Back in November I had a chance to join a panel on social networking at the Harvard Business School’s annual marketing conference. It was a chance for HBS students and other guests to get firsthand perspective from a range of leaders on the front lines of marketing change today. My panel went well, but I had more fun listening to some of the other speakers who joined the event. One of my favorites was a keynote presentation by Jaya Kumar, Chief Marketing Officer of Frito-Lay North America.
Kumar shared how the company is really rethinking its entire marketing approach across its brands, and was enjoying a 10 percent organic sales lift in 2008 as a result—the highest rate among the largest CPG companies in the country. Perhaps the best story he shared was that of the incredible shift of the SunChips brand toward meaningful marketing. I wanted to share his story here, bolstered by some other research I discovered.
SunChips was originally launched in 1991 as a healthier snacking choice, featuring whole-grain chips made with sunflower oil. The key benefit pitched at the time was its 30 percent less fat versus regular potato chips. While the brand held a niche on shelf, it never really took off and growth stalled over time. Most people only encountered it as a snack option on airline flights.
A few years ago, however, the brand team discovered that the same people who buy SunChips because they are more concerned about health also happen to be more concerned with the planet around them. According to Gannon Jones, Frito-Lay VP of Marketing, in Brandweek:
We started to see that there was an intersection of people who were concerned with their health and with the planet’s health. Out of that was born the hypothesis that we could begin to connect SunChips more prominently with the environment so [the brand would become] a small step for me and the planet.”
The team decided to test the hypothesis and realigned its brand and marketing to deliver on a promise to “Grow the best snacks on earth.” One early step was moving to a California manufacturing plant that is completely solar powered—thus literally delivering on the “sun” in SunChips. It’s the largest solar power field in the state and produces 145,000 bags per day. The brand also “buys green energy credits to offset 100 percent of the electricity needed to produce SunChips snacks.” The billboard above is another clever way to show what the brand stands for.
The results of the SunChips repositioning have been dramatic: Sales grew 17.6 percent to $201.8 million in 2008. It has tripled its household penetration in the past four years. Remember, that’s for a brand that has been around since 1991.
Now the company is driving aggressively to do more in support of SunChips by doing more for the environment. Kumar described how Frito-Lay is working to invent the first completely biodegradable bag. A teaser video claimed that they are targeting Earth Day 2010 for its arrival, and he promised to give away the technology to all competitors. Naturally, SunChips will be the first to bring it to market.
Lessons from the SunChips story:
1. Even an older brand can remake itself. It’s never too late to teach an old brand new tricks. Here, SunChips simply stretched what it could mean as a brand and discovered insights into what its core target market found meaningful.
2. “Marketing” means much more than advertising. Nowhere in Kumar’s speech was talk of high-scoring television copy or digital media buys. Rather, the marketing came in the form of PR about a change in the brand’s production process. It is remarkable that the brand positioning was able to impact how a factory was powered. It is extremely rare to see this happen in a large, established company—making this story even more powerful.
3. Actions speak louder than words. A few posts ago I wrote about how marketing with meaning involves actually doing something to show what you stand for as a brand, rather than simply throwing up a piece of advertising that talks about it. SunChips gets the fact that today’s consumer is skeptical of claims (take the oil companies’ advertising, please), so it had to take big actions to win.