Packaged food makers are thinking outside the bottle and can. More to the point, they're increasingly partial to pouches.
Kitchen staples fromCampbell Soup Co. andH.J. Heinz Co. will be joining other consumer products in pouches this year. The trend is being driven by savings on packaging and shipping costs as well as aesthetics — an upscale pouch sporting elaborate graphics offers a modern look and premium appeal, marketers say.
John Kalkowski, editorial director of Packaging Digest, said pouches also are becoming more prevalent because technology has improved, doubling average shelf life from one year to two.
Manufacturers can cut packaging costs 10 to 15 percent by going to the pouch, he said.
Overall pouch use in consumer products, including shampoo and pet food, has increased 37 percent since 2007, according to Mintel Group, with particular growth in snack pouches.
For Campbell, the move is part of a battle for credibility with millennials, ages about 18 to 34, who tend to associate its iconic red-and-white cans with grandma's house.
This summer, the Camden, N.J.-based company will launch Campbell's Go Soup, a premium line with trendy flavors like coconut curry with chicken and shiitake mushrooms. Go Soup comes in an edgy, graphically intense pouch with funky fonts and pictures of young people making quirky faces, seeming to enjoy the soup. Informal notes at the bottom try to eliminate confusion about the product, like "shiitake happens, but this soup is ready to eat."
A company spokesman said Campbell has yet to set prices on the new soups.
The soup giant is looking to turn its primary business around after years of volume declines.
While officials said Campbell's first goal is to support its iconic can, the company is looking to baby boomers' children as they're starting to set up households, and making a big bet on pouches to get their attention.
"We want to fire some bullets and if they become cannonballs, we'll put our money down," said Campbell's CEO Denise Morrison. "It's a different approach for us, but we're going to listen to consumers, we're going to develop the products that they want, but then they need to buy them."
Morrison said Campbell's is outsourcing pouch production to a third party until sales are strong enough to warrant the investment of bringing production in-house.
The company also will launch a line of skillet sauces in pouches this fall, designed to make dishes like shrimp scampi or Thai green curry chicken easy when the right protein and starch are already on hand.
Charles Villa, vice president of the consumer and customer insights department for Campbell's USA, said pouches have broad appeal to consumers, particularly those under 35.
"They see the pouch as a very contemporary packaging alternative and they relate that packaging to a better quality experience coming from the food that's in (it)," Villa said, adding that they expect "a better quality experience for the food" and even a "fresher" product.
For the H.J. Heinz Co., however, a flexible pouch is being used to introduce a smaller size of its namesake ketchup. With a squeezable pouch and nozzle, the 10-ounce product will sell for 99 cents, compared with $1.99 for a 20-ounce bottle.
The typical shopper in a developed market like the U.S., said CEO William R. Johnson, "is now intensely focused on value," adding that buying decisions are based more on price "and less about product design."
In this environment, the world's largest ketchup company has been looking for ways to maintain dominance as families look for food bargains at discount grocery retailers such as Aldi and Save-a-Lot and even dollar stores. With the pouch's lower price, Heinz is hoping to give budget-minded families a reason to buy its product rather than a private-label offering.
Johnson said the company is optimistic about the pouches, given evidence that U.S. shoppers are looking for smaller sizes, and the success Heinz has had with pouched sauces and other products, like baby food, in developing markets like Russia, Costa Rica, Mexico and Brazil. Both Heinz and Campbell declined to comment on any savings associated with pouches.
While pouches have been prominent in Europe and Central and South America for five years or more, they're just beginning to gain traction in the United States, which is notoriously slow in adapting to packaging trends, said Lynn Dornblaser, director of consumer packaged goods insights at Mintel. In Europe, she said, consumers are accustomed to buying milk in pouches too.
The trend got going in 2007, with more snacks popping up in pouches, Dornblaser said. She pointed to the arrival of StarKist tuna in pouches in 1999 as disruptive innovation in the tuna section. But because the pouch was a novelty here, it took time to get the StarKist business off the ground.
Jennifer Albert, director of marketing at StarKist, said the pouch business took about five or six years to be self-sustaining. While it's now a solid success story for the company, she said there are still consumers who are either unaware of the pouch or haven't thought about the convenience of keeping pouches in a desk drawer for lunch at work.
Albert said seeing more products in pouches now is "exciting." "It took over 10 years to get people to accept it and now other big brands are going there," she said, pointing to Campbell and Gatorade, which uses a pouch for its G Series and G Series Pro. "It makes you feel good," she said.
Dornblaser said the latest wave of pouch conversions appears to be about "providing creative consumer solutions," as opposed to simply introducing a new package because technology was available, as StarKist did with the tuna pouch.
Heinz, she said, is working with consumers who need to save money, and is fighting off private labels in the process. Campbell, she said "has been really pushed by its competitors" and needs to offer something new. She expects to see more nonfood items in pouches in the future. "We'll begin to see more refills in home cleaning products," she said. "And also we'll begin to see more refills in personal care like shampoo."
