\u201cThose people have greater expectations of the food that they are buying,\u201d the CEO said. \u201cWe have engineered the food to avoid some of the crutches of the food industry of the past to give consumers what they want.\u201d<\/p>\n
But it remains to be seen how the sweeping initiative, part of a broader commitment by Maple Leaf to cut waste and energy use to become \u201cthe most sustainable protein company in the world,\u201d will boost sales of its processed meats products, which have been flat to declining for several years.
\nThat was despite solid returns from the additive-free segment of its business that Maple Leaf already introduced in 2010, a line of prepared meats under the brand Natural Selections.<\/p>\n
Overall global demand for many processed meat products fell after the World Health Organization said in a 2015 report that processed meats, long containing ingredients such as sodium nitrite, are carcinogenic.<\/p>\n
\u201cI would point out that large food companies have had volume challenges in the last five years,\u201d McCain said. \u201cIt\u2019s not just a Maple Leaf issue, and it\u2019s not just in this category.\u201d<\/p>\n
Large food companies have been trying to recapture traffic from a more health-aware group of consumers that have begun to avoid foods that nutritionists say are unhealthy in favour of more \u201creal\u201d or \u201cnatural\u201d items, home-cooked meals using unprocessed food ingredients \u2014 whole grains, olive oil and fruit juices. While Maple Leaf also sells air chilled chicken and pork, it doesn\u2019t break down its sales mix between those items and that of its prepared meats, such as packaged bacon and cold cuts.<\/p>\n
![\"\"](\"http:\/\/wpmedia.business.financialpost.com\/2018\/05\/0515mapleleaf.jpg?w=640&h=480\")
<\/a><\/p>\nMaple Leaf Foods offices in Mississauga, Ont.<\/p>\n<\/div>\n
In recent years, the real food movement has hit processed food-makers hard, leading to markdowns and tepid sales in the so-called \u201ccentre aisle\u201d categories of the grocery store largely reserved for packaged food items. Sales of carbonated drinks declined 7.9 per cent between 2012 and 2017, according to data from market research firm Euromonitor, and cold breakfast cereal sales declined 8.4 per cent in the same period. Sales of margarine in the same period were weak, rising an average of 1.1 per cent annually.<\/p>\n
\u201cPeople are eating fewer prepared meats \u2014 that WHO report hit the industry hard,\u201d said Kevin Grier, a food industry analyst at Guelph, Ont.-based Kevin Grier Market Analysis and Consulting, who said Maple Leaf\u2019s natural ingredients initiative is a good idea.<\/p>\n
\u201cData shows that consumers care about nutrition, price and taste, and I think this falls into the category of a wholesome, quality product with good ingredients,\u201d he said. \u201cI think it will help to differentiate them in a slow-growing marketplace.\u201d<\/p>\n
That said, Maple Leaf might be facing bigger issues ultimately in the face of growing competition from U.S. pork producers who have added more production capacity into the market, Grier said. Canada exports 60 per cent of its pork production and Maple Leaf is one of the largest industry producers. \u201cWe export far more than we can consume in Canada,\u201d he said.<\/p>\n
And Sylvain Charlebois, food industry expert and dean of management at Dalhousie University, said growing evidence of the benefits of eating more plant-based food and evolving consumer habits mean that Maple Leaf has a bigger issue on its hands.<\/p>\n
\u201cThe narrative around animal protein is quite dominant, and it is not positive,\u201d Charlebois said. \u201cThat is what Maple Leaf is up against. When Burger King starts to sell a veggie burger, it\u2019s a sign. This goes beyond the ‘naturalization’ of an offering \u2014 it\u2019s much broader than that.\u201d<\/p>\n
Maple Leaf has begun to diversify its offerings, acquiring two major plant-based protein companies the last year, Lightlife and Field Roast, and now has a market share of more than 50 per cent of the category in Canada.<\/p>\n
While growth in the segment has been in the double digits, it is a minuscule part of the company\u2019s overall business. \u201cRelative to protein consumption in total it\u2019s a small market, but it\u2019s gaining momentum,\u201d McCain said. \u201cAnd as small as it is, small in the U.S. is pretty attractive to a Canadian company.\u201d<\/p>\n
When it comes to transforming the image and recipe of its classic Maple Leaf processed meat products, McCain, who was lauded for successfully reviving the company\u2019s reputation after a listeria outbreak was linked to a Maple Leaf plant in 2008, admits it can take some time to change consumer perceptions and behaviour.<\/p>\n
\u201cAs a brand marketer I am very conscious of the fact that consumer behaviour is highly habitual and it takes a long and sustained period of time to modify those habits and behaviours,\u201d he said. Sales of prepared meats at the company were up in the first quarter, before the recipe and branding changes were announced.<\/p>\n
\u201cEarly indications, whether they are extraordinarily positive or extraordinarily negative, don\u2019t necessarily reflect the changing behaviour of consumers\u2019 buying patterns,” McCain said.<\/p>\n
Financial Post<\/em><\/p>\n \u2022 Email: hshaw@nationalpost.com<\/a> | Twitter: HollieKShaw<\/a><\/em><\/p>\n","protected":false},"excerpt":{"rendered":" CEO bills the move from preservatives to basic ingredients like lemon juice as the ‘single biggest brand strategy initiative’ in the 91-year history of the company<\/p>\n","protected":false},"author":578,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[],"tags":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/9601"}],"collection":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/users\/578"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/comments?post=9601"}],"version-history":[{"count":2,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/9601\/revisions"}],"predecessor-version":[{"id":9630,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/9601\/revisions\/9630"}],"wp:attachment":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/media?parent=9601"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/categories?post=9601"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/tags?post=9601"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}