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Soup-To-Nuts Podcast: Paid influencers make big impact with small budget in hot sauce category

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By Elizabeth Crawford

Last updated on 17-Feb-2017 at 15:37 GMT2017-02-17T15:37:33Z

Soup-To-Nuts Podcast: Paid influencers make big impact with small budget in hot sauce category
Soup-To-Nuts Podcast: Paid influencers make big impact with small budget in hot sauce category
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From restaurants’ fixation with ghost peppers to the presence of sriracha on dining tables across the country and chili pepper in everything from snack chips to hot chocolate, it is probably safe to say that America is obsessed with all things spicy. 

This is especially apparent in the billion-dollar hot sauce market, which has grown 150% since 2000, according to Euromonitor data. That is more than the growth of barbeque sauce, ketchup, mayonnaise and mustard combined.

But while the category as a whole may be on fire, the 45-year-old hot sauce brand El Yucateco wasn’t seeing this same growth – and it probably wasn’t alone as the category is crowded with competitors, many of which most consumers aren’t aware.

In fact, in 2013 the Mexican brand had very little awareness in the US. Sure, it was doing well among first generation Mexican Americans, but the company needed to increase awareness among bicultural Hispanics and general market consumers – the latter of which was perhaps more challenging.

So, with a very limited budget, The Padilla Group, which makes El Yucateco, teamed up with the influencer marketing firm Collective Bias and its ColectivaLatina Hispanic influencer community to launch a multi-prong social media campaign and paid influencer program.

Over three years, both sales and all commodity volume of El Yucateco increased 20%. Its red hot sauce saw sales climb 180%, green hot sauce sales shot up 111% and sales of its Caribbean sauce rose 70%.

It also increased its distribution to new retailers as well as its presence in existing retailers with expanded SKUs and flavor assortment.

To find out what is driving consumer demand for all things spicy and how exactly the companies achieved these results, this episode of FoodNavigator-USA’s Soup-To-Nuts podcast features Erin Conrad, the director of Collective Bias’ ColectivaLatina division, and Amy Wilson, the vice president of marketing communications at The Padilla Group.

What is driving America’s love affair with hot sauce?

Looking first at the macro landscape, Wilson suggests two main drivers of the hot sauce trend is a blending of other ethnicities in our culture and a changing economy.

“Over the last five to 10 years, the spice level has been increasing for consumers as far as their interest. It has really gone from what used to be more of an Old El Paso type medium spice level up into now … the ghost peppers and the habanero peppers and much spicier,” she said.

She attributed this shift in part to “different ethnicities blending more into our culture.”

She added: “It also had a lot to do with our economy and people shifting from eating out and traveling more and wanting to bring those cultures and flavors into their homes.”

Conrad adds millennials’ open mindset and desire for adventure also has a lot to do with hot sauces’ rising popularity.

More that hot

Looking at El Yucateco’s campaign, Conrad said a key component of its success was expanding the conversation about hot sauce beyond just how spicy it is to include more about the flavor it also brings

“What you will notice is that in a lot of our content we don’t really focus on hot being one of the key ingredients. We focus on flavor. So it is not just we are trying to make this as hot as hell and put your mouth on fire and see what you can resist. It is more about the adventure and the concept of how is it you are going to make food more interesting and flavorful,” she said.

Wilson added that this strategy worked well because consumers already were looking for more flavor and guidance from brands on how to cook more at home with a wider variety of spices. She also noted at that time consumers were starting to explore dishes from different cultures and ethnicities, which played nicely into El Yucateco’s heritage as a Mexican hot sauce. But the company didn’t want to limit its sauces to just Mexican fare.

“We don’t ever want to get away from the Mexican heritage or the fact that it is habanero pepper versus other types. We really want to be loyal to the brand and where the brand comes from and so don’t ignore that. But how do you take that and meld that into this fusion culture and help people know and understand how to use it,” Conrad asked. The answer, she said, is to have recipes come from expert influencers who are known foodies and lifestyle bloggers.

More than a condiment

Another key component of the campaign was to reframe the company’s hot sauce not just a condiment that is dripped sparingly on top of a dish, but as a key ingredient that is heavily used in making the meal, Conrad said.

Conrad said this concept was a little harder to sell to general market influencers, which reflects the level of education also necessary in the wider market.

When we started working w general market influencers we found some of them were a little scared,” and only wanted to use a teaspoon of hot sauce in a soup, Conrad said. The company had to show them how they could make it a prominent ingredient without overpowering a dish.

“The way you eat sauce really changes how it affects your food. So if you do just put it on your pizza or nachos or whatever the flavor punch you are going to get is very different than if you are mixing it into your dip,” Conrad said. She added, “I think it surprises people on how heat levels work and how the flavor does integrate when you use it differently.”

Wilson added that this strategy also opened up for the company more avenues in food service and working with chefs to use their sauces as a key ingredient in new recipe innovations.

She also noted that just because El Yucateco decided to focus on flavor in this campaign, its sauces still pack a significant level of heat – especially compared to what many mainstream Americans are comfortable with.

Directing consumers to point of sale

The campaign not only had to educate consumers about how to use the sauces, it also had to show them where to find them – which according to Wilson was a significant hurdle.

“One of the challenges that the brand has is if you are looking for hot sauce and you put it in your recipe and you go to the condiment hot sauce aisle. In most retailers, you will not be able to find El Yucateco there next to its top competitors. Where El Yucateco is placed is in the Hispanic aisle,” Wilson said.

“Part of what the influencers do is in the post you will see actual pictures of where this is, where you are looking for it. Find it next to the salsas and the hot sauce it is not in the condiment aisle. It is in the ethnic aisle or the Hispanic foods aisle,” she said.

She noted that this strategy not only drove sales and velocity, but it also saved the company from having to pay for special displays and end caps.

Ultimately, this case study shows that the sky rocketing sales in the hot sauce category do not need to be restricted to just the big players with their big marketing budget. Rather, a lower budget but well-targeted and focused campaign can help the dozens of less well-known hot sauce brands tap into the category’s growth as well.

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