Over the past few years, center store brands have been hurting –canned foods in particular. The slowdown is to the point that packaging producer Ball recently decided to cease food can production at one of its manufacturing plants, citing “the overall decline in food can demand.” Given consumers penchant for “fresher” foods, soup producers, including CPG leaders Campbells and Progresso, have been forced to come up with new lines to appeal to shoppers: First Campbell’s with its release of two lines of refrigerated soup and now Progresso with its recent launch of an organic canned soup line.
For Progresso the choice to go organic was a way to bring new food principles to center store, according to associate marketing manager Katie Lilly.
“We viewed this as an opportunity to get people back into center store by allowing consumers more center store options that align with their food values,” Lilly told NOSH. “Consumers still value convenience and great tasting soup, and that is something we know we can offer.”
The convenience aspect of canned soup is something that does play to busy consumers’ desires. Shoppers might prefer a scratch made soup, but lack the time or know-how of how to execute it. The opportunity then arises for producers who can step in and fill that void while still maintaining a “homemade” taste.
While being labeled organic may seem like it would only attract more consumers, for some shoppers, Progresso found that it can also be a red flag.
“For many Progresso consumers, organic offerings can seem unapproachable,” Lilly said. “Many consumers today aspire to eat more organic food, but we found through our research that’s often easier said than done. Some of the barriers are taste and convenience… We also frequently found consumers thought organic soups didn’t taste as good as they would expect.”
There is also a barrier to break through in regards to consumers who may have had negative experiences with other canned soup brands. To better reach those consumers, the brand kept some traditional Progresso design elements while “canning” others. The end result keeps Progresso’s signature colors, but has a more modern look and prioritizes the word “organic” over the Progresso brand in the message hierarchy. The brand also made sure to avoid adding a price premium; the organic line clocks in at under a dollar more than its conventional alternatives.The launch of the new line comes as Progresso tries to correct the historical mistakes of the overall soup set and gets ready for winter — prime soup season.
“Turning to our seasonal businesses, we talked a lot about getting in the zone on pricing this year, General Mills CEO Jeff Harmening told analysts during last month’s quarterly earnings call. “Last year, we missed the mark particularly on soup and refrigerated dough, so we’ve taken actions this year to make sure we’re more competitive.”
According to Lilly, for the organic line the company has a multi-pronged approach to remain“competitive” including paid media support, digital sampling efforts and in-store pricing promotions for the new line. It’s to be seen how these efforts will help with sales.
While it may seem contradictory to roll out a new canned soup line while the center store is struggling, General Mills has seen success with its natural and organic portfolio, which has seen double-digit growth led by Annie’s. As stated on earlier quarterly earnings calls, General Mills expects their organic and natural brands to generate more than $1 billion in 2017.
Lilly says Progresso believes the new line, coupled with these efforts, will bring new consumers to the category.
“The canned soup category has slowed over the past couple of years, but what we’ve seen is that, within that category, natural and organic soups are gaining traction,” Lilly said. “People are looking for options outside of the current canned lines that match their values.”