When 12-year-old Henry John Heinz puttered in his backyard garden, he saw the future, and its name was ketchup.
How appropriate that children are his company’s No. 1 target consumer. Added to the company’s condiment offerings in 1876, Heinz ketchup has seen the kind of growth all small companies with big dreams imagine.
Under the leadership of William Johnson, the company’s sixth CEO in its 128-year history, Heinz’s earnings per share increased 11.5 percent in the first quarter of 2000 and ketchup sales were close to $593 million in the quarter ending Aug. 2. In a prepared statement, Johnson said this has been “the most innovative period in Heinz’s recent history,” a period which included the launch of Heinz EZ Squirt Ketchup.
Heinz was an innovator and believed that people and good quality are at the heart of any successful business — a credo the company still follows today. Said Heinz.: “Quality is to a product what character is to a man.”
Later Heinz CEOs applied this statement to environmental concerns, and in 1990, Heinz USA introduced the first fully recyclable ketchup bottle.
According to its Web site, Heinz will sell 650 million bottles of ketchup this year. Ketchup is consumed in 140 countries, and recent trends show consumption is growing, with Heinz’s market share at an all-time high due in part to the new trap-cap and a new pricing strategy.
And with the recent acquisition of PT Heinz ABC (Indonesia), the world’s largest soy sauce company and maker of an Asian ketchup, the popularity of Heinz ketchup is sure to continue, especially if Brendan Foley, Heinz general manager of ketchup, condiments and sauces, has anything to do with it.
With such popularity worldwide, why would Heinz tweak, let alone change, anything about its ketchup? Why would it mess with a branding success story more than a century old?
According to Foley, innovation, persistent attention to customer needs and supportive upper management are keys to growing any product or service. SBN recently caught up with him to discuss the importance of innovation when it comes to building and reinforcing your brand.
Here’s what he said.
SBN: For a global company with a brand as popular and well known as Heinz ketchup, why is it important to continually change the packaging and create new interest in the product? Why not just rely on its long-standing popularity and the public’s familiarity with the Heinz name?
Foley: Look at the environment we’re in today. I’m not sure it really matters what brands you work on. When you try to grow, you continually have to innovate. Heinz stands for the definitive taste of ketchup, so we can’t rest on our laurels. In the case of Heinz EZ Squirt, it’s the perfect example of staying close to who our consumers are.
Our No. 1 customers are kids; they use a lot of ketchup. This doesn’t mean changing the taste. It means addressing certain issues like the watery stuff that comes out of the bottle. It’s a natural thing, but it’s a real bummer when it drips onto your hamburger bun.
That’s unacceptable if you’re going to be the best ketchup. It’s those little things that reinforce why we have a presence with consumers.
What’s the story with the green ketchup?
Kids love this idea, and I bet it’ll strike the curiosity of a few adults, too. We recognized that kids are our No. 1 consumer. When we looked for growth areas, we felt one promising area was to spend a lot of time researching kids in their homes — in focus groups — and find out what they like and don’t like about ketchup.
We developed a package that allows kids to squirt ketchup exactly where they want. We designed the bottle to be easier to hold, and a special cap squirts ketchup out in a thinner stream. Kids understood that because fundamentally, ketchup provides for kids a lot of control.
Very few products allow kids to have control. They can decide, “I’m putting ketchup on my broccoli” and make the meal taste and look the way they want it to.
Kids told us to make it a different color, that it would enhance the experience of using ketchup. Color elevated overall what was great about ketchup in the first place. And with kids eating so much ketchup, we made mom feel better, too, by fortifying the product with vitamin C.
What is Heinz’s general branding philosophy?
Understanding what it is about consumers that make them like the product. A brand like Heinz is very broad-shouldered; it stands for quality, fresh ingredients.
We’ve redefined at times but it’s still mainly the same today. From a brand management standpoint, we value the Heinz name and take responsibility for the products. We have to grow and nurture them; it’s a never-ending task. But consumers and retailers expect that from us.
This is not unusual behavior. From terrific ads, packaging innovation, going to squeeze bottles — Heinz has always done this.
What lessons can businesses learn from this philosophy?
Know your customer better than anybody else. It doesn’t matter if you’re an international or local company. Forget the size of the business or how common the product.
Provide the best product or service, and don’t stop there. Pay attention to detail; deliver on the customer’s needs better than anybody else, and don’t stop. Go for organic growth — selling more cases now than you sold last year. It may seem simple, but it’s true.
We’re supported by the leadership of the company and encouraged and challenged to do more of this. How to reach: Heinz,www.heinz.com.
Amanda Lynch is a free-lance writer for SBN.
