Dive Brief:
- Kraft Heinz announced the launch of a new line of dressings and dips, as well as barbecue and pasta sauces, under The Pioneer Woman brand.
- The company is collaborating on the new products with Ree Drummond, creator of "The Pioneer Woman" website and cookbooks, and host of the Food Network show with the same name.
- Kraft Heinz's chefs worked with Drummond to develop the product line using high-quality ingredients and her favorite family recipes, according to a release. The dressings, dips and barbecue sauces are available now in stores across the country, while the pasta sauces will debut in May.
Dive Insight:
Condiments can be a lucrative segment for CPG firms, something Kraft Heinz knows very well. Kraft Heinz has collaborated on similar products. Last year, the company worked with the Food Network on a line of salad dressings, cooking sauces and meal kits. Its Springboard platform also partnered with restaurateur David Chang's Momofuku group on a line of Korean chili sauces.
Kraft Heinz has also made its own new condiment blends under the new "Saucy Sauce" category. These started with Mayochup — mayonnaise and ketchup — last year. This year, it's added Mayomust — mayonnaise and mustard — and Mayocue — mayonnaise and barbecue sauce. And earlier this month, it launched the most talked about mash-up, Kranch — a blend of ketchup and ranch dressing.
Not only is Kraft Heinz a condiments powerhouse, but it's making savvy business moves. A 2016 report from Packaged Facts said sales of condiments and sauces were up to $24 billion with no signs of slowing. The same report projected an annual 1.5% increase in purchases through 2021.
Drummond could be a lucrative partner for any CPG company. She already has a large audience because of her cookbooks, website and Food Network show, but this partnership could further enhance her profile and boost sales for Kraft Heinz. Statista research shows the Food Network had about 41 million viewers during a seven-day period in spring 2017. If Drummond mentions the collaboration and uses the products on her show, it could mean another publicity boost for the legacy manufacturer.
Partnering to combine on-trend products and star personalities in the food space could help keep Kraft Heinz on the cutting edge of innovation and differentiation. These items have flavor and convenience in common — two major draws for busy consumers who want healthy meals, but don't want to spend a lot of time preparing them.
The timing is good for Kraft Heinz to branch out with new products. The company's latest earnings report — which wrote down its Kraft and Oscar Mayer brands by $15.4 billion, resulting in a $12.6 billion net loss — also cut dividends and revealed a U.S. Securities and Exchange Commission investigation into its procurement, accounting and control practices.
Following those revelations, the company announced CEO Bernardo Hees would be stepping down June 30 and was being replaced by Miguel Patricio, chief of Special Global Projects-Marketing for AB InBev. Patricio told CNBC he plans to focus on ramping up Kraft Heinz' brands, growth, time to market and consumer orientation.
If the new Pioneer Woman collaboration and the company's other partnerships gain traction with consumers and prove profitable, they could help to smooth the path forward for the embattled company — and consumers can expect to see similar products hitting store shelves in the near future.