The future includes avocado sauces, fermented foods and anti-oxidant lemonade, according to Kraft Heinz, the owner of the world’s most famous ketchup brand.
Kraft Heinz has launched its Springboard programme to partner with innovative companies that are disrupting food and drink markets. These partnerships will help exciting new products hit supermarket shelves sooner. But are these safe bets, or is Kraft Heinz playing a game of hipster buzzword bingo in the hopes that one of the new products will hit it big?
Success only appears obvious in hindsight, especially when it comes to new food and drink products. Very few predicted that coconut water, kale or quinoa would become commonplace with consumers. But with the right bets, Kraft Heinz can look like a genius five years down the line, with naysayers forced to eat their words (and the delicious new products they said would never work).
Kraft Heinz has joined companies like PepsiCo, Coca-Cola and General Mills in setting up incubators to foster the growth of disruptive products. The first five companies in Kraft Heinz’s incubator were announced on Monday. Will these five companies succeed, or are they targeting hipster fads doomed to fading away when consumer tastes move on?
Ayoba-Yo Meat Snacks stands out as Kraft Heinz’s strongest bet. Consumers continue to snack frequently; making snacking markets a good bet for investors. Consumers are also looking for healthier alternatives to chocolate and potato-based snacks. Meat snacks also match well with lots of different spices, appealing to adventurous consumers. However meat snacks remain a small market; worldwide they rarely account for more than 10% of savoury snack sales. This investment could make Kraft Heinz a big fish, but only in a small pond.
The other four investments are closer to a game of hipster buzzword bingo. Cleveland Kraut fermented food, Kumana avocado-based sauces, Poppilu antioxidant lemonade and Quevos egg-white snacks are all on-trend. They target popular health needs and flavour trends, and are strongly differentiated from current offerings in these markets.
However these four products target trends that are fleeting. Many feel that we have reached ‘peak avocado’, fermented foods and egg-white snacks might be too unusual to resonate with a mass market audience, and selling health claims in lemonade is challenging, with drinks struggling to overcome perceptions of being either too high in sugar or full of artificial sweeteners.
Kraft Heinz is taking the right steps in partnering with disruptive brands, learning from their innovations and giving them a strong position to leverage should these brands achieve explosive growth. Springboard offers a 16-week programme, ensuring the company can rapidly rotate brands and increase the chance of finding a big win.