As Bolthouse Farms president Jeff Dunn breaks in his role leading the new Packaged Fresh division at Campbell Soup Co., the fresh carrot business remains Bolthouse’s core.
But whether in fresh carrots or elsewhere in the produce aisle or store, value-added is the company’s key to growth.
Dunn and Todd Putman, Bolthouse’s chief commercial officer, see those opportunities as substantial. In an interview with The Packer, they outlined the path ahead.
In January, Campbell Soup — which acquired Bolthouse Farms in 2012 — aligned its fresh, baking and shelf stable businesses in three new divisions. Bolthouse is the flagship for Packaged Fresh, which includes Campbell’s fresh soup business.
“The challenge is really to scale up our fresh business and make it a part of how people see Campbell,” Dunn said. “We’re about $1 billion out of $8 billion in sales for them, but the highest growth. We see a big sightline to try to double our business over five to seven years.”
“A lot of the innovation is focused on categories we’ve been in — carrots, beverage and dressings — but we see potential acquisitions as a way to keep growing our business,” he said.
Much as before, the carrot grower-shipper is opening new business avenues in those established categories.
In April the beverage offering is expanding with the introduction of 1915, a premium line of five organic, cold-pressed juices that Putman calls “fruits and vegetables in a bottle.”
In April, Bolthouse Farms is introducing 1915, a premium line of five organic, cold-pressed juices that chief commercial officer Todd Putman calls “fruits and vegetables in a bottle.” Distribution will be limited initially and build throughout the year.
In foodservice, New York City public schools plan to start serving Bolthouse’s Kids Veggie Snackers — baby carrots with chili and lime or other seasonings — on lunch lines in the fall after a trial in vending machines.
Bolthouse is still weighing where the other shoe — acquisitions — will drop.
“There are a lot of $15 million to $100 million businesses in spaces we find interesting for fresh,” Dunn said. “We see opportunity for continued acquisitions. But we’re trying to be more value-added than straight commodity. These will be businesses that have had success innovating or that we think we can leverage to become more innovative.”
The company sees value-added as broader than bagged salads, fresh-cut and beverage. The fresh soup business — much of it private label in grocery delis — Putman describes as “just another version of produce.”
“If we can get more fruits and vegetables into more mouths more often, that’s how we enter a category,” he said. “We’re very produce-centric, but we think we can move out from produce.”
“What we’re looking at could be deli-facing businesses or potentially, over time, dairy,” Dunn said. “The question is how to put fresh plus convenient together with innovative marketing and packaging, so you can do what bagged salads and beverages have done in creating higher-value products.”
“For a lot of people today, cooking is compiling,” he said. “Businesses like Blue Apron are shipping direct to the consumer with everything pre-cut and ready to cook. Value-added may be less about the packaging than how you put things together to create meals. Retailers are starting to do that.”
For all of its forays in beverage, salad dressing and fresh soup, Bolthouse’s biggest business and its priority remains fresh carrots. Growth possibilities exist there, too.
“The best ways to grow the commodity business are what we’ve partnered with (Produce Marketing Association) on,” said Dunn, a PMA board member and a leader of the Sesame Street Eat Brighter! campaign. “The launches of FNV and Sesame Street drive basic demand for fresh fruits and vegetables using more contemporary marketing and imagery, which the center-of-store guys have taken advantage of for a long time.”
Bolthouse gained fame and notoriety for its own nontraditional marketing, the Eat ‘Em Like Junk Food baby carrot branding campaign launched in 2010. It’s gone but not forgotten.
“That campaign is the grandfather of everything we do today,” Putman said. “It established a corridor for us to think about produce broadly, not just carrots.”
“Because we couldn’t get the broader carrot industry to participate financially, it was a tough thing to make work,” Dunn said. “If you’re spending all of the money to build demand and you’re capturing less than half of the business, the economics are just impossible.”
But insights gleaned from consumers during Eat ‘Em Like Junk Food inspired such ideas as chili and lime seasoned baby carrots.
Dunn, who once presided over The Coca-Cola Co.’s North America and Latin America business, is known for taking marketing cues from junk food and consumer packaged goods. It’s a direction he still favors.
“Absolutely, you can take the same marketing strategies and tactics and apply them to commodities and how the produce aisle is merchandised,” he said. “Don’t over CPG-ize it. You don’t want to make it feel like stack ‘em high, let ‘em fly. But you do want to create excitement, interest and engagement. That can happen a little more in produce than it does today. Retailers are figuring out how to create retail theater.”
“If you’re not marketing to customers and consumers you’re going backwards because everybody else is," Dunn said. “You’re fighting for share of stomach, share of wallet and share of mind ultimately. That’s the best way to build demand.”
A show business approach has limits as a way to move bulk vegetables or fruit, according to Dunn, but the rewards for innovative marketing of fresh produce are too great not to take risks.
“We’re making some progress in building basic demand, but there needs to be a lot more,” he said. “If people just ate what they’re supposed to in daily servings of fruits and vegetables, the industry would be three times bigger than it is today. It’s the biggest single business opportunity I’ve ever seen. The stores would need to be half produce. That’s a pretty compelling vision for what’s possible, but I don’t think we’re going to get there just by telling people to eat their vegetables.”