Pouches

US: Top food companies put new faith in pouch packaging

Campbell Soup and Heinz are among US packaged food companies leading the charge to alternative containers – thinking outside the bottle and can and increasingly partial to pouches.

Kitchen staples from Campbell Soup and Heinz will be joining other consumer products in pouches this year, reports The Chicago Tribune. 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, says 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 says.

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.

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.

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.

Campbells Soup in a pouchThis summer, the Camden, NJ-based company will launch Campbell’s Go Soup, a premium line with trendy flavours 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.”

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 HJ Heinz, 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 US, said CEO William 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 US 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.

Metal cans at the tipping point

In a recent Packaging Digest article, Mark Yunker, principal packaging engineer, Research, Quality and Innovation, for ConAgra Foods was quoted as saying: “There is a tremendous opportunity in developing cost-advantaged alternatives to the retorted metal can. ConAgra Foods processes more than five billion cans of food a year. We see the metal can at the same tipping point as the glass-to-plastic conversion was in the ’90s in the food industry.

“Plastic bottles were around far before the ’90s, but nobody had developed the equipment to produce the plastic bottle at a lower cost than glass. There were limited applications where CPGs were willing to fund the conversion, but it was based on product safety, not consumer preference. Companies didn’t really convert until the cost structure changed. Once it became a cost savings and the consumer benefit was an extra incentive, the plastic industry grew tremendously.

“We see this as another opportunity, but there is nobody really out there that’s developed the equipment that can form pouches and retort them at a lower cost than metal cans, or can produce a plastic package at a lower cost than a metal can.”

Other producers would appear to think differently.

Additional reading:

US: Campbell counts on soups-in-a-pouch to spur turnaround
Campbell Soup – which has put soup in see-through tubs and sipping cups – is now shoving it in a pouch as the marketer embraces innovations and new packaging in search of a turnaround.