato out of it and replaced it with cauliflower. And it allows the consumer to do the twist that they would have, while getting real food. And then it is also a convenient, ready-to-eat experience,” she said.

Marketing innovation

Innovation at Kraft Heinz isn’t just limited to new product development and renovation – it also shines through the company’s marketing campaigns, such as the playful Kraft Macaroni & Cheese Mother’s Day campaign earlier this year that featured Melissa Mohr.

Another example of innovative marketing is when Kraft Heinz played a practical joke on the city of Chicago earlier this year to promote its ketchup.

Barton explained that in Chicago people don’t put ketchup on a Chicago-dog, so the company said it created a special sauce just for the Chicago-dog to get people to try it. As Barton noted the response was “passionate” but the campaign created buzz and showed that Kraft Heinz is having relevant conversations with consumers.

A word of advice: focus on the consumer

Reflecting on all that Kraft Heinz has achieved in innovation, as well as her long career with other major companies, Barton says the main take away for innovation to be successful is to base it on consumer needs.

“One thing that I instill in my team that I learned early in my career … is the consumer has to come first and when the consumer is at the center of everything and you are meeting the consumer needs, you will succeed,” Barton said. “When we have problems with innovation it is that they are not fundamentally listening to the consumer and what her needs are. … When you put the consumer first, you win.”

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