Photo: Charlie Riedel/Associated Press
This column doesn’t make stock calls. This column is not irrationally exuberant about the market for sweet packaged snacks given the frequency at which Americans are told to stop eating sugar and to stop eating processed food and to stop snacking.
Still, it’s worth remembering that not every consumer is craving locally grown, organic quinoa. And there seems to be at least one CEO in the food industry who understands that Americans aren’t always willing to eat as instructed.
The Journal reports:
Hershey Co. Chief Executive Michele Buck said the company aims to strike “more balance” between its longstanding candy businesses and the healthier snack operations it has been building up via acquisitions.
Consumers talk a big game when it comes to eating healthy, but Ms. Buck said the company’s candy business isn’t going anywhere, and in many cases remains bigger than the healthier offerings.
“Consumers don’t always do what they say they are going to do,” she said.
And they don’t always do what they’re told. Ms. Buck is no doubt aware of the fortune that private equity investor Dean Metropoulos has made reviving non-trendy brands like Twinkies and Pabst Blue Ribbon and investing in savory snacks like Utz potato chips, even if such products are not necessarily celebrated by public-health experts.
What would we do without experts? Many consumers might simply enjoy favorite indulgences in moderation. The Journal has more on the Hershey story:
Sometimes consumers are looking for an indulgent snack and other times they’re looking for a healthy snack, Ms. Buck said, and the company is trying to provide both. “It’s really about capturing incremental snacking occasions,” she said.
Ms. Buck also warned that food companies have to be careful about tinkering with beloved brands to make them healthier. “The number one thing [consumers] want is the brand as it is; they don’t want it to change,” she said.
Ms. Buck is on to something. There’s no question that consumers have in recent years been demanding more healthy options, but that doesn’t mean they want all the existing options to change or disappear. Campbell Soup Co. learned the hard way that reducing flavor is not the answer to sluggish revenue growth. “Taste trumps everything,” says Ms. Buck.
This may sound obvious but the atmospheric pressure in the food industry to market less tasty foods has been intense. So it’s refreshing to hear from a CEO who talks about her plans to “delight consumers” while declaring that “indulgent snacking is alive and well.”
In January, the Journal’s Annie Gasparro noted that the storied chocolate company is not ignoring changes in the marketplace, but trying to seize new opportunities without destroying old ones:
Hershey has acquired snack companies including Amplify Snack Brands, the maker of SkinnyPop popcorn, which Hershey said it would buy last month for $1.6 billion. Hershey Chief Executive Michele Buck said the deal was part of her plan to remake the 100-year-old candy icon as a broader snacking company....
On a conference call last month, Ms. Buck stressed Hershey’s commitment to both its older, indulgence brands and new, nutritious snacks. “We are certainly focused on and love our current portfolio within core confectionery,” she said.
Here’s to letting Americans continue to enjoy the snacks they love.
Speaking of focusing on the consumer, President Trump did a creditable job of explaining at a Wednesday press conference what the last decade of monetary policy has done to bank customers. His message was particularly welcome given that, as the former real-estate developer acknowledged, he tends to favor low interest rates. Said Mr. Trump:
When President Obama had an economy that was — it was the worst comeback since the Great Depression and all that — you’ve all heard that. But remember, he was playing with zero-interest money. He was playing with funny money. That’s easy. I’m playing with fairly expensive money.
So when he does that, the people... in their whole life, they would save 10, 15, 20 percent of their salary and put it in the bank. Those people got killed because they put their money in the bank. They were going to live off the interest, and there was no interest.
Now, those people are starting to get interest. And those are the people, frankly, that deserve to — you know, they did a great job. The people that did it right, the people that did the best job got hurt the most.
So in one sense I like it, but basically I’m a low-interest-rate person. I hate to tell you.
Consumers can tell him that whether they are saving money or buying Hershey’s chocolates, they are definitely enjoying a stronger dollar.
Bottom Stories of the Day will return tomorrow.
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(Teresa Vozzo helps compile Best of the Web.)
Mr. Freeman is the co-author of “Borrowed Time,” now available from HarperBusiness. This month Journal subscribers based in the U.S. can download a complimentary e-book edition.