KANSAS CITY — The ability to adapt has served Hostess Brands, LLC well during the coronavirus (COVID-19) pandemic.
“We historically were event-driven,” Andrew P. Callahan, president and chief executive officer, said during a virtual presentation at the Barclays Global Consumer Staples Conference on Sept. 10. “And now we’re usage occasion-driven.”
Hostess’ products, especially the sweet baked goods it is known for, traditionally have been marketed as a multipack offering for events: holidays, back-to-school, movie premieres. Consumers have been able to stock up on Twinkies and CupCakes in multipacks as a way to prepare for the aforementioned events.
In light of the pandemic, though, Hostess has shown the ability to adapt. Instead of massive promotions around specific events, the company has shifted its advertising and promotion to focus on eating at home and on-the-go convenience.
“A year ago, we had the biggest, largest back-to-school event we’ve ever had,” Mr. Callahan said. “We’ve smoothed out merchandising because … it’s more about being at home and a more family occasion.”
Another example is Hostess’ merchandising around Halloween. In the past, the company has had a strong limited-time-offering program tied to the trick-or-treating aspect of the holiday. This year, the strategy has shifted to bringing Halloween home.
“We’re accelerating where we’ve already been strong and retailers responded to that right away,” he said. “Now we have some channel mix, but retailers responded to that right away. So that usage trend is going to be very good for us, and we’re extending that thought.”
Looking ahead, Mr. Callahan outlined Hostess’ approach to Valentine’s Day and Easter.
“Valentine's may be less about being in the restaurant and more about how you entertain at home, Easter and spring holiday entertainment,” he said. “So it’s more of an ongoing every day versus big back-to-school events, and it’s changing the way we think. And we think that behavior and usage with consumers, which will be ongoing, is good for us. So the combination of that mobility, we think, puts us in a very good position.”