In the foodie's quest for socially-conscious, healthier, and accessible food options, there has been talk of growing millennial distrust of bigger foodservice companies, even as those major brands are eager to draw in this influential buying crowd. While distrust remains an obstacle for large companies, McCormick & Company is rising to the challenge with a millennial-focused growth strategy. How? With all the things millennials love: technology, cultural variety, and going green and clean.
This Fortune-1000 spice and flavor firm is no stranger to success. From winning first place at the 2016 Sustainability Excellence in Manufacturing Awards (SEMA) to a handful of other innovation and supplier of the year recognitions, McCormick is no doubt on a mission to transform and mold with emerging trends. According to Food Business News, McCormick & Company expects to reach $5 billion in sales by the end of the 2019 fiscal year, up from $4.4 billion in 2016.
“Today, taste remains No. 1. … But the number of consumers who are considering an evolving series of emerging drivers has grown substantially. Roughly half of consumers say their purchase decisions are significantly influenced by these emerging drivers. At McCormick, we are positioned to capitalize on both the traditional trends and the newer consumer values," CEO Lawrence E. Kurzius told Food Business News. "We are particularly proud of our sales growth. ...Nine percent of our 2016 sales were from new products launched in the past three years."
Global Gourmet and Going Fresh and Clean
Consumers are looking for healthier alternatives, all without losing fun flavor combinations. In fact, the demand for flavor has even grown by 10 points across the general population since 2007, according to McCormick President of Global Consumer Business Brendan Foley. This is where McCormick's spices come in.
To give millennials' homemade meals a kick — especially as Foley also noted that 64 percent of millennials love to cook and 32 percent of them prepare ethnic dishes for dinner — McCormick's brands such as Thai Kitchen, Zatarain's, Simply Asia, and Lawry make this goal literally in reach, right on their spice racks or in their pantry.
Millennials make up one-third of McCormick's online traffic and a study shows that 80 percent of them view McCormick brands as one of the best options available, if not the best one. That being said, this company is not turning a blind eye and aims to cater to this audience with even more transparency.
When it comes to clean options, another major consumer concern, McCormick doesn't just offer organic retail options, they've also renovated packaging of certain products to take sustainability another step further.
“By the end of the fourth quarter, 73 percent of our gourmet units sold were organic and we expanded shelf space with four of our top 10 retailers,” Foley said to Food Business News. “This initiative also enabled us to win new distribution to come in 2017."
“Our latest renovation includes all-natural extracts, which were converted from imitation; and all-natural food color. We’re also excited to announce the launch of BPA-free packaging for McCormick Black Pepper and Old Bay and have a companywide goal for all of our packaging to be BPA-free by the end of 2017.”
New Products and New Tech
McCormick plans to keep things fresh with their next array of products. For instance, future products, like Gourmet Garden's lightly dried chives, will feature technologies that McCormick acquired when the brand bought Gourmet Garden, a manufacturer selling chilled packaged herbs. Foley added that it was apparent consumer demand for fresh ingredients was growing, if Gourmet Garden retail sales rose 27 percent in the United States last year.
“This business greatly advanced our closer to fresh innovation with patented technology and knowledge of fresher ways to deliver herbs. ...We now have a lightly dried technology that keeps herbs fresh and protects against wilting without any additives or artificial preservatives. Consumers, especially millennials, really spark to this product promise. We plan to further expand the application of this technology and innovation as it is an important platform for us in the perimeter and center-of-store," Foley told Food Business News.
But that's not all up McCormick's sleeve. Later this year, the company is launching a new clean label breakfast platform, which will highlight 18 items that can be used to flavor pancakes, smoothies, oatmeal, yogurt, and eggs. The four major product lines are breakfast toppers, seasonings, slow-cooker breakfasts, and smoothie boosts.
"Whether it’s your morning oatmeal, yogurt or even planning a weekend brunch, McCormick Good Morning allows you to flavor your favorites with real ingredients and fewer calories. All of them are clean label and most will be gluten-free." Foley said.
So, there you have it. Global variety, gluten-free options, and go-green initiatives? What more could a consumer want? Although IRi reported that the top 25 U.S. food companies have lost $18 billion in market share over the last five years — while smaller and mid-sized companies made up 46 percent of growth during that time —, will McCormick be a brand that proves millennials can trust large foodservice companies after all? And will McCormick reach its $5 billion goal? The future is never guaranteed, but one thing is for certain: McCormick is on the right track to responding to developing trends with their multi-faceted growth strategy.