Read the Management Decision case in Chapter 8: Reaching Millennials through New Product Innovation at Campbell's Soup. Constant assessment of your market and target are essential in new product development.

• Develop a psychological and social profile of the Campbell Soup customer to include VALS framework and its relationship to segmentation and targeting.
  • How do segmentation strategies change based on your analysis?
• Defend Campbell's decisions in relation to the product life cycle and new product development.
  • In what way would strategies change based on the what stage Campbell's products are on the PLC?
• Examine the advantages and disadvantages of product expansion and new product development from Campbell's marketing perspective.
  • Which area would be most effective and why?

As part of a marketing team, in response to your peers, defend a positioning strategy for the product and market based on your peer's consumer profile and product expansion analysis.

MANAGEMENT DECISION CASE REACHING MILLENNIALS THROUGH NEW PRODUCT INNOVATION AT CAMPBELLS SOUP

What is a marketer to do when their whole product category is shrinking? Thats the situation Campbells Soup found itself in as many consumers decided that soup was no longer mmm mmm good.⁵³

Campbells Soup was a pioneer of mass food manufacturing, making shelf-stable (canned) goods a fixture in American pantries. But many of todays consumers prefer a different approach to eatingseasonal, fresh, and organic. This is particularly true for Americas 80 million millennials, an important generation that Campbells and other soup makers were not attracting to their traditional canned soup products. To reconnect with this market segment, new CEO Denise Morrison took the 125-year-old company in some bold new directions, using a combination of internally driven product innovation and acquisitions of food industry trailblazers.⁵⁴

Job one was to understand what millennials want in food. For this research, Morrison sent Campbells employees to cities known as hipster hubsAustin, Texas; Portland, Oregon; London; and Paristo learn about the preferences of these potential customers. This generation, they learned, is culturally diverse and globally connected. While they have college degrees, they also tend to be underemployed. This dine-out generation likes cuisines that were once considered exotic: Mexican, Indian, and Asian. Campbells vice president of consumer insights summed it up: They go through life hunting out and gathering different experiences. They sample foods in the same way they sample jobs. The Campbells team didnt just ask customers what they wantedthey used a process of deep immersion, which involved executives eating meals with customers in their homes, looking in their pantries, and tagging along on trips to the supermarket.⁵⁵

Campbells also wanted to predict where food tastes would be headed in the future. For this task, the company interviewed chefs, nutritionists, and academics, but also experts of a different sort: designers, anthropologists, and futurists. Campbells learned not only what consumers may soon be eating, but how they want to buy their food. Technologies such as augmented/virtual reality, artificial intelligence, and new kinds of currency will affect how food is purchasedboth through mobile devices and brick-and-mortar retail.⁵⁶

Acquisitions were one route Campbells took to add to its product line. Garden Fresh Gourmet was a health-focused brand with a loyal following for its salsa and hummus. Now a Campbells brand, it provides customers with gourmet soups in sizes to feed a whole family. Bolthouse Farms, a seller of fresh carrots and refrigerated beverages, brought additional expertise and customers. To reach millennial parents, Plum Organics was added, bringing with it a food line for babies and toddlers.⁵⁷

These acquisitions helped address another finding of the research: the high priority placed on healthy, fresh food. Consumers were concerned about the levels of sodium and high fructose corn syrup in Campbells traditional soups.⁵⁸ The trend toward a preference for organic food also influenced the companys innovation choices. Campbells launched an internally developed product, Go Soups, a premium-priced line of soups focused on freshness and packaged not in cans, but in plastic pouches designed to convey that freshness.⁵⁹ But Campbells has not kicked the can completely, offering its Well Yes! soups in a can, but without artificial ingredients. And Campbells Souplicity line uses high-pressure processing, allowing the product to retain its flavor and color without the use of preservatives.⁶⁰

This focus on health extends beyond products to education and a unique service offering. Campbells now offers a website and app, whatsinmyfood.com, that allows consumers to see details about the ingredients, where the food is sourced, and how its made.⁶¹ Even more revolutionary is its acquisition of Habit, a start-up providing personalized diet recommendations. Customers send an at-home nutrition test kit to a certified lab and then receive a personalized diet along

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with coaching from a nutritionist, all based on the consumers lifestyle, physiology, and health goals.⁶²

For a company accustomed to a few innovations each year, the new pace of product development is breathtakingin one year, they planned to introduce 200 new products.⁶³ Not all are hits: a kit to make soup in Keurig coffeemakers was abandoned due to disappointing sales.⁶⁴ However, to keep pace with the changing priorities of millennials and all its customers, Campbells will likely have to keep up this aggressive rate of innovation, using additional acquisitions and continuous R&D to roll out more products and services.