Tyson Foods leveraging Hillshire innovation

by Keith Nunes
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Hillshire Farm Naturals turkey breast lunch meat
The company is focused on bringing clean label varieties of products to market.

LONDON – With the integration of Hillshire Brands well under way, the focus at Tyson Foods has turned to execution. Company executives are working to maintain the innovation momentum Hillshire had attained prior to the acquisition in 2014.

“Our goal is to deliver top-tier performance within the consumer packaged goods industry where we compete,” said Andy Callahan, president of retail packaged goods for Tyson Foods, during the Consumer Analyst of Europe (CAGE) conference on March 18. “We have an advantaged portfolio of brands in very attractive categories and a model to build those brands and grow over time faster at a rate than the food and beverage industry in total …”

Callahan described Tyson’s innovation pipeline as “robust” and detailed which consumer need-state categories the company is targeting.

“The consumer landscape is changing,” he said. “The way consumers shop is changing. They used to go to 12 stores. They are not going to less stores, but they are making more trips …. The millennial consumers, about 27 percent of the total consumer base, it is the largest cohort in history and they are evolving in their purchasing power over time.”

Noting that consumers are eating seven meals per day, snacking more and focusing on getting more protein in their diets, Callahan emphasized Tyson Foods has the insights to identify what is important to consumers today. The company segments its consumer targets into four platforms for growth within the Tyson’s portfolio of products, including:

• Breakfast reinvented, which includes new solutions for a convenient, complete and assembled breakfast;
• Smart shortcuts, which focuses on higher quality and unique meals with less preparation;
• Purposeful snacking, which includes handheld and shareable products; and
• Holistic wellness, which Tyson Foods describes as “foundationally nutritious products for our most disciplined consumers.”

As an example of the breakfast reinvented platform, Callahan noted years ago the Jimmy Dean brand only featured a roll sausage item.

“We moved into convenient breakfast, but most recently we have moved even out of breakfast into more anytime meals,” he said. “The reason we were able to do this is because Jimmy Dean within the frozen section has the highest loyalty and highest repeat of any brand. And we knew that there was a need for consumers to have more tasteful and convenient products outside of the breakfast occasion.”

Expanding boundaries is a key element of Tyson Foods’ innovation strategy, as exemplified by the effort to take the Ball Park brand beyond hot dogs.

“We extended several years ago into the hamburger section within frozen, and that is a platform for growth,” Callahan said. “It has one of the highest repeat rates of a new products launch in several years. Over nearly 40 percent of consumers who try it repeat it.”

The company also is extending the Ball Park brand into snacking with the introduction of a jerky item.

“We are going to disrupt this category with a product that is flame grilled which is differentiating within the category,” Callahan said. “And therefore it will taste better, and it will provide a tender differentiating opportunity within consumers. Our customers are extremely excited about this opportunity.”

Under the holistic wellness banner, Callahan noted the company is focused on bringing clean-label varieties of products to market. One such example is Hillshire Naturals lunch meat.

“What was differentiating about this product is it actually tasted better,” he said.

During the question-and-answer period, an analyst in attendance at the CAGE conference pressed Callahan on his thoughts about what is happening within the frozen-food category in the United States.

“My opinion is I do not believe that fundamentally frozen has a consumer issue,” he said. “I believe that the categories in which we compete in and have been able to grow where we bring innovation and bring consumer relevant solutions to and invest in, we have demonstrated the ability to be able to grow them. For example, even within our breakfast category millennials are some of the highest-indexed consumers within some of the categories in which we compete.”

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