Heinz has redefined its new product development process as it seeks to re-energise its European business and drive category growth.
Heinz Europe president and CEO Joe Jimenez said the company wanted to increase its success in NPD.
"The strategy is to restore Europe to top line growth through innovation. Bottom line growth will follow," he said.
Jimenez said Heinz's market share was growing but the key in a deflationary environment was to encourage consumers to use more product.
He has formed an innovations executive comprising 12 top marketing and technical directors from across Europe. This executive has been set "tough" financial hurdles against which it will measure each new product idea.
Heinz had been resourcing 500 projects. When put up against the new criteria, only 50 passed. "Previously everyone got a little resource and we were not fully supporting new innovations. There was not a lot of analytical rigour. The innovations team is designed to fix this. We will put the resource into backing new, bigger ideas and invest more in analysis."
He expects about 15 products a year to be launched across all EU geographies and categories. The focus will be on health and convenience.
This month sees the first test of the innovations executive with the launch of Top Down tomato ketchup, as well as microwaveable soup cups.
Heinz is continuing its strategy to reduce clutter by halving the number of items sold in Europe. "We are increasing productivity of shelf space. Some varieties in every line will go," Jimenez said.
Businesses that underperform will be closed or sold. Heinz has already exited from frozen pizza with the closure of its Grimsby plant.
The company is also looking to acquire businesses in growth categories in core geographies. At the moment the UK, Holland and Italy account for 50% of sales. Jimenez is seeking to strengthen operations in Spain, France, Germany and Poland, its gateway to Eastern Europe.
The company has also embarked on a programme of employee training and more aggressive succession planning.
Heinz Europe has a target of 3-4% net sales growth and 8-10% operating income growth in the fiscal year beginning May 1. Last year sales were up 11% to $3.1bn with operational income up 12%. Global sales were $8.2bn.
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