Campbell Soup uses AI to go from Mmm, Mmm Good to even better

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When Campbell Soup Co. introduced its new Chunky Ghost Pepper Chicken Noodle soup, along with a “cool-off kit,” featuring a towel, fan, sweatband and tissue, in January as a limited giveaway to the first 500 people who signed a “waiver” acknowledging they were brave enough to try it, it took less than two minutes for the offer to be claimed with more than 36,000 sign ups.

That’s when the company knew it had a hit, said Craig Slavtcheff, Campbell’s chief research and development and innovation officer.

“All of the media impressions and the social media posts by consumers and the buzz that it created was really impressive,” he said. “And that’s when we knew we were onto something there.”

By using one of the hottest peppers in the market, Campbell created Chunky Ghost Pepper Chicken Noodle Soup to be 13 times spicier than its original Spicy Chicken Noodle soup, while maintaining the familiar flavor of chicken and vegetables. Based on the consumer demand, the product will launch in full distribution later this year—just in time for “soup season,” which Campbell loosely defines as fall through winter.

It’s also the latest innovation Campbell developed with the help of artificial intelligence.

For the past three years, the Camden-based soup and snack giant has been increasingly leaning into the technology for insights that guide the development of new products. “The Insight Engine was conceived … when we started really renovating our innovation processes and culture for Campbell’s. And at the time, we basically set out to transform how we looked at trends and how we track data on trends. And that’s where AI came to be evident as a pretty powerful tool, because what it allows you to do is expand your radar and cover much more data, much more areas of information and then bring greater fidelity to some of the trends coming out,” Slavtcheff said.

“Meaning, quantifying their adoption, quantifying where they’re happening and quantifying whether they are on the upswing or are they on the downswing.

“These are all critical points when you start to decide, do I want to innovate against a specific trend? And if so, how do I want to innovate against it?” Slavtcheff explained. “It’s really about leveraging data.”

Taking stock

By combining those AI-infused insights with its internal incubator program, Campbell’s Maker, the company has doubled down on product innovation – whether for a limited time offering, a new platform or core renovation – and has been able to bring those items to market much more quickly.

Just a few examples include Pepperidge Farm Goldfish Frank’s RedHot crackers, Spicy Sirloin Burger soup and Prego Spicy Marinara Pasta sauce.

Innovation is also a key part of Campbell’s strategy at its two divisions (Meals/Beverages and Snacks), with CEO Mark Clouse describing it as the biggest area of opportunity for future growth in the company’s brands.

During a December 2021 Investor Day presentation, Clouse recapped Campbell’s efforts to revamp its approach through a combination of technology and culture, saying it has “meaningfully expanded and strengthened” an innovation pipeline that “has never been stronger and better aligned with consumer trends.”

Between 2017 and 2020, just 1% of net sales came from innovation products. As of the Fourth Quarter of Fiscal Year 2022, innovation represented 2% of the company’s $2 billion in revenue for the period, bringing the company closer to its goal of 3.5% by 2025.

With a strong pipeline of new products within its two divisions, Slavtcheff believes Campbell is well-positioned to reach that benchmark.

“Our purpose is to connect people through food they love. And that’s part of what innovation does, it brings excitement and curiosity and engagement by consumers with our brands. And because of that, innovation’s a key part of bringing our purpose to life as a company,” he said.

“And we’ve really transformed our innovation capabilities through this combination of technology like AI, as well as culture, like the maker’s culture approach, where we’re just doing rapid prototyping and translating quickly insights and data into prototypes and then working with consumers … There’s a lot of energy not only in R&D, but also in marketing and the insights team, all the functions to lean into innovation and have it be a growth lever for the company,” Slavtcheff said.

The power of AI

The AI engine – which Campbell says analyzes more than 300 billion data points annually – has allowed the company to expand how much more information it can review, curate and process to learn more about a particular trend.

“The tool is basically always on, so it’s constantly scouring … the areas that we tell them to focus on, and then we can go deep in terms of a certain area we want to understand,” Slavtcheff said. “All of that data is brought together, which gives us more focus and direction to be choiceful on where we want to innovate and how. And that’s really the power of the AI—being able to scour a lot more data than we could manually through natural language processing in other elements.”

Along with general social media chatter and consumer sentiment around food, Slavtcheff said the Insight Engine pays attention to three other spheres.

“One was the area of culinary and cooking, obviously, because we have a lot of our brands, which are core in consumer’s behaviors of cooking at home. And then, also a lot of our brands are inspired by what’s happening in restaurants, social media, quick-serve restaurants and menus,” he said.

“The second area was around health and wellbeing and fitness and diets, so looking at what’s happening with the latest trends on health and wellbeing and being able to extract that into our pipeline,” he said. “Then, the third was the interesting area of food startups. Many of these companies when they start up are so small, you may not be able to even track them, be it traditional syndicated data. So having a tool at hand that would allow us to keep our fingers on the pulse of what’s happening in the food startup space was really important,” Slavtcheff explained.

Before the adoption of the Insight Engine, product development was a “highly manual” process, according to Slavtcheff. “It was a group of chefs and product developers just searching out magazine articles, all the publications online, looking at industry reports, those kinds of things.”

The new technology “brought the power of data and the power of statistics to the equation, which, in the past, would’ve been really difficult to do via our old tools. So, it [development] really transformed in three ways. One was speed. The second one was cost and efficiency. And the third was on depth, being able to go really deep on a topic and just have more data support the conclusions that we use then to feed into the pipeline,” he stated.

Slavtcheff went on to note that many AI platforms “have really just come about with the advancement in the world of IT and the world of data and computational power in the past three years,” enabling Campbell to leverage “the best of what’s going on in the world of tech to advance our purpose of bringing consumers food that they love.”

“And it’s really linking back to our purpose—connecting people through food they love. And that’s where R&D really gets their energy from, [it is] making and designing food consumers will love and delivering it through brands that they trust. That’s really the magic of what we do. And having access to interesting things that are happening in the world of food and then being able to leverage them and bring them to our brands and our consumers is an exciting part of the job,” he said.

Dialing up the heat

Spicy food is hot right now – in more ways than one.

Younger consumers, particularly Gen Z and millennials, are kicking up the demand for heat, wanting food that is bolder and spicier than what previous generations preferred on their plates.

As a result, many restaurant chains, such as Wendy’s, KFC and Taco Bell, offer items for spice seekers. And a growing number of snack brands have a “flamin’ hot” variety, including PepsiCo’s Cheetos puffs and Kellogg’s Pringles chips.

Following a spike in the number of options for those who can’t seem to get enough heat in their eats, interest is growing for spicy flavors inspired by global cuisines, particularly those featuring unique and exotic peppers, such as scorpion pepper, death reaper, spicy sesame ginger and pineapple ancho chile.

But as more consumers embrace newer variations of those flavors, it can be a challenge for brands to keep up with what’s trending, making it even more important to conduct research to help stay ahead of competition ahead of industry shifts.

After noting the “fairly sizable percent of consumers who do love super spicy food,” Slavtcheff said he believes they’re interested in “adventurous eating.”

“They’re looking for twists on the familiar, looking for a little more flavor and experience with the food. At our core as humans, we are explorers as it relates to what we eat and what we put in our mouths. And so, it’s no surprise that spice continues to be an area where you can add a little bit to a food item and make it a different experience. And you see that both within the seasoning category, within salty snacks and also within [quick service restaurants]. So, we’re seeing a lot of just spice showing up everywhere, just making it a more interesting experience,” he said.

When it came time to analyze the data, Slavtcheff said, “One of the things that we discovered was this notion of twists on the familiar, where it’s a good way to articulate how people want to get into spice. So, spice consumers have this sort of curiosity, but also trepidation when it comes to spice. Is it going to be too spicy? What is the nature of the spice going to be? And so, being able to ease them into it in a way that they feel comfortable.”

Slavtcheff said, “I think the spicy platform for Chunky is a great example of that, where it was was spicy versions of favorite items like Chicken Noodle, where consumers were sort of like, ‘Yeah, I can sign up for this. This sounds interesting,’ because it’s a twist on the familiar. It was highly successful in the market, a very important launch for us, which then expanded into a whole new platform. And that’s where the power of that tool allows us to think about what are the other elements of this platform.”

Thanks to its innovation strategy, the company brought the heat with several new soups from its Campbell Chunky line last year, including Spicy Chicken Noodle, Spicy Steak & Potato, Spicy Chicken Quesadilla, Spicy Sirloin Burger and Spicy Chicken & Sausage Gumbo.

The beloved Pepperidge Farm Goldfish – expected to hit $900 million in annual net sales this year – also underwent a bit of a makeover.

In an effort to attract adult snackers, Campbell partnered with McCormick & Co. in 2021 to launch Goldfish Frank’s RedHot crackers as a limited time offer. It then followed up with several other LTO flavor mashups for the brand, including Old Bay Seasoned Goldfish with McCormick and Pumpkin Spice Grahams with Dunkin’.

With the collaborations proving to be popular with consumers, Campbell plans on relaunching certain limited-edition flavors at strategic times during the year.

Slavtcheff said, “All of these LTOs sold out very quickly, so there was good success in the market. And then even with our new platform under Goldfish, which is called Mega Bites, which is a larger Goldfish with much more cheese flavor, much more high impact flavor. We had a cheddar jalapeño, which is doing very well as part of that launch. So, using spice as a way in for older consumers, and even tweens and teenagers, has been a good use of the tool to help guide us for the culinary trends that are relevant for snacks.”

During the company’s March 8 earnings call, when Clouse highlighted a 15% growth in sales for the snacks segment, he pointed to the Goldfish brand as one of the standouts. With its limited time offering strategy, consumers were twice as likely to purchase those products alongside other Goldfish items, he said.

After being inspired by the uptick in at-home cooking during the pandemic, Campbell introduced FlavorUp!, a new line of cooking concentrates that can be stirred into any meat, grain, vegetable or plant-based protein dish for an instant pop of complexity and flavor. It was also Campbell’s first major brand launch in six years.

When Campbell fired up the Insight Engine, it sought to find out what people were cooking and what ingredients they were using, which ultimately led to three varieties of FlavorUp!: Caramelized Onion & Burgundy Wine, Rich Garlic & Herb and Savory Mushroom & Herb.

“Just building on that, linking the cooking behavior that went up significantly during COVID and working from home, we adopted that spicy platform across some of our cooking brands, like Prego, which had a very successful foray into the spicy category with Spicy Marinara, Arrabbiata and a number of traditional spicy Italian variants, which did very well,” Slavtcheff explained.

Just last month, Campbell’s Kettle Brand became the first snacking brand to release an air-fried chip. Using patent-pending technology, the company was able to kettle-cook and air-finish potato chips that deliver a light and crispy texture with 30% less fat than the original versions.

“All of our innovation is exciting and unexpected, by definition, and so, that’s the fun part of the job. Our Kettle air-fried potato chips, which is the first new platform for potato chips in the entire category, not just at Campbell’s, in probably over a decade, is a very exciting innovation where we tapped off consumer insight around air fryers,” Slavtcheff said.

“And the other part of that insight was, people were using it to cook potatoes at home. And so the notion was, how could we create an air-fried potato chip under the Kettle brand, that had a very unique texture, by incident, also had 30% less fat. It just tasted amazingly good … And it’s doing phenomenally well in the market. And further to that, we chose the top flavors that we launched with that product based on insights on what were the dominant flavors consumers consumed for potato chips: Sea Salt & Vinegar, Himalayan Salt and Jalapeno.”

Following each product’s launch, Campbell watches “very, very tightly to understand, literally on a weekly and monthly basis, how they’re moving in the market, what kind of velocity we’re getting at shelf and what kind of consumer feedback, both on social media as well as the traditional 1-800 number,” Slavtcheff said. “We track our innovations very tightly right as soon as they’re released, and we adopt and build future pipelines based on the feedback.”

He added, “And if you’ve got something hot, no pun intended, like we did with Spicy Chicken Noodle, we quickly turn up the heat on the future platform for that, and that’s exactly what we did with this soup season … You will start to see some more spicy variants even beyond Prego coming up in the future, as well as in our snacks portfolio.”

The company has plenty of iconic snack brands to innovate with. In addition to Pepperidge Farm products and Kettle Brand potato chips, Campbell’s snacks include Synder’s of Hanover pretzels, Late July tortilla chips, Cape Cod potato chips and Lance cracker sandwiches.

Its meals/beverages division brand portfolio includes its namesake soup, as well as Prego pasta sauces, V-8 juices, Swanson broth, Pacific organic soups and Pace salsa.

The ‘human element’

AI may be changing how many industries operate, making many fearful they’ll lose their jobs to automation; Slavtcheff stressed the importance of “the human element” when it comes to how Campbell is using the technology.

“It’s such a critical part of design, and that’s never going to go away. Being able to have access to more data allows you to come up with more theories and ideas and build your pipeline of project ideas, but ultimately, it’s the design work and then the culture around innovation that translates that data into products that consumers are going to love,” he explained.

“And so, the human factor when it relates to design is where you get the contextualization of the idea, how’s it going to fit within consumers lives? How’s it going to fit within their pattern of consumption or their pattern of cooking? And that’s a critical part. So, the chefs play an important role in managing the data and extracting the data,” Slavtcheff stated.

He also pointed to the value of the maker’s culture within Campbell, which encourages all employees, including chefs, food scientists and package designers, as well as those in other divisions, to pitch ideas that could eventually become a product.

As part of an effort to increase connectivity, collaboration and enhanced career opportunities for employees, Campbell plans to invest $50 million to upgrade and expand the company’s headquarters amid a consolidation of its snack businesses from Connecticut and North Carolina.

While Clouse admitted it was a “difficult” decision to close those offices, he said it “is the right thing to do for our business and culture.”

The changes, which are expected to occur over the next three years, will add about 330 positions to Campbell’s Camden offices, bringing the total local workforce to about 1,600. According to Campbell, the company has been evaluating plans to unify its snacks division following its $6.1 billion acquisition of Synders-Lance Inc. in 2018. Currently, operations are spread across multiple office locations, mainly split between Camden, Charlotte and Norwalk, the company said.

As part of the plan, Campbell will upgrade existing space as well as construct new buildings, including a new campus center, research & development facility, pilot plant, day care center, café and complimentary fitness center.