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why

Our Purpose — Real food that matters for life’s moments — guides how we think about nutrition and health. It is our North Star amidst today’s dramatically shifting food landscape. As a key voice in the food industry, we must ensure that our products are relevant and meet the expectations of our nutrition-savvy consumers, who are increasingly demanding healthier and fresher food with minimal artificial ingredients and processing.

It is imperative for Campbell to stay abreast of changes in food and nutrition to better understand how we can provide our customers with the healthy food they desire and thus identify the opportunities we have for growth. In 2015, the food world continued to shift in unprecedented ways. These changes are reshaping the way food is grown, made, marketed, sold and consumed. In turn, an evolving food and nutrition landscape is fundamentally altering the way we think, talk and act about our products. We know that if we don’t evolve with these trends, we will not be able to thrive as a food company. Some of the trends influencing our food and nutrition strategy are:

Rise in Chronic Diseases

According to the 2015-2020 Dietary Guidelines for Americans, rates of chronic diseases related to poor-quality diet and physical inactivity have increased, with half of all U.S. adults having one or more preventable, diet-related chronic diseases, including cardiovascular disease, type 2 diabetes, and overweight and obesity.

Heightened Consumer Interest in Fresh and Healthy Foods

Consumer interest in health and wellness is growing as they recognize the role diet plays in health and well-being. They are demanding healthier, more “real foods,” which we define as foods with fewer artificial ingredients and minimal processing. Consumers are increasingly seeking fresh, natural, organic products and those made with ingredients they recognize. They are telling us to avoid artificial preservatives, colors and flavors and are seeking products with vegetables, whole grains and other components associated with good health.

Intersection of Health and Technology

We refer to the increased fusion of health and technology as society becoming “wired for well-being,” and it will have a profound impact on consumers’ food choices. People will soon make decisions about what to eat or what not to eat based on individual needs. Consumers are already leading “quantified lives” — tracking their activities and fitness through “wearables” that measure aspects of their overall health. The emerging trend in this area is bio-monitoring. We’re seeing it in health care and medicine, and it is only a matter of time before it impacts the food industry. In the future, consumers will no longer wonder about the “right food” for them because bio-sensors will scan their metabolism and recommend the “right” diets.

Our consumers are also increasingly using digital tools to shop and share their opinions about food. People love to socialize about the food they cook, shop for and eat. They take photos of their food and share, like and comment on their friends’ experiences through social media. This creates interesting opportunities for Campbell that we’re actively exploring.

Consumer Demand for Greater Transparency

Consumers today are savvy and have greater expectations of food companies to disclose how and where their food is made, which ingredients are used and how those ingredients are produced and sourced. In its 2015 Global Annual Review, PWC cited food integrity and transparency as one of four colliding megatrends, noting: “High profile contamination, adulteration and fraud incidents in the US, Europe and Asia have eroded public trust in the food industry, raising consumer awareness of food quality and ensuing safety risks. There is growing demand for higher quality food and transparency of food ingredients, origins and production processes, especially among the world’s growing urban middle class.”

how

Consumer demand and these evolving food trends, along with an industry call for greater transparency, were key drivers behind our decision to take a step back and give our nutrition strategy a refresh. In FY2015, we outlined our new corporate Strategic Imperatives, which included expanding our business in the areas of fresh and well-being. To help meet our new Strategic Imperatives, we implemented a major restructuring of the company. By reorganizing our business to prioritize food categories rather than regions, health and well-being became even more embedded into our products and overall corporate responsibility strategy. We will continue to accelerate growth in our Campbell Fresh division and expand into new categories in the packaged fresh category, as evidenced by our recent acquisition of Garden Fresh Gourmet.

We aspire, with this new approach, to make Campbell even more synonymous with real and better-for-you foods in the future. Moving forward, Campbell will continue to evolve its health and wellness strategies and policies to reflect these consumer demands. Currently, we are doing this by:

  • measuring our progress;
  • expanding our healthy product portfolio; and
  • engaging and educating our consumers.
what

In order to ensure that our products reflect the latest nutrition findings and consumer demands, we lean on the expertise of our nutrition and health stakeholders and partners to find better-for-you product solutions. We are constantly seeking ways to improve the nutritional value of our food and beverages so that we can, in turn, help people improve their diets and meet their personal health goals. To do this, Campbell seeks to reduce the nutrients or ingredients of concern in our products such as saturated fats, sodium, sugar and artificial ingredients. At the same time, we pursue positive nutrition by increasing vegetables, whole grains, and other food components or nutrients underconsumed in the diet.

Measuring Progress

We know that this is a journey, and we must set goals and make progress against them each year. Since 2010, we’ve measured our progress by making continuous improvements in the sales of better-for-you products. To track our progress against these goals, we evaluate the nutrition of our products against government and other scientifically accepted criteria, and in FY2015, expanded this assessment to include our global product portfolio.

CRITERIA PROGRESS
Government criteria for “healthy” foods $2.9 billion, or 29 percent, of total gross sales of foods met the definition of “healthy,” defined as those foods with nutritional profiles satisfying the FDA and other globally accepted criteria for our entire global portfolio. This is an approximate $215 million, or 8.6 percent, increase over FY2014 in the U.S and includes an additional $205 million in international sales.
Efforts to reduce or limit nutrients that, in excess, may contribute to negative health outcomes. $5.4 billion, or 53 percent, of total gross sales were generated by products brought to market that are lower in calories, saturated fat, trans fats, sodium and/or total sugars.
The contribution of our foods to a healthful diet through the provision of food groups or nutrients that are underconsumed in the diet $3.2 billion, or 32 percent, of total gross sales of consumer products globally that make a positive contribution to the diet through servings of fruits and vegetables or are a good source of fiber, vitamins, or minerals. This is a $259 million, or 9.7 percent, increase in the U.S. with an additional $275 million coming from international sales.

Offering a Portfolio of Healthy Options

Campbell believes that consumers should have options from which to choose, especially when it comes to better-for-you products. We are committed to promoting and encouraging healthy eating by creating products that are not only nutritious, but affordable, and meet the local and regional tastes and customs of our diverse customer base.

In FY2015, we brought consumers even more variety to the grocery store shelf by:

  • Expanding our organic offerings;
  • Building out our lean, lower-calorie, no added sugar, no artificial ingredient and “light” product lines;
  • Launching two new varieties of Goldfish Snacks that contain 12 g or more of whole grains per serving;
  • Growing our fresh division with the acquisition of Garden Fresh Gourmet; and
  • Simplifying our recipes to remove ingredients that our consumers do not want.

FY2015 Product Nutrition Highlights by Market

Several new varieties of our SpaghettiOs brand of canned pasta included new microwaveable pasta trays that meet FDA criteria for a healthy main dish.

Consumers looking for better-for-you soup options can now choose from several new lower-calorie Homestyle Light soups, as well as Swanson Unsalted Chicken and Beef Broths and Swanson seasoned canned Turkey and Chicken varieties that meet lean and Heart Healthy standards.

New healthy Prego Italian sauce varieties include Florentine Spinach & Cheese, Red Pepper & Parmesan and Merlot Marinara Italian sauces. We also introduced a light Prego Alfredo sauce.

New V8 Vegetable and Fruit Juice beverage varieties Healthy Greens, Purple Power, Golden Goodness and Carrot Mango have no added sugar or artificial ingredients and are 60 calories or less.

We introduced two new Vita-Weat products made with a selection of seeds and whole grains known for their dense concentration of nutrients, adding to Vita-Weat’s already impressive nutritional benefits. In addition, Vita-Weat Ancient Grains & Seeds with quinoa and chia and Vita-Weat Five Super Seeds with chia and flaxseed are good sources of omega-3 and fiber.

Campbell’s Simply Soup, launched during FY2015, offers up to four servings of vegetables per 500 g pack.

V8 Power Blends offer two servings of vegetables in every 250 mg. The juices also provide a source of the powerful antioxidant Vitamin C and contain no added preservatives or sugar and no artificial flavors or colors.

Revitalized our Campbell’s ready-to-serve soup lineup, providing consumers with a choice of sodium levels to meet their needs.

Added a Homestyle Rustic Lentil soup high in fibre with less than 480 mg of sodium per serving.

Engaging and Educating Our Consumers

We believe we have a responsibility to engage and inform our consumers about health and nutrition as it relates to our products so they can make food decisions that are good for their health and the well-being of their families. To help them make informed decisions, we present our consumers with a variety of tools and resources — on-package, online and through other communication channels.

Most importantly, when a product is in hand, we ensure that the item contains simple language or obvious markers to help consumers identify health criteria. Consumers can also feel confident that any health claim made on the label is backed by stringent criteria developed by third-party experts. For instance, all of our products claiming to be “healthy” are required to meet the FDA nutritional criteria.

In 2015, we continued to engage with consumers in a number of ways to empower them with nutritional know-how and meal planning, including:

  • A weekly Meal-Mail newsletter electronically delivers meal ideas and recipes to more than 650,000 busy U.S. customers.
  • Campbell’s Kitchen website (www.campbellskitchen.com) offers consumers quick, easy, delicious recipes along with timesaving tips and coupon savings.
  • Cook with Campbell’s website (www.cookwithcampbells.ca) connects on-the-go Canadian consumers with simple meal planning and preparation ideas. They also offer a monthly Meal-Mail with recipes for consumers.
  • Ideas for Innovation website (www.campbellideas.com) gives employees, consumers, customers, suppliers, contractors, inventors and friends the opportunity to share their ideas with us, including how to improve the health and nutrition of our products.
  • Campbell’s Online Nutrition Portal (www.campbellnutrition.com) offers consumers the inside scoop on the nutritional attributes of our products, and helps consumers make choices that align with the 2015 Dietary Guidelines for Americans. Consumers are able to search Campbell offerings by beneficial nutrients, dietary restrictions, nutritional needs and by brand or product name.

We also always welcome the feedback of our consumers, and our Consumer Affairs team reviews and addresses all inquiries, whether it is through our surveys, toll-free telephone number, letters, emails, social media engagement using @CampbellCares or our “Chat with Us” feature on our corporate website.

Changing Recipes for the Better

In FY2015, based on feedback from parents, we simplified the recipes of our existing Campbell’s Condensed kids’ soups and removed MSG, while continuing to make the soups without artificial preservatives, colors or flavors. Currently, 98 percent of our portfolio is free of artificial or added preservatives, colors and flavors. We also announced plans to eliminate the use of artificial colors and flavors in our North American portfolio by the end of FY2018. Additionally, we created the NO GO list: NO artificial flavors or colors; NO added preservatives; and NO MSG. These ingredients will not be used in any new product we are creating in the Americas Division and we will continue to look for ways to reduce our use of high fructose corn syrup.

Extending Our Fresh Options

We continue to grow our better-for-you portfolio through strategic acquisitions. In 2015 we acquired Garden Fresh Gourmet, another milestone in our efforts to increase our presence and sales in the packaged fresh category. Garden Fresh Gourmet makes the number-one branded refrigerated salsa in the U.S., along with hummus, dips and tortilla chips. This acquisition is another milestone in reshaping our portfolio toward faster-growing categories. Garden Fresh Gourmet’s on-trend products will allow the Campbell Fresh division to expand in the deli section of the grocery store perimeter and will complement our strong presence in the produce section.

This is the latest in a series of moves we have made in response to increased consumer interest in fresh foods and health and well-being, first with the acquisition of Bolthouse Farms followed by the acquisition of Plum. Garden Fresh Gourmet is part of the Campbell Fresh division, which leverages the Bolthouse Farms refrigerated platform. Packaged fresh foods represent a $19+ billion category that grew 4.9 percent in the past year, above the industry average.

Organic Gets the Spotlight

Organic eating is a priority for many Americans, and we want to make sure that those who choose to eat organic — no matter where they live — have options that are both authentic and delicious. We live in a food culture where consumers are increasingly seeking foods that are made with simple, natural and organic ingredients. According to the Organic Trade Association, 81 percent of U.S. families already choose organic foods at least some of the time, and more than half of consumers ages 18 to 29 are actively trying to include organic foods in their diet.

To meet this growing demand, we increased our organic offerings with line extensions in our core portfolio. In early 2015, we launched Campbell’s Organic, a line of six premium, ready-to-eat soups, which includes vegetarian and gluten-free varieties. Building off this momentum, we also introduced three organic kids’ soups, Mega Noodle, Chicken and Stars and Disney Princess Frozen. These soups are non-GMO and use ingredients sourced from certified American Organic farms. We also expanded the Plum line of organic food for babies, tots and kids, launching 29 new organic meals and snacks in the U.S. and expanding the brand to Canada.