3/1/2013 8:10 PM ET|
Spam is sizzling again, and Hormel is smiling
Sales of the once-derided 'ham in a can' are soaring. And a new digital ad campaign aims to put the meat on more plates than ever.
Turns out Spam (short for "spiced ham") is all of the above.
Strong sales of Spam have helped fatten the bottom line of parent company Hormel Foods (HRL), whose recent first-quarter earnings report was in line with Wall Street's expectations, with overall profits and sales up slightly.
Hormel president and CEO Jeffrey Ettinger says the Spam "family of products" led sales for the company's Grocery Products division -- which saw its overall revenue rise 24% during the first quarter, compared to the same period in 2012. It also had a 13% increase in operating profits for the quarter. Hormel recently acquired another iconic American food brand, Skippy peanut butter.
Part of Spam's new-found popularity apparently goes back to its traditional role -- as a way for cost-conscious consumers to get some meat in their meals without breaking the family budget.
Like the rest of the nation, Hormel has been dealing with higher meat prices for its products. But "despite facing considerable commodity cost pressures, Hormel continues to benefit from a solid brand portfolio of convenient, value-added products," Ken Perkins, an analyst with Morningstar, wrote in a recent research report.
Looking to strengthen its appeal with younger consumers, Hormel has just launched a new digital ad campaign, featuring the animated Sir Can-A-Lot. Using the slogan, "Break the Monotony," Sir Can-A-Lot will "seek out and respond to Internet users suffering from routine meals and boring tweets, addressing many of them personally with a unique web video," the company says.
Hormel has also partnered with Chef Roy Choi, a leader of the current food-truck movement so beloved by foodies, to come up with some unique Spam-based recipes.
Spam has been a longtime staple in Hawaii, Korea and elsewhere around the Pacific Rim. And in the press release, Chef Choi says the canned meat "echoes my passion for connecting the world together in celebrating how many families survived and prospered, seeing the can as a sense of hope and as a delicious mainstay."
He adds: "This recipe creation has allowed me to also more intimately connect with my Korean heritage, Hawaii, and with all immigrant families that made their way to America."
All that and more, in a can of spiced ham.
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