The name Campbell’s Soup may conjure up memories of rainy-day lunches — or Andy Warhol paintings — but the $8.5 billion company owns a whole bunch of brands that have nothing to do with tomato soup. New Jersey-based Campbell’s also owns Pepperidge Farm, Goldfish crackers, Prego sauces, Swanson frozen meals, Cape Cod potato chips, and Snyder’s of Hanover pretzels.
But future growth, explains Judi Mondello, a Vice President of Research and Development at the company, depends not only on finding ways to continue growing those valuable brands, but tuning in to the changing tastes of younger consumers and keeping an eye on developments in the startup sphere.
Mondello spoke with InnoLead for our latest research report, Retooling R&D for a New Era. Prior to joining Campbell’s last February, Mondello had previously spent 15 years at the J.M. Smucker Company, another iconic food firm.
What’s been new in this last year or so, either in terms of tools, or ways of working, or new pressures?
I can talk a little bit on the business side and then also just on the R&D side, because I don’t think that they’re exclusive. From an R&D perspective, I’d say over the last almost two years, we really had to figure out ways of working virtually, which really didn’t exist prior to the pandemic.
We even do product cuttings — we ship product to people’s homes, and we evaluate it live, versus all of us being in the same room. We’ve been able to make it work. I would tell you that it’s not ideal, but it works. And then we’ve done, obviously, ideation and brainstorming.
I don’t think anything is better than being in-person, other than maybe just an administrative task. For R&D, as collaborative as we are, we’re usually touching stuff and making things and trying things, it’s just better to be in the office.
We hired some folks during the pandemic, and we did some virtual training. We would make soup or a product, and we had video streaming technology so that they could watch and see it and say like, “Okay, I get it.” It’s almost like they’re in the lab themselves. We’re using the Microsoft HoloLens technology for the training protocol.
Now we’re at a hybrid model. We’re in the office a couple days a week, and we’re working remote a couple days a week. And that seems to work well.
Tell us a little about the product testing you’ve done at home.
Now that we’re back in the office hybrid, we’re trying to set up our product tastings on the days that we’re on site. That’s helped. …Prior to that, it was all virtual. Every day, we get a shipment of products to try. We have V8, we have Prego, we have Campbell’s soup, Pace salsa. Every day, I would get a shipment and try the product, and we would do an evaluation. Sometimes, we’d have a scorecard that we fill out. Sometimes we would just do verbal [evaluations]. It helped especially with our marketing partners and some of our supply chain partners — it really helped for them to see the product that we’re inventing, even though we weren’t all in the same room physically.
I think the big challenge will be, how do you drive growth beyond the core?
To zoom out to the high level, what characterizes a great R&D organization now?
It’s net sales, right? It’s growth, and that’s what we deliver. That’s pretty standard across the food industry, and I would say across all industries — it’s some sort of competitive advantage and growth through innovation.
From a talent perspective, it’s continuing to build technical talent as well as business acumen. [The C-suite expects us to know] what are the macro trends, and what’s going on externally. [We have] a really strong technical organization that understands more than just the science and the technology behind our products, but the bigger picture, and is partnering with our marketing teams to understand future vision.
I think the big challenge will be, how do you drive growth beyond the core — because it’s expensive to go outside of your core business and drive growth in a meaningful way.
Is it a trend for you guys do the lean startup test-and-learn method, where you’ll put a new package in with just one retailer and in a limited quantity?
We are doing some of that, and [I] would expect that we might do more, just based on some of the issues that we’re having in the supply chain, whether that’s transportation, material supply, or packaging supply. As well as on a retail partner side, they’re having trouble as well, whether it’s labor shortage, carrier shortages. I mean there’s times where we ship products to one of our retail partners, and they don’t even have the resources to unload the truck. Just really between labor and material shortages, it’s really an interesting time. We are looking at [new products], whether it’s limited-time offerings or a small-scale regional launch.
The other thing is direct-to-consumer. If you think about e-commerce and direct-to-consumer, companies are doing a six-month launch of a new item, and it’s only [available] direct-to-consumer. They’re getting feedback, and then they’re going to go to a national retail launch later. That’s a model that we’re seeing pop up.
You’re a new-ish hire at Campbell’s. What’s been changing there? Most people seem like they’re still kind of in the mindset of, “We want to hire people who could theoretically show up at one of our facilities, as opposed to in Tierra Del Fuego where they’re never going to be able to go in.”
For R&D, because our roles are so hands-on, we really do require that people are on site. We have several R&D sites across the company, but our main [location], the meals and beverage, or the division I lead, is in Camden, New Jersey. So we really expect people to work out of there. We’re so collaborative. We have a culinary center. We have pilot plants. We have small bench-top capabilities. I mean, you can’t really replicate that at home.
We’re so collaborative. We have a culinary center. We have pilot plants. We have small bench-top capabilities. I mean, you can’t really replicate that at home.
In terms of recruiting though, given that that’s true, has anything been changing in how you find talent and bring talent onboard?
I think just the flexibility, where people can come and go has helped. Previously, there would be folks who would say, “I’m not interested because of the location.” But right now, since we’re hybrid, people are commuting. They’re managing it. In the past, [if you] had to be on-site five days a week — no flexibility, no negotiation — some people would just decline the offer. I don’t know how long that’s going to last. But with current statistics, I would tell you that this flexible work arrangement is going to happen; it’s going to go on for a while.
We’ve recruited folks from all over the country. I don’t know [how it has been] historically at Campbell’s, because I haven’t been there long enough, but I do know [from] my days at Smucker’s, it was hard to get people to move to Northeast Ohio. …Things are way more flexible than they used to be.
Is anything changing in academic relationships and R&D?
I’ll talk about projects versus talent. Talent-wise, we still have a really strong internship program, and that’s a great way to bring students in and get a feel for their capabilities and interest, and then hire them if that works out… That’s very strong at Campbell’s, and that’s going to continue. Project-wise, we do have projects with universities.
One of the things that I’ve led [at Smucker’s and now at Campbell’s] is a student-led innovation program where we give them a challenge. They do a ton of qualitative work, and they come back to us with some ideas and concepts and really great insights. What I love about the program is that we get direct, unfiltered feedback from Millennials and Gen Z, and I have found that to be extremely valuable. That is a program called OnRamp at Ohio State University.
Then you have the traditional research — multiyear, highly-funded research academic projects. If it’s new technology, if it’s something you want to license, if it’s something that’s never been done and you want to pay the university to do the work in their area of expertise, that’s great. We’ve done that. I’ve done that my whole career. But for me and my team, we have found some really great ways to tap into the younger consumer in a really scrappy way to get feedback on our products, to get feedback on innovation, and to really get their mindset and their behavior and what they’re looking for, which is very different from my age.
I’ve been in R&D for 30 years. Those long-term commitments [to academic research labs], they’re not there anymore from what I’ve seen. You can’t make a long-term commitment in this type of volatile situation that we’re in. So typically, we’ll see one to three year [funding programs,] and that’s fine. But anything beyond a three-year [research] commitment, in my opinion, gets scrutinized, because we don’t know what’s going to happen after three years. If it’s transformational technology, that’s different. Working with universities still happens, however, we have various external partners who can meet closer-in versus further-out new technology or new product needs.
We get direct, unfiltered feedback from Millennials and Gen Z, and I have found that to be extremely valuable.
It seems like a lot of that academic relationship you spoke about with OnRamp is not just engineering, but marketing and communications.
And it’s product innovation. For example, soup. What Gen Z person do you know that eats soup at home? They basically say they’ll eat soup if their mom makes it for them, or they buy it from Panera, or they get it at a restaurant as an appetizer — that’s about it. We have to think about how are we innovating for this younger [crowd]. The older millennials, they’re sort of falling into some of what I would consider to be typical cooking behavior, especially if they have kids. They’re making dinners, they’re cooking. …So those are the type of insights that we get.
And then we look at that and say, “Okay, how do we build forward for Millennials, the younger consumer?” We just had an investor day. We had our Q1 quarterly earnings report. These are things that are [shared] by our CEO that say, “Look, we have to focus on the younger consumer, at the same time we’re building our core business.” And so that’s where I have found just great joy and insight working with universities.
Are you feeling like R&D groups have been getting more responsibility in understanding the startup world?
Absolutely. Over the last three to four years, some functions in R&D are picking that up, whether it’s an engagement model with startups, or an engagement model with a company that has really close touch points with startups, to get a pulse and a feel for what’s going on — whether that’s to acquire a startup, to license the technology, or to help [with] funding. R&D usually has a pulse of what’s going on, based on brand strategy, and based on the product line technology.
Sometimes, we see some new technology out of startups. If they’re highly-sophisticated, we could see some new technology that could apply to our businesses. And if it’s strictly just a product and innovation play, then it could be an acquisition where we say, “Look, they’re at a small scale.” You try to acquire while they’re small. You’ve seen this with Kellogg’s [and] everyone [else]. You acquire and move forward. But absolutely, R&D is expected to know what’s going on out there.
Sometimes, we see some new technology out of startups. If they’re highly-sophisticated, we could see some new technology that could apply to our businesses.
You’re known for having this particular product; people expect what it is. How do you balance that with driving innovation, and coming up with new ideas?
Campbell’s Soup is the heritage… but we own multiple brands, whether it’s V8, Pace, Prego, we have Pepperidge Farm, Goldfish, Late July, Snyder’s-Lance. So we have a snacking division, and then we have meals and beverage. Across those portfolios, we have dozens of brands that we can innovate around. We have a Well Yes soup brand that ties really nicely with what Millennials are looking for. It has more nutrient benefits. It’s cleaner label.
What we’re finding is that 78 percent of meals are eaten at home [right now.] And after the pandemic, whenever that happens, 71 percent of consumers plan to continue to cook at home. What are people looking for? They’re looking for quick. They’re looking for easy. They’re looking for good, delicious foods, new packaging formats, convenience, right? We still see on-the-go. That’s never going to go away.
My point is the benefit of this broad brand opportunity space is that we can innovate based on what consumers are looking for, and find the right brand that matches. We have organic and natural brands, and then we have our mainstream brands. It just works out really well that we have a place to go, regardless of where we’re innovating. It doesn’t have to be Campbell’s red-and-white can.It can be Well Yes. We have the Pacific brand, which is a natural and organic business focused on soup and broth and plant-based beverages. So you see what I mean? We have quite a bit of diversity.