As much of the world sat at home in lockdowns to prevent the spread of coronavirus, millions of consumers rekindled an old flame.
"Many consumers have returned to some of those pantry staples that we've had in our portfolio during this pandemic, and it's reminding them of their love for a lot of the Kraft Heinz brands," Christopher Urban, Kraft Heinz's vice president of global strategic capabilities, said at a virtual licensing conference on Monday. "And we see this in our data. We've seen significant increases in household penetration across many of our brands over the past few months. In some cases on some of the brands, we are seeing record high numbers. And I think this increase in household penetration just makes the brands even more relevant to the consumer."
Urban spoke at the Licensing Week Virtual conference about the opportunities the food company has available and is pursuing, many through the agreement signed last year with Brand Central. Kraft Heinz, which owns scores of well-known and globally beloved brands, entered the Brand Central agreement to transform its megabrands Heinz, Kool-Aid, Planters, Jet-Puffed, Oscar Meyer, Philadelphia, Kraft Macaroni and Cheese and Velveeta into lifestyle brands. The company wants to make consumers think beyond the iconic food when they think of these brands, and Urban said these nine were considered the best for consumer buzz among merchandise and other food channels.
The pandemic and increasing consumer affinity for long-beloved brands, Urban said, has helped move this effort forward. Consumers becoming renewed fans of products make them more excited to expand those items and branding beyond the kitchen — to clothing, household items and online experiences.
"Our brands have been in our lives for a long time, and people have a really strong love and affinity with many of our brands," Urban said. "And that's where opportunities are really endless. It's been fun to think about where we want to go with the brand, and also see where partners pick up brands to go."
Though a lot of the licensing pursued through Brand Central is for non-food merchandise, Urban said that Kraft Heinz is extremely open to licensing for food products as well. Using the trend of iconic-flavored sweets, Urban said they were able to create Kool-Aid branded gummies, cotton candy and pop candy. And more is likely coming down the pike. Urban mentioned Kraft's well-known blue box Macaroni & Cheese.
"That's got an iconic flavor profile, and we've been in a lot of interesting conversations with some folks about how do we extend that flavor profile into other food categories," he said.
Some of the best conversations about extending their food, Urban said, are with companies that want to get the taste into food categories Kraft Heinz does not specialize in, like salty snacks.
The biggest thing that Kraft Heinz is looking out for when considering brand extensions is whether they make sense for the brands. The company has been building some of its brands for more than a century, Urban said. It knows where it wants its brands to go — as well as directions it does not want. Everything that has Kraft Heinz's name on it needs to meet the same high standards that the company has set for itself since the beginning.
This doesn't mean there's no room for creativity, but that it is important that the guardrails to new ideas and extension are firmly in place. Through Kraft Heinz's deal with Brand Central, Urban said the firm helps find partners who can develop the kinds of licensed items that consumers want.
But while the licensing agreement with Brand Central is focused on nine big brands, Urban said the company is taking advantage of some of the popular '80s and '90s nostalgia. Brands including Shake 'N Bake, Cool Whip and Stove Top are seeing bumps, and Kraft Heinz has been looking at ways to extend that affinity. Urban said there are merchandise opportunities for some of these brands.
Urban said the pandemic is a cultural moment that is forcing shifts in consumer behavior. It's changing shopping patterns and methods, what consumers are eating and drinking, and how people go about their daily lives. And some of it is bound to stick. Brand extensions and good marketing are helping that new bond between Kraft Heinz and consumers stronger, he said.
"We've seen them [consumers] come back to our products and really be surprised and delighted, ... so we think that will pay long-term benefits to us as an organization," he said.
Correction: In a previous version of this article, the types of companies Urban considers to have the best conversations about food extensions with was misidentified. Those companies make salty snacks.
