What's All This Fuss About Campbell Soup's New Label Design?

7 years ago

On Monday, September 29, 2008,  499 stocks on the S&P 500 lost value. In one of the most historic sell-offs in the market's history -- the market tumbled 799 points -- just one stock gained value -- Campbell Soup. Pundits didn't shy away from the symbolism. Was this a sign that Americans wanted to focus on the basics after a decade of greed and excess?

Oh, to have been Campbell Soup back then and feel cautiously optimistic that this recession could be good for business. Truth is, the recession hasn't treated Campbell Soup poorly. Their sales are up. However, if you explore beyond the bottom line, that increase in sales is coming despite the fact that sales in the soup division are off by 18 percent.

The news of this precipitous drop in soup sales comes almost simultaneously, and not accidentally, with Campbell Soup receiving a ton of publicity over its announcement that it used neuromarketing to help redesign its iconic soup label.

Will changing the soup label really help drive sales? Campbell Soup spent two years trying to figure that out. Now, it's not unusual for a company to do market research to try to figure out what will appeal to consumers, what is unusual is that Campbell Soup publicized that they had turned to "neuromarketing," a fact they shared in an interview in the Wall Street Journal.

For two years, Campbell researchers studied microscopic changes in skin moisture, heart rate and other biometrics to see how consumers react to everything from pictures of bowls of soup to logo design.

This "neuromarketing" approach is a fresh attempt among consumer-good companies in understanding how consumers really respond to marketing and advertising.

Reaction to Campbell Soup's research method was fast and plentiful.

From Everything PR,

Measuring things like heart rate increase, certain brain activity and temperature and moisture changes, neuromarketing is able to tell a lot more about your responses to a particular brand than just answering a series of survey questions. The idea behind this type of research is to tap into the aspects of your unconscious in order to see the things you may not even recognize yourself.

Eliz, a commenter on BoingBoing, raised concerns about the research methodology.

Once again my past rises to haunt me. I worked in market research (mall intercept). I had to get out because of the rampant and inherent corruption. Rest easy, folks: the people who ran the eye tracker were reporting useless data. Very, very rarely do industry insiders recruit the right individuals, brief them properly or operate the device correctly.

Executives at Campbells came up with the new design and then paid one or several market research firms to tell them what a good idea they had with 'research data.' The MR folks paid teenagers $5 - $15 to say what they wanted and sent them on their way.

Insidiousness fail -- corruption win.

From a public relations perspective, Campbell Soup must be pretty happy. First, they announced the new labels and that got tongues wagging. Within a couple of days, they were back in the news, sharing that while sales projections were declining, they were also stirring up the ingredients in the soup products. Yum Sugar calls it getting a face-lift.

The company has cut sodium in 23 of its condensed soups by 45 percent, to contain new type of roasted chicken.

Will the combination of new labels, new ways of shelving the soup and a change in ingredients bring people back to the brand?

I stopped buying canned soup a decade ago. It wasn't because of the taste. Having grown up on Campbell Soup, I like the taste. It's just in my mind, purchasing the fresh stuff is healthier. Maybe it is, maybe it isn't, but my current consumer belief is that fresh is better than canned.

While that may be a troublesome trend for the entire canned soup category, I'm not the customer they are trying to win back. They want consumers who still buy canned soup but who are now opting for private labels.

The Wharton School of Business recently held a conference called "Connecting With The Evolving Consumer." One of the ways consumers are evolving is they are migrating to private brands. That is not good news for Campbell Soup. The news from a panel discussion at that conference was that once you lose a consumer to a private label, the brand will not get that consumer back (providing the private label does a decent job). Chris Kuenne from Rosetta advertising said brands have "three weapons" to use in their fight against private labels.

One is innovation. "The moment when the value proposition of your product begins to collide with those of private labels, you have a very, very big problem," he noted. "You should have a continuous pipeline of ways of differentiating your product." The second is managing a product throughout its logical life cycles. As it becomes less new and less differentiated, prices should fall to reflect the product's lower, entry-level status.

Kuenne says the third has to do with shelf space.

"Private labels only work when there's a branded competitor that establishes a price umbrella under which the private label can operate." By "rationalizing the shelf," he said, everyone wins: Stores get sales, consumers get choice and brands get an adequate amount of shelf space.

Given all these other external considerations, will a new label and reduced sodium put a dent in that 18 percent decline in soup sales? Here's a look at the new label.

What do you think?

BlogHer Contributing Editor: Business & Career


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