Filling the void
March 5, 2012
by Bryan Salvage
Minong, Wis.-based Jack Link’s Beef Jerky, a Link Snacks Inc. (LSI) business, was born through an entrepreneur’s desire to create a better-quality, more-consistent beef jerky than was available more than 25 years ago. Since its humble beginnings, the company has evolved into the leading US meat-snack brand and fastest-growing meat-snack manufacturer in the world – operating eight manufacturing plants globally along with several distribution facilities.
Jack Link’s has earned the No. 1 share in the category, says Jeff LeFever, director of marketing. For the 52 weeks ending Dec. 26, 2011, Nielsen reported Jack Link’s dollar share at 46. When you combine that with the company’s Matador and World Kitchens brands, it has a 53 dollar share. Jack Link’s had 26 of the top 35 items in the meat snacks category in 2011, Nielsen relays.
Although the privately held company does not discuss sales, it does say sales continue to increase year-over-year. For the 52 weeks ending Dec. 25, 2011, SymphonyIRI Group lists LSI’s sales (Total US FDMxC – supermarkets, drug stores, gas/c-stores, and mass market retailers excluding Walmart) of All Other Dried Meat Snacks at $292,209,100, 7 percent above the same year-earlier period. Sales for the Jack Link’s brand totaled $230,092,400 – 5 percent above the same year-earlier period. Sales for the entire dried meat-snacks category totaled $1,477,046,000 – 12 percent more than the same year-earlier period. LSI jerky sales totaled $398,044,700, 17 percent higher the same year-earlier period. Jerky category sales totaled $710,347,200 – 12 percent above the same year-earlier period.
Craftsmanship is key
When making high-quality jerky and meat snacks, craftsmanship trumps automation, especially when you’re starting a business, says John (Jack) Link, founder, chairman and CEO of LSI and Jack Link’s Beef Jerky. “After you create a top-selling product, you can automate and change things a little. But craftsmanship still prevails in this industry,” adds the veteran meat-man and patriarch of the company. (Visit www.jacklinks.com for more information on Jack’s background and the company.)
Employed full time at Jack Link’s since 1993 after graduating from college, Jack’s son, Troy, was named president in 2001. “We balance each other very well,” Troy says of working with his father. “We both have a great entrepreneurial spirit, we’re very aggressive and we’re focused on setting and reaching goals. We eat, sleep and breathe meat snacks – we’re passionate about this business.”
Troy started working at his father’s company when he was 16 and in high school. He has worked just about every job in the business, including in the slaughter area (the company no longer slaughters animals), processing, working in smokehouses, plus sales. While attending college, he handled a sales territory. After college, he immersed himself in sales, marketing, supply-chain management and new product development.
Jack Link’s produces meat snacks in a variety of forms, textures, flavors and sizes for domestic and international markets. “Our product count typically averages between 1,000-1,500 SKU’s and fluctuates based on consumer, customer and market demands,” says Terry Smith, executive vice president of operations.
Products include jerky, steaks (premium slices of 100 percent meat), sticks, Sasquatch-sized snacks, nuggets, combo packs, Classics sticks and jerky, portion-controlled snacks, Smokehouse jerky and meat sticks, plus specialty products, such as its jerky chew, pickled sausage, beef jerky tender strips, as well as beef pork summer sausage. The company’s meat snacks are made with a variety of proteins including beef, turkey, chicken, pork and buffalo.
“Our jerky sales continue to be strong, led by our most popular flavors – Jack Link’s Original Beef Jerky, Jack Link’s Teriyaki Beef Jerky and Jack Link’s Peppered Beef Jerky,” LeFever says. “Our new Sasquatch Big Sticks line has been performing really well and is driving growth in the sticks segment. Steaks also finished the year very strong.”
The meat-snacks category is in a strong position for continued growth, given that it meets three key consumer trends in snacking – convenience, healthy choice and satiety, he adds.
Although the core of the category remains the millions of outdoorsmen and 20-plus-year-old males, emerging new consumers are important when looking at total category growth, LeFever says. As the category evolved, Jack Link’s has adapted to the changing demands of the emerging, more mainstream consumer.
While perceived as a male-dominated snack, almost as many women as men eat Jack Link’s meat snacks, LeFever says. “We have people in every demographic who enjoy Jack Link’s products,” he adds. “We’ve focused on creating products that appeal to young people, men and women of all ages.”
Jack Link’s still has a major opportunity to communicate its products’ benefits to a larger, mainstream audience and continue to grow the penetration and frequency of use in the category, he says.
Jack Link’s continues to be the innovation leader in the meat snacks category, says Kevin Papacek, brand manager - innovation. “Since 2009, more than 10 percent of our branded-dollar sales volume has come from new products,” he adds. “Jack Link’s continues to develop new flavors, forms and packaging to meet consumer needs.”
New products launched during the past year include Jack Link’s Classics, a new line of sticks and jerky with traditional flavors; Sasquatch Sticks and Steaks, which are line extensions of the Sasquatch Big Snacks line; and the new Furious stick (Hot!) and two new Sasquatch Steaks – Angry (Original) and Zen (Teriyaki).
“The entire Sasquatch line brings the fun of our Messin’ with Sasquatch advertising campaign into the real world,” Papacek says. “Products in the Sasquatch line are larger than standard category offerings and have bigger, more intense flavors.”
Two new Jack Link’s Steaks line extensions include Steakhouse Recipe Beef Steak and Oven-Roasted Turkey Steak. And Jack Link’s Cholula Hot Sauce Jerky is a new beef jerky flavor. Hot sauces continue to grow in popularity, and hot flavors are the No. 4 flavor segment for jerky behind Original, Teriyaki and Peppered.
“We love the flavor of Cholula Hot Sauce – no surprise they’re the fastest growing hot sauce brand. The introduction of Jack Link’s Cholula Beef Jerky is a great example of how two leading brands, in their respective categories, collaborated to introduce a product that delivers on consumer expectations” Papacek says.
Jack Link’s constantly introduces new products and tries to attract new users, Troy iterates. “We have many new poultry items coming,” he adds. “And, we have a new line called Big Dippers coming soon. Our Nugget and Tender lines are designed for a much different eating experience versus traditional, natural-style jerky. We just launched a new, unwrapped, fresh-jerky line in c-stores. We’re expecting big things out of that product.”
Jack Link’s current products already have a healthier nutritional product profile than many other snacks – high in protein, low in fat, low in carbs and low in calories. However, the company is constantly researching ways to improve its products’ nutritional profiles, Papacek states.
“Marketing is a real passion for our organization,” Troy says. “We’re a futuristic company – we do business for the long-term.”
The company’s current ad campaign places Jack Link’s jerky-eaters in a series of unexpected situations where they tap into their wild sides to play pranks on Sasquatch – it’s called Messin’ with Sasquatch, LeFever says.
This helped to shape the now iconic campaign, which goes far beyond ads and includes various consumer interactions and brand experiences via Facebook, YouTube, public relations, experiential, augmented reality and consumer-generated content. This ad campaign has been key in driving Jack Link’s brand awareness, he adds.
When asked if Jack Link’s might diversify its product offerings, Papacek says Jack Link’s mission is to maintain being the No. 1 shelf-stable, meat-snacks provider in the world.
There continues to be opportunity for new product development within the meat-snacks category, driven by evolving consumer tastes, he says. “The key to driving significant growth will rely on bringing products with flavors that attract new users to the category and offer taste varieties that encourage more frequency among current users,” Papacek continues.
Packaging plays an important role in the company’s continuing success. Jack Link’s completed a major package redesign several years ago, and it continually tries to improve its packaging by adding options such as EZ-Peel film to make the package easier for consumers to open, LeFever says. “We’re constantly working on creating better barrier properties to help retain product freshness,” he adds.
One example of a past-product improvement, and a likely factor contributing to growth in the Nuggets segment, is the recently added window on the back of the line’s foil bag.
“We’ve innovated a way to maintain the barrier properties, yet now consumers can actually see the premium quality of the nugget product inside the package,” LeFever says. “A window on our nugget package was one of our No. 1 consumer requests and we made it happen.”
Jack Link’s Beef Jerky operates four manufacturing facilities in the US that process a variety of meat snacks. Its corporate office plus one production facility is located in Minong, Wis. The other production facilities are located in Alpena, SD, which includes a new R&D center; New Glarus, Wis.; and a recently acquired plant in Mankato, Minn.
In Sept. 2010, Jack Link’s announced it was acquiring the Mankato facility from São Paulo, Brazil-based JBS SA. This acquisition enabled Jack Link’s to increase its production capacity in order to meet growing consumer demand for the Jack Link’s brand.
Jack Link’s primary distribution center is in Laurens, Iowa. Last October, Jack Link’s acquired a distribution facility in Underwood, Iowa, from The Oriental Trading Company. In addition to shipping, receiving and product merchandising support, the new center will increase Jack Link’s distribution center and warehouse capacities.
Jack Link’s also operates three processing facilities in Brazil (one in Tres Rios, two in São Paulo) and a facility in Auckland, New Zealand, which handles manufacturing, sales and marketing for the Asia/Pacific market. All four facilities make jerky and other meat snack items.
When acquiring the Mankato plant, Jack Link’s announced it was also entering a joint venture with JBS SA to operate the two processing plants in São Paulo, Brazil. This partnership has helped Jack Link’s to ensure an adequate supply of product to meet growing demand plus provide flexibility in its supply chain.
“It has been going very well,” Jack Link says of the partnership. “They’re good folks. We’re able to draw on each other’s strengths.”
All Jack Link production facilities are USDA-inspected, certified and regulated (or the international equivalent or designation), Smith relays. Several facilities are Safe Quality Food-certified. Jack Link facilities follow the USDA/FSIS guidelines on HACCP, SOP and SSOP.
Jack Link’s invests heavily in its processing operations. It recently revamped its kitchen floor in New Glarus, which involved installing new grinders and mixers. The company is also in the process of buying 10 new smokehouses. “Since about 1970, we have been buying new processing and packaging equipment – not used equipment,” Jack says.
The Minong plant is also undergoing an expansion project. Made possible by the Village of Minong, it involves a $356,000 Community Development Block Grant for Public Facilities for Economic Development from the Wisconsin Economic Development Corporation (WEDC). The project will involve building a 7,000-sq.-ft. processing addition to its existing facility plus a 6,700-sq.-ft. warehouse facility. It also calls for buying more ovens and packaging equipment. The expansion is expected to create 70 full-time jobs over the next three years.
Along the way, Jack Link’s products, marketing campaigns and web site have won many honors and awards – too numerous to list in this article. One such honor, however, is Jack Link was named the Ernst & Young Entrepreneur of the Year 2010 national winner in the Retail & Consumer Products category.
Did Jack Link ever think his company would become this large? “No,” he replies. “My hope was to be successful and take care of the people working for the company. We have a wonderful team, we’re like a family.”
When asked if the company plans to buy or build more manufacturing or distribution plants, Link answers, “Yes. We’ll probably be Greenfielding several operations in the short-term.” Further international expansion is also possible. “You order it, we’ll ship it,” Link quips.