Few companies are as synonymous with canned fruits and vegetables on the grocery store shelf as Del Monte Foods.
But for much of its recent existence, the 133-year-old business was so focused on maintaining dominance in a space it has come to define that it missed out on ways of unlocking the potential for its brands in other areas, the company's CEO said in an interview.
In an effort to better position itself to tap into consumer trends such as snacking, convenience and healthy eating, Del Monte — which is the brand by that name focusing on canned and preserved fruits, vegetables and produce —is expanding its offerings as it introduces frozen and refrigerated products for the first time and moves into other parts of the grocery store, such as the deli.
In the next two years, Del Monte also plans to go beyond grocery stores into e-commerce, convenience stores and warehouse clubs to create more opportunities for customers to experience their products.
The goal of the "new Del Monte," as CEO Greg Longstreet called it, will build upon its brand equity, history and position as one of the first plant-based companies to become a more innovative and agile organization in order to get products to market faster — an imperative among food companies in today's fast-changing market place. If Del Monte's strategy is successful, Longstreet is optimistic the privately held company could increase sales by $300 million to roughly $1.78 billion by 2022.
"We should be thinking bolder and thinking outside the can to grow and innovate and differentiate, and we've set course for a very aggressive innovation agenda," Longstreet told Food Dive ahead of the unveiling of its new product lineup at an event this week in New York. "We had this untapped potential for the brands."
While much of the product rollout this week centers on its namesake brand, Del Monte also is expanding the offerings for two of the other brands in its portfolio: Contadina tomato products and College Inn broths.
Contadina has pizza bites while Del Monte has its own bites stuffed with ingredients such as spinach and feta and broccoli and cheddar. Both brands are embracing cauliflower crust in their offerings. Del Monte also will be selling a non-dairy refrigerated probiotic parfait in the produce department, veggie-based dips that could be a lower-calorie alternative to hummus and veggie bowls featuring ancient grains.
College Inn will expand its reach with a convenient all-in-one sauce called Simple Starter that contains broth, seasoning and spices. The consumer just needs to add in the protein or pasta.
"We're this American icon, this trusted brand that consumers look to and lean on to provide health and convenience. We're finally leveraging that," Longstreet said. "Our brands have been part of the consumers' lifestyles for a long time, but now as consumer trends change and behaviors change, we must change as well. And that's what this whole effort and this whole transformational journey and innovation journey is about."
To increase its likelihood of success, Del Monte is expanding its marketing department and spending more to promote items as they hit the market.
It's using co-packers and co-manufacturers that will, among other things, provide insight into making products in niches such as frozen that Del Monte might not be familiar with, or have the ability to make on its own. It's also thoroughly vetting the products with consumers and retailers to gauge their interest in eating and carrying the new items before they introduce them. Retailers of all sizes have signed on to carry some of the new lineup, Longstreet said.
The company does come with a valuable advantage in name recognition — 98% of consumers are aware of the brand and six in 10 people currently have its products in their homes, Longstreet noted.
"We've increased our odds of success, but we do know it's a very, very competitive landscape out there," he said.
The focus for Del Monte has been solely on brands the company already has in its portfolio. Unlike other competitors in the food space, Del Monte has not used M&A, a popular tool for big companies eager to spur growth and quickly boost their presence in fast-growing areas. Longstreet said the company wouldn't rule out a deal if it offered the right skills or capabilities.
"We don't have to do (M&A) at Del Monte. We have the brands. These brands have a long runway of growth potential," Longstreet said. "There is so much more innovation from within that we can do. We're just starting this innovation machine, running it full steam and I look forward to seeing what the next 12 to 24 months have in front of us as we bring more and more of these great ideas to market."