There’s a common perception—not entirely unjustified—that the Canadian arms of global multinationals aren’t afforded a great deal of autonomy when it comes to marketing decisions, especially since we share not only a border, but also cultural touchstones and—the past four years notwithstanding—a general worldview with our neighbour to the south.
The Americans also happen to be one of the world’s leading exporters of marketing and advertising, and that combination of geographic and cultural closeness has led to a gradual hollowing out of Canadian marketing, particularly when it comes to the global giants.
But Kraft Heinz Canada dispelled that notion in 2020 with a series of prominent made-in-Canada initiatives that garnered acclaim not only here at home, but also international recognition. The sheer amount of playful, engaging and strategically sound work that came out of Kraft Heinz Canada during the past 12 months made it impossible to overlook when it came to determining our first-ever Mighty List Marketer of the Year.
In these waning days of what has been a torturously long year, though, it seems important to remember the backdrop against which Kraft Heinz Canada was performing.
During a February earnings call, global CEO Miguel Patricio told analysts that 2020 would be a year of “stabilization” for the company—which was coming off a disastrous 2019 defined by a massive US$15.4 billion write-down (one of the largest in corporate history) of its Kraft and Oscar Mayer brands.
The common perception of Kraft Heinz, one repeated ad nauseam by the business press, was that its brand portfolio was increasingly out-of-touch with changing consumer tastes. Today’s consumers, they said, are seeking out new brands, cheaper private label alternatives and even healthier, organic products with clean ingredients.
Its downfall was further ascribed to the involvement of Brazilian private equity firm 3G Capital, which partnered with Berkshire Hathaway to bring Kraft and Heinz together in a massive US$50 billion deal in 2015.
3G is notorious for ruthlessly hunting out cost efficiencies. Shortly after the merger, said one report, Kraft Heinz’s then CEO Bernando Hees directed employees to make sure they printed on both sides of paper, and it was announced that free Jell-O would no longer be available in the company’s head office.
In that February earnings call, Patricio informed analysts that the world’s fifth largest food and beverage company, which proudly boasts of having 98% household penetration in North America, would not be “playing offence.” Instead, he said, the plan for 2020 called for stabilizing the company’s bottom line and allocating resources towards its biggest and most iconic brands.
He then sent reverberations through the agency world when he said that the company planned to pare back its agency roster, while at the same time pledging a 30% boost in media spending to support flagship brands with better momentum and margins.
On the surface, the announcement seemed to portend a reduced emphasis on creativity and brand-building in favour of a greater emphasis on amplification—the time-honoured marketing approach of creating awareness among consumers by bludgeoning them with a barrage of advertising.
Those concerns, though, turned out to be unwarranted, at least in Canada. Instead, agency partners like Rethink and No Fixed Address (see our Mightiest Agency feature) have put forth a steady stream of outstanding work over the past 12 months.
Even a cursory glance at Kraft Heinz’s 2020 marketing reveals a litany of relevant, on-brand—and often just plain fun—work: from Kraft Dinner’s tongue-in-cheek (we think) attempt to cash in on the annual Pumpkin Spice craze with its October launch of Pumpkin Spice KD; to a delightful piece of nostalgic advertising featuring former Barenaked Ladies singer Steven Page, who once referenced Kraft Dinner in the band’s hit song “If I had $1,000,000” (and who has by now attained his objective many times over) as a fur-clad high-roller; to Heinz Ketchup’s pre-Oscars bid to receive recognition for its hundreds of uncredited appearances in the movies, to the launch of a clothing line for its baby food brand Heinz by Nature celebrating an expected wave of pandemic babies with messages like “my parents put more than just sourdough buns in the oven.”
There was also a spate of charming albeit lower-profile work: Philly’s unveiling of a new Philly Angel, one of its most popular and enduring brand platforms, subtly reflected the country’s changing demographics; the clever launch of a double-sided “Stick Together” jar containing both smooth and crunchy variants of Kraft Peanut Butter; partnering with Burger King to launch a deep fried macaroni and cheese menu item called KD Bites; and the attention-getting “Send Noods” campaign for KD inviting people to send noodles to a love interest (which was subsequently pulled after complaints).
Many of these programs reflected the company’s marketing mantra of “acts, not ads.” Nearly every Kraft brand benefits from high awareness and widespread availability, but this was marketing with a focus on creating something far harder to attain than shelf presence: consumer affinity.
There is a vigorous debate in marketing circles right now about whether brands are prioritizing short-terms gains (likes, mentions, shares, etc.) at the expense of long-term brand health that can help safeguard against changing market conditions.
There are some who argue that much of that Kraft Heinz work relies on buzz and earned media, yet it’s difficult to argue with the sheer diversity of work across such a broad spectrum of brands—particularly when the company could have opted for the “safe” marketing that has characterized some of its previous work.
Kraft Heinz’s brands are famous, and in many cases synonymous with the categories in which they compete. Kraft Dinner is macaroni and cheese, and Heinz and ketchup are practically interchangeable, with Heinz controlling a massive 76.1% share of the market according to Euromonitor data (and while not a marketing solution per se, it’s worth noting that this year also saw the company rectify one of its most recent missteps by bringing its ketchup production back to Canada after exporting it to the U.S. in 2014).
In other words, awareness isn’t a problem Kraft Heinz’s agency partners are tasked with solving: It’s about making its brands (more) famous and likeable.
There was perhaps no better embodiment of that philosophy this year than the Heinz Ketchup Puzzle, a truly original piece of marketing that was also perfectly on-brand. Based on the insight that puzzles were gaining favour among people cooped up at home during the pandemic, the puzzle also built on the brand positioning of Heinz Ketchup being a notoriously slow pour by consisting entirely of 570 red pieces. A slow ketchup deserves a slow puzzle after all. The puzzle, which was brought back for the holidays, has also been exported to markets including the U.S., U.K. and Australia.
Kraft Heinz is used to operating from a position of strength in the categories in which it competes, but in launching a new hazelnut spread towards the end of the year, it also signalled a willingness to go head-to-head with a category giant like Nutella.
Even when it found itself in the rare position of being a challenger brand, it rose to the occasion by playfully tweaking the incumbent in a rich, emotive TV campaign that saw it take its upstart offering to Italy, the birthplace of Nutella, where it was met with resounding approval (at least, that’s what the ads tell us) from locals.
In broad terms, the work suggests a high level of trust between Kraft’s senior marketing teams and its agency partners, a willingness (and confidence) to experiment with ideas that stretch the parameters of CPG marketing while continuing to focus on marketing fundamentals.
As in the food and beverage space, product formulations in marketing tend to vary on a country-by-country basis. In 2020, Kraft Heinz Canada created the perfect formula.