BOCA RATON, FLA. — J.M. Smucker Co. recently may have agreed to a major acquisition that will give it a strong foothold in the pet food business, but the Orrville, Ohio-based company remains committed to growing its U.S. retail consumer food segment, said Vince Byrd, president and chief operating officer.
In a Feb. 17 presentation at the Consumer Analyst Group of New York conference in Boca Raton, Mr. Byrd said the company has its sights set on growing both Jif and Smucker’s into $1 billion brands, and expects Uncrustables to approach $150 million in sales this year.
As the market leader in peanut butter, Smucker continues to leverage its strong brand and capability to drive growth with core items, while bringing new items to market, Mr. Byrd said.
“We are focusing on the growing preference for convenience and better nutrition,” he said. “To that end, we will be launching two new product lines — Jif Bars and Jif Peanut Powder — this summer. With more than 70% of households purchasing snack bars, we are leveraging our protein rich Jif peanut butter to capitalize on the nearly $5 billion and growing snack bar category.
“We are also excited to be the first national brand to enter the peanut powder category. While smaller, the category is growing rapidly and projected to more than double over the next three years. In addition, we are expanding our Jif hazelnut offerings to include a swirled spread, which infuses a sweet flavor with hazelnut, further capitalizing on the nearly $500 million and growing specialty spreads category.”
To help get the namesake Smucker’s brand to the $1 billion mark, Mr. Byrd said the company is extending the Smucker’s fruit equity to meet consumer preferences for a clean label and more natural offerings. New Fruit and Honey spreads are expected to provide consumers with an alternative through the inclusion of a natural sweetener, he said.
Earlier this year Smucker entered the $280 million fruit pouch category with the launch of Smucker’s fruit bowls, and Mr. Byrd remains optimistic about the product’s potential.
“We are excited to expand this line to include two unique flavorings of fruit and grains,” he said. “These type of pouches are growing faster than the fruit-only pouches, and we are pleased to provide these new offerings to our customers.”
Smucker also is bringing innovation to its Uncrustables line of frozen sandwiches with the introduction of a chocolate hazelnut variety.
“We estimate total sales for our Uncrustables to reach nearly $150 million this year as we have experienced 12 consecutive quarters of double-digit growth of sales and volume in the U.S. retail,” Mr. Byrd said. “We will continue to expand our offerings and distribution, which includes re-entering the U.S.D.A. school program where we look to regain the previously exited school distribution.”
Mr. Byrd also took the time to brief CAGNY attendees on some innovation in the U.S. retail coffee category. He said the company will begin converting its core Folgers items to a smaller canister in the second quarter of fiscal 2016, a move designed to provide “lower price points without compromising quality” while improving the company’s “competitive positioning in our mainstream roast and ground business.”
He also announced the initial launch of Folgers Perfect Measures in select markets.
“This breakthrough innovation consists of 100% roast and ground coffee in premeasured tablets with no additives providing consumers with a convenient no mess solution,” he said. “With traditional roast and ground coffee machines accounting for three out of every four machines sold, Perfect Measures will provide consumers who prefer a brewed pot of coffee with a more convenient and sustainable solution.”
Earlier this year, Smucker looked to capitalize on the demand for variety and convenience with the debut of Folgers Flavors. Mr. Byrd said initial retailer response has been “very strong,” and the company is adding to the platform with the launch of Folgers Iced Cafe, a new offering that contains pure coffee, sweetener and flavoring.
“We are excited about the potential for these on-the-go solutions that support the desire for a personalized coffee experience,” he said. “As we move forward, we expect premium coffee and K-cups to remain key growth drivers for the overall category and we are well-positioned to compete.”
J.M. Smucker co. announced its planned pet food acquisition earlier this year. The company on Feb. 3 said it had entered into a definitive agreement to acquire Big Heart Pet Brands in a cash and stock transaction valued at approximately $5.8 billion, which includes about $2.6 billion of net debt.
