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Mealpreparerstodayhaveewercookingskills,onaverageknowinghowtopreparejustvebasicmeals.Thesemealsareotenrotatedovertheweek
leadingtomealboredom
Twoincomehouseholdswherebothhouseholdersareworkingmeanthereislesstimeormealpreparation.Mostmealpreparersareunwillingtospend
morethan30minutesonmealpreparation(at4p.m.,70percentooodpreparershavenotyetplannedthateveningsmeal)
Mealpreparersnowwanttoassembleamealusingourtovepartially
pre-preparedingredientsratherthanstartingromscratch.
InsightsgainedromthistypeoresearchallowcompanieslikeHeinzWatties
todeterminebothproduct innovationandcommunicationstrategies,aswewillnowsee.
5 Productinnovation
InnovationisattheheartoWattiesgrowthandsuccess.HeinzWattiesacceptsthatevencompanieswithrecognisablebrandsandhighcustomerloyalty
mustinvestandadapttomeetnewcustomerexpectations.Itisenergisedto
identiyandexploitnewuntappedmarketsaheadoitscompetitors.Butevenproductssuchasbakedbeansandtomatosaucethathavebeenamainstay
orgenerationsoshoppers,canattractnewcustomerswhenpresentedin
newways.ExamplesareIndianandBostonstylebakedbeans,marketedas
BeanThereBeans.Inthisway,HeinzWattiesislookingtokeepproductsresh,appealingandrelevanttoconsumersaswellasosettingcompetitors
encroachmentonitsmarketshare.
Moreimportantly,perhaps,itsteamoches,oodtechnologists,researchers
andpackagedesigners,plusexpertsinnutritionandqualityassurance,isconstantlyndingnewwaystokeepupwithnewproducts,betternutrition,
bettertasteandconsumervalue.RecentexamplesincludeWattiesToasties,
WattiesSteamFreshvegetablesandmeals,pouchmealssuchasready-to-serveTortelliniandevensimpleinnovationslikeWattiesFruitSquirtzthatare
ruitpureinasingle-servepouchormat.
ToastiesutiliseNewZealanddevelopedandpatentedtechnologytosealthe
toastedsandwiches,buttherenementothisprocessinvolvedmanymonthso
trialanderrortocreateaproductwithhome-madetastethatcanbecookedinanuprightkitchentoaster.
BoththeSteamFreshandTortelliniproductsalsomeetthegrowingneedor
ultra-convenientoods,butneitherotheserangescouldaordtocompromiseonfavour.HenceallvegetablesusedinWattiesSteamFreshproductsare
pickedattheoptimumtimeandsnaprozen,otenwithintwohoursopickingto
ensurereshnessandtaste.FortheTortellinirange,recipedevelopmenttookmanymonthsandincluded
multiplestagesoconsumerresearchtohelpdirectdevelopmentothecomplexfavourprolesthatnowexist.BothrangeshavenowbeenexportedtoAustralia
anditisachallengetokeepupwithdemand.
ThisyearHeinzWattieshasalsointroducedarangeosoupsandmealsin
microwaveablebowls.AlthoughthesouprecipesweredevelopedbyaKiwi
orKiwis,theyhaveoundavourwithconsumersinAustraliaandtheUnitedKingdom.Again,gettingthefavourproleotheseproductsrightisthekey
tosuccess,asnoamountoancypackagingandadvertisingwillhelposet
poor-tastingood.
1 Introduction
There are few aisles in a New Zealand supermarket that do not contain a
Heinz Watties product. It has 30 brands in its stable, including Watties,
Heinz, Lea & Perrins, Chef, Champ, Eta, HP, Farex, Nurture, Greenseas,Weight Watchers, Praise, Oak and Craigs. With over one thousand domestic
products, it covers canned, frozen and shelf-stable foods, including canned
fruit, tomato and other sauces, baked beans, spaghetti, creamed rice,
seafood, dressings, frozen vegetables, soups, jams, baby food and pet foods.
Watties also supplies the foodservice industry with quality products, such as
tomato sauce, soups, curry bases, canned fruit and vegetables, baked beans,
frozen vegetables, dressings, jams, and seafood.
Increasingly, the foods that Heinz Watties makes are found in supermarkets
and foodservice overseas, with Australia and Japan carrying the brand of its
sister companies.
2 Background
WattieshasbeenmanuacturinghighqualityoodproductsinNewZealand
since1934.TheounderJamesWattie(laterSirJames)startedhisruitpulpingandcanningbusiness,J.WattieCanneries,inaour-roomedcottageinHastings.
Wattiesbeganasaproduceroruitpulp,thencannedseasonalruit,andhas
expandedtobecomeamajorsupplierooodproductsorbothdomesticand
exportmarkets.SirJamesbuiltacompanybasedonsoundbusinessprinciples,creativeideasandtheinvolvementandenthusiasmohisemployees.In1992,
WattiesbecamepartotheglobalHJHeinzCompany.
Fromitshumblebeginnings,HeinzWattieshasbecomeamajorcontributor
totheNewZealandeconomy,withannualturnover inexcesso$650millionandaworkorceomorethan1,800includingseasonalworkers.Ithastwo
majorproductioncentres,Hastings,wheretherearetwoprocessingacilities,
andChristchurch.Theseareworld-scaleacilities,withtheKingStreetplantinHastingshavingthelargestcanneryintheSouthernHemisphere.Therozen
productsplantinChristchurchproduces50,000tonnesorozenpeas,carrots
andbeansayear.
HeinzWattiespositioninthemarketistheresultoitsstrategicresponsetomarketconditionsanditsabilitytointerpretand,ideally,
anticipateconsumerdemands.Around80percentoproductsagainst
whichitcompetesareimported.Theseimportedproductsotenhavetheadvantageolowerproductioncosts,duetothehighervolumesproduced,
aswellascurrentlybenetingromanimportriendlyexchangerate
duetothestrongNZdollar.Stayingaheadthereoremeansbeingagilerapidlyadaptingtothemarket.
3 Themarketplace
Currently,thesplitbetweendomesticandexportsalesoproductsproduced
byHeinzWattiesisaround45:55a
hugeincreasesince2000whenitwas85:15.
Domestic:Asignicantactoraectingthedomesticmarketiscompetitionrom
importedgoods.Around80percentothe
productsitsbrandscompeteagainstareimported.Withanopenmarketandvirtuallyno
taribarriersinplaceinNewZealand,products
manuacturedo-shoreotenhaveacost-o-supplyadvantageandcanbesoldatdiscounted
prices.Wattieshighlevelobrandrecognition
anditsestablishedreputationprovidesomebueragainstimports,althoughitsmosteectiveresponse
hasbeentodevelopproductsthatbettermeetNewZealanders
demandsoroodsthattastebetter,arehealthyandareconvenientproductsthathelpanswerthequestions:Whatarewegoingtohave
ordinnertonight?Andorlunch?AndwhenIamaway
romhome?
International:HeinzWattiesexportsarangeoproductstoAustralia,
JapanandtheUnitedStates.Thisarmoitsbusinessisgrowing,thereby
providinggrowthopportunitiesorlocalproducersandgrowerswhosupplyHeinzWattiesintheHawkesBayandEastCoastregions,andin
CanterburyandSouthCanterburyintheSouthIsland.
4 Consumers
ToremainintouchwithwhatNewZealanderswantromtheirood
suppliers,HeinzWattiescontinuestoconductin-depthmarketresearch.
Duringthe1990s,HeinzWattiesundertookmajormarketresearchusingbothinternationalandNewZealandresearchprojects(andtheresultsare
undoubtedlystillrelevant).Theseprojectsocussedonchangingsocial
dynamicsandhowtheseinfuencedtheoodandmealpreparationohouseholds.Theresultsothisresearchidentiedaewkeytrendsthat
establishedthebasisorbothproductinnovationandmarketingoverthe
lastcoupleodecades:
Thenumberomealspreparedinthehomeisdecreasing(now
lessthan50percentintheUnitedStatesandaround70percentinNewZealand)
can be agileProo big companies
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AnotherwaybywhichHeinzWattiesretainsitscompetitiveadvantageisthroughthecreationomorecomplexorhighvalue-addedproducts.Forexample,rather
thanuseitsNewZealandgrowncropotomatoestocompetewithplaincanned
tomatoesimportedandsoldatlowcost,HeinzWattieshascreatednewandinterestingcombinationsandfavours,suchasMoroccanstyle,Pestostyle,Smoky
BBQfavour,TomatoeswithSweetChilliandIndianSpicedTomatoes.
6 Innovativecommunicationstrategy
OvertheyearsHeinzWattieshascontinuedtoproduceinnovativeand
successulmarketingstrategies.OnethatwillbeknowntomostNew
ZealandersistheWattiesFoodinaMinutepromotionseendailyjustbeorethenewsonTelevisionOne(andearlieronTV2).
Astheresultoresearch,HeinzWattiesrealiseditneededtohelpmeal
preparersthroughoutNewZealandanswerthequestionWhatsordinnertonight?Toprovidethishelpandhelpsellitsproducts,Wattiesdecidedto
communicatedailymealsolutionsandrecipes.Theserecipesneededtobeeasytoprepare,requirealimitedamountotime,usereadilyavailableingredients
andtastegreat.Also,orHeinzWatties,theyneededtoensuretheyincluded
awiderangeoproductsthatcouldbeusedintheserecipesandtheproductsneededtobereasonablypricedandavailableinsupermarketsacrossNew
Zealand.ThemainmarketingobjectiveotheFoodinaMinutecampaignwas:
To encourage the amily meal preparer todiscover a wide range o simple meal ideasthat the amily wil l love.
Othermarketingaimsweretoencourage
consumerstotrynewproducts,toincrease
consumerinterestinexistingHeinzWattiesproductsandtoincreasespecicproductandtotalsales.Heinz
Wattiesknewthatthiscampaignneededtoshowan
improvementinsalestobesustainable.
HeinzWattieswanteditscustomerstoseeitsproducts
asacomplementaryanduseulcollectionoconvenientoodingredientsoreverydaymealpreparation.Thetargetmarketwasidentiedasthemainmealpreparerwhowas
usuallyalsothehouseholdshopper.Thiscoveredabroadtargetage-rangeromyoungpeopleinfattingsituations,to
youngcouples,toamilies.Themarketstrategywastoreach
allNewZealandhouseholds.Takenacrossthewholemarket,
expandingamealpreparersrepertoireromvemealstosixorseven(ormore),andensuringWattiesproducts
wereintegraltothatexpandedmenu,wouldamounttoasignicantincreaseinspecicproductandtotalsales.
ThisthinkingledHeinzWattiestotheinnovativecommunicationstrategyoFoodinaMinute .Thisstrategyledtothe
developmentoanewcontent,anewormatandanewmediastrategy,and
brokemanyothetraditional advertisingconventions.
Whilethetelevisioncookingshowprovidedtheimpactandhelpedinspirethehouseholdshoppertotrytherecipe,HeinzWattiesrealiseditwouldneedto
supportthetelevisionwithothermediathatmoreeasilygavethespecicsothe
recipes.Thisincludedrecipeleafets,aspecialmonthlyeatureinNextmagazine,wherethepresenter,Allyson
Goton,isoodeditorandtheFood in a Minute
cookbookwhichisoneoNewZealandsbestsellersinthecookbookrange.Withthewebidentiedasoneo
themostimportantwaysodeliveringtherecipes,theFood in a MinutewebsitewaslaunchedinMay2002.Todayitisthemarketleaderintheoodandbeverage
segmentotheNewZealandwebmarket,witha30
percentshare.Itreceivesover4millionhitspermonth.
HeinzWattieshasnewinitiativesinthepipelineor2007,includingrecipe
textingandKidsintheKitchen.Wattieshasbeenatrail-blazerinadoptingthewebasakeycommunicationstoolorpromotingitsbrandsandsales.
7 Researchanddevelopment
HeinzWattieshasalwaystakenalong-termviewoinnovation.Thisisevident
initsproactiveapproachatKowhaiFarm,aresearcharmassociatedwith
LincolnUniversityinChristchurch.Thisisrunasacertiedorganicarm,andHeinzWattiessupportsthisresearchintoorganicarminginordertoencourage
armerstogroworganicallyandhelpthemmaketheswitchromconventional
toorganicarming.Itisawayoincreasingopportunitiesororganicproductinboththedomesticandexportmarkets.
Indeedwithmarketleadershipinover20categoriesandaccesstoqualityingredients,HeinzWattieshasestablishedareputationamongHeinzglobal
companiesordevelopingandtestingnewproducts.TheNewZealandmarket
isanidealsizetoallowproductconceptstobetrialledandrolledouttoothermarkets.Thisworkisundertakenbyateamo40productandpackaging
developmentstaandhasresultedinmanyworldrstscomingromNew
Zealand,includingsaucesandpouchmeals.
AdedicatedacilityatoneoHeinzWattiesplantsinHawkesBayalso
undertakesresearchanddevelopment workorHeinzJapan.TheteamhereincludesstabroughtromJapan.
8 Conclusion
HeinzWattiesisahighlysuccessulcompanyintheoodsectorbecauseoits:
Skillsininterpretingmarketintelligence
Understandingoitsmarkets,bothdomesticandinternational
Commitmenttoprovidingconsumerswithhighqualityproduct
Abilitytomovequicklyonnewproductdevelopment
Realpassionandcommitmenttoproductandmarketinginnovation.
Itisalargecompanywhosemanagementstyleenablesittobeagiletomove
rapidlytokeepaheadothepack.
GLOSSARYAdvertisingAdvertisingisbringingaproduct(orservice)totheattentionopotentialandcurrentcustomers.Advertisingistypicallydonewith
signs,brochures,radioorTVcommercials,directmailingsore-mailmessages,personalcontactandthelike.
BrandThetradingnameoaproductthathasahighlevelorecognitioninthemarketplace.Successuldevelopmentothebrandandbrand
mark(identiyingsymbolsanddesign)isaconsiderablemarketingtool.
InnovationAnewandcreativeidea,productorservice.Theprocess
oconvertingknowledgeandideasintobetterwaysodoingbusinessorintoneworimprovedproductsandservicesthatarevaluedby
thecommunity.Theinnovationprocessincorporatesresearchand
development,commercialisationandtechnologydiusion.
Marketresearch Findingoutinormationaboutthecharacteristicsopotentialcustomerstosolvemarketingproblemsandhelpwithmarketing
decisions.
MarketingTherangeoactivitiesthatrelatetoidentiying,anticipating
andsatisyingcustomerneeds(protably)bymeansostandardtoolssuchasmarketresearchandpromotion.
ObjectiveAmeasurablegoaloroutcome.
OrganicProductionooodunderanaturalsystemusingminimalorzero
syntheticchemicals.
Researchanddevelopment(R&D)Future-oriented,longerterm
activitiesthatresultintechnologicaladvancesbasedaroundthreestages:
research,inventionandinnovation.
StrategicLong-termgoalsandobjectives(usually3-5years).
TargetmarketThegroupocustomersthataproductorserviceisdesignedtosatisy.
TurnoverTheamountomoneyearnedbyabusinessthroughsaleso
goodsandservices.
Value-addAnenhancementtoaproductorservice.
Questions and Extension Activitiesor Heinz Watties are on www.bizcs.co.nz
You will also fnd links to theWatties website
visit www.bizcs.co.nz For extension activities and questions on Case Studies Downloads Company ino Current Case StudiesNewZealandBusinessCaseStudiesLtd.Whilstevery
efforthasbeenmadetoensureaccuracyofinformation,neitherthepublishernortheclientcanbeheldresponsibleforerrorsoromissionsinthisCaseStudy.