By Paul Talbot
From Oscar Meyer to Ore-Ida, Kraft Heinz has been the steward of leading brands for generations. I recently asked CEO Miguel Patricio to explain what’s changing at the firm and why.
Paul Talbot: What sort of changes will you bring to Kraft Heinz marketing?
Miguel Patricio: We have to build a culture of creativity. I will encourage people to take risks, not small ones around the margins, but meaningful ones.
The importance of building this culture cannot be overstated. It will allow Kraft Heinz to be ahead of its time, and to position itself as a leader in the consumer packaged goods industry. Creativity is crucial to understanding and anticipating the future. Take the example of new parents who grew up on Kraft Mac and Cheese. They have a nostalgia for this product, which is a powerful advantage for our company.
A culture of creativity understands their needs and their lives, but it also anticipates how Kraft Mac and Cheese will fit in the lives of their children as they grow to become teenagers, young adults and perhaps think about becoming parents themselves. Kraft Mac and Cheese is a link between these generations, but this does not mean it can remain static. For it to remain an important part of consumers’ lives, it has to evolve with every generation, with innovation that is effective and incremental.
Talbot: What strategic process is most effective in reinvigorating a brand that might be considered, in your words, ‘a little bit dusty?’
Patricio: I’d like to use the fact that many of our brands have been around for generations to our advantage. Nostalgia is powerful among all age groups, but in particular among younger generations. We have brands that stand the test of time and enjoy vast name recognition. Now it’s a matter of making them move.
I love the example of Planters Cheez Balls and Cheez Curls, two snacks that are synonymous with the ‘90s. We responded to die-hard fans and last year we brought them back, reinforced with a robust marketing strategy. The response was tremendous and underscored the strong value of the brands in our portfolio.
I’m also focused on premiumization. We win by demonstrating to consumers that our products are the highest quality, have the best taste, and offer the best fit in their busy lives. This approach works. I’ve seen it happen time and time again during my years in global marketing – and it’s happening now at Kraft Heinz.
Let me give you two other examples of success that show what happens when we invest behind our brands, drive innovation, and move into new retail categories. Heinz Tomato Ketchup recently reached an all-time high U.S. market share, topping 70%. And Philadelphia Cream Cheese has had consistent share growth since 2014, and currently holds 68% market share.
Talbot: When the quality of an organization’s marketing strategy is evaluated, what key factors should be taken into consideration?
Patricio: Key factors are uniqueness, meaningfulness, along with the potential to generate incremental sales and to increase household penetration. To do all this in our current moment of fragmented media is a difficult task, to say the least. We have to use all the tools at our disposal to cut through the clutter. We need to deliver moments of clarity about our products.
How do we do this? By building a culture of creativity.
Talbot: How should marketing strategy, which has a tendency to become unwieldy, be created and managed so it’s focused and effective?
Patricio: A long-term perspective is crucial. It guides daily spend, daily planning and innovation. It lets us find efficiencies in our marketing strategies. But most importantly, it helps us clarify which decisions are the right ones and what kind of bets we should make.
If a specific marketing strategy will provide short-term gain but doesn’t contribute substantially to our brands’ long-term plans, then it’s not worth doing. Let me also add that there are so many competing pressures for our marketing budget. At the core, however, our spend should be focused on reaching the consumer, not on all the other places that go into the marketing back-office.
Our goal is to spend our marketing dollars more effectively so that we can invest more into directly reaching consumers.
Talbot: Any other insights you’d like to share?
Patricio: I’ve been CEO for less than two months. It’s a thrilling and humbling opportunity to lead this world-class company into its next phase of growth, and to become the steward of our many iconic brands. I’m so energized by the opportunities here.
Every weekend, I can’t wait until Monday comes around! Often, I’m asked what has surprised me the most as I begin my time here as CEO. It’s the quality and talent of our people, which is why I’m so intent on building a culture of creativity. I want to celebrate and nurture this creative talent, and I want to send a clear message: it’s OK to take risks.
Feature Image Credit: Getty Images