It might be summer, not exactly peak season for hot soup, but Douglas R. Conant has plenty to say about the fortunes of the Campbell Soup Co., where he has been president and chief executive officer since early 2001.
He spoke recently about the Camden company's progress, challenges in U.S. soup aisles from General Mills' Progresso brand, plans for new markets, and Campbell's efforts to reduce the sodium content of soup.
Question: During your tenure at Campbell Soup, there have been some ups and downs in momentum. What causes that?
Answer: What we do here in the company, it's life. Life is full of ebbs and flows, and situations affect the best-laid plans, right? This year, we're dealing with unprecedented dynamism in our cost structure. . . . Commodity costs, fuel costs just having a profound impact on how we're managing our business every day operationally.
. . . It's been a bumpy year quarter by quarter. . . . But we'll finish fine. I will tell you I feel great about our year. . . .
Q: What do you do about your U.S. soup division?
A: Let's step back. . . . Seven years ago when I got here, you remember we were compared to a buggy whip, right? . . . Now, seven years later, we've grown sales and consumer take-away every year for seven straight years. We have taken a 25-year decline in condensed soup and started growing again. We have grown ready-to-serve soup every year since I've been here, and we've accelerated the growth abroad. . . .
We have done everything you could ask for of this category, other than grow share against a niche player. . . . That little niche player has put a blemish on an otherwise amazing story in terms of rejuvenating the soup business. . . . Just reduced sodium line of soups is larger than the entire business of that niche player and growing faster. But somehow everybody wants to talk about that niche player.
. . . What we learned this year is we have to have a certain scale and pace to innovation. It was insufficient this past year. . . .
Q: How's it going in China and Russia?
A: . . . We're bullish about it. . . . The framing of this is very simple. We are the world's largest soup company. We do over $3½ billion worth of soup globally. . . . But we're only in 6 percent of the world's soup consumption. . . . We studied the world and found the two biggest markets in the world, which are half the soup consumption of the world, are in Russia and China. . . . And there is no established competitor in either market. They're largely homemade soup markets.
So, we developed these propositions, consumer propositions, for these soup-starter concepts that help people make their homemade soup faster better and better than they could before with greater consistency. In both markets, we're getting great traction. . . .
Q: How is Campbell Soup's battle against sodium going?
A: . . . Our commitment is to . . . make sodium a non-issue with the consumption of soup. As I've said all along, I'm a little circumspect on this. But we expect to do that in my lifetime. . . . But we've made great progress. Our reduced-sodium business today is $650 million in retail sales, and it's growing at about 30 percent per year. . . .
Q: Talk about the experience you've had in Camden with the expansion of your corporate headquarters and the office park development.
A: I was kind of naive there, but I shouldn't have been. . . . We thought we had a well-conceived plan, still do, for really doing our part to help transform Camden, and we ran into some opposition on some particular points related to our plan. We're working through that, and it's taken longer. . . .
Q: You are in year eight as CEO. How long do you expect to stay in the job?