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The Interview - New Covent Garden - a healthy business all round

New Covent Garden is the UK's leading brand in the chilled soup sector, the fastest growing sector of the overall soup market. New Covent Garden is driving category growth with major marketing support for its 26-strong core range, the introduction of premium lines and regular Soup of The Month launches to attract new consumers. The New Covent Garden Food brand has long been synonymous with soup, but the brand is also committed to taking its quality proposition into other areas where food is not "as it should be." The Grocery Trader went to Peterborough to meet Nigel Parrott, New Covent Garden Food Company Group Marketing Director. GT - When was the New Covent Garden brand launched? New Covent Garden began trading in 1986, and initially supplied Selfridges, Harrods and other up market retailers. GT - When did you break into supermarkets? Sainsbury's approached us in early 1990. They were the first major multiple to stock chilled soup in the UK, and really got behind the brand. The media quickly picked up the story about how you could now get fresh soup in a carton. By the mid 1990s most major multiples stocked New Covent Garden soup. GT - Who owns New Covent Garden Food now? Founder Andrew Palmer sold the company in 1997 to Daniels Chilled Foods, part of Singapore Foods Industries. The present management came on board in 2001, which is also when I joined the business. GT - How do you sum up the New Covent Garden brand proposition now? It's all about food as it should be - making food correctly, and developing products for categories where food is "not as it should be." GT - Where do you make your soups? We have three sites. Peterborough is the biggest and produces premium and more intricate products, using vegetables from the Fens. We develop new recipes here too. The original factory, in Willesden, London, makes simpler soups and our biggest volume lines, Carrot & Coriander and Wild Mushroom. The third factory, in Cork, Ireland, supplies soups for foodservice. GT - How big is the New Covent Garden brand overall? What products does it cover besides soup? New Covent Garden is worth £44m in retail and growing 13.3% annually. Some 90% of brand sales are soup, the rest being Risottos, in three recipes; Fresh Porridge, in two kinds; and Sauces, in five varieties. GT - How big is the UK chilled soup market, and what share do you have? Chilled soup in the major multiple retailers is a £98m market, with another third through foodservice. We have a 45% share, up from 33% in 2000, in a market showing double-digit growth over that time. GT - That's a massive achievement. How did you do it? We re-launched the brand in 2002, when we realigned the proposition to our core audience - up market ABC1 females aged 45 plus, representing over 60% of our consumers. We redesigned the pack with more traditional values and improved the product quality, so we're indisputably the best available. We've also committed to investing in advertising, PR and quality initiatives. GT - How fast is the UK chilled soup market growing, and what's driving it? The market's growing 10.5% p.a., with consumers migrating to fresh soup from other chilled foods like pasta and pizza. Health concerns are the main driver. GT - What are your biggest selling soup varieties? The top seller is Wild Mushroom (10%), then Carrot & Coriander (8%), Leek & Potato (7%) and Soup of The Month (7%.) GT - How do you keep consumers interested? We do it by creating news on the fixture. With Soup of The Month there's always a new story - we've just had the Halloween-inspired Hubble, Bubble, Toil & Trouble in October, and we've got our student chef winner's soup Sweet Potato & Red Onion in November. We also carry out in-store displays, and promotions in store. GT - What are your new regular Soups for this autumn? We're launching Celeriac & Bacon, replacing Tomato, Chorizo & Chickpea, and introducing two premium lines, Toulouse Sausage & Puy Lentil and Clam & Bacon Chowder. GT - What are your pack sizes and prices? The standard soups are 600g, price £1.99, and the premiums £2.39 for 600g. GT - What's the soups’ maximum shelf life, and how do you preserve them? They last 12 days. The soup is packed hot at 85˚C and sealed: we don't use preservatives. GT - What proportion of New Covent Garden Soup sales are through supermarkets? Some 87% is sold in supermarkets. The rest is export and foodservice. GT - Whereabouts in the UK are the 'heavy usage' NCG consumers? Some 45% of sales are inside the M25, where the main effort was made in the early days. There's huge growth potential elsewhere. GT - What constitutes 'heavy usage'? Heavy usage is two packs per fortnight. GT - What are the purchasing patterns for soup? Most fresh soup is bought on the Friday shopping trip, for eating on Saturday lunchtime with partners. It's a planned opportunity, but an impulse choice. 25% of the population buys fresh soup, and 12.5% buy New Covent Garden. GT - What time of year are soup sales strongest? Soup sales peak in winter, starting with the first wind and rain in October. The season stops when it's warm enough to eat bagged salad. Our soups sell all year round, but our winter sales are five times the summer level. GT - How are your soups made? Our soups are made in batches in the same way as you would at home, by frying onions and finely chopped fresh vegetables, adding water and or milk and cooking the mixture until soft, liquidizing it, then adding any garnishes, ie the lumpy bits that need to be firm to the bite, like chorizo sausage or chicken, and then packing the soup. GT - Do consumers see your soups as overtly "good for you"? The core consumers buy them for taste first, health second, but new consumers increasingly buy on health grounds, as part of a balanced diet. GT - You recently introduced the Food Standard Agency's traffic light labeling to your range, depicting levels of fat, salt and sugar. When did the new-look packs go in store? We launched the traffic light label packs on 23 September. We've followed the FSA guidelines 100%, and were the first UK chilled food company to do so. GT - What have you done to make your products healthier? Nothing! We’ve achieved our content levels without changing the recipes, because our products are naturally healthy to start with. Making soup batches means we can control the ingredient levels and keep them similar to home cooking. Recipes developed in our kitchen must perform the same way in the factory, or they don’t get sold. GT - Has the Health & Obesity debate been good for your business? Probably! We had record sales the week commencing 2 October, after Jonathan Ross was enthusiastic about fresh soups in general on his TV show. GT - Can you get your '5 A Day' with NCG? Most of our soups contain more than five vegetables, but under the rules of the Government’s '5 A Day' scheme, soups can't claim '5 A Day' because people can't eat the required quantity - unless you consume several litres at a time! GT - How are you addressing the lunchtime/food to go sales opportunity? We're doing so with our Soup In A Cup offer, which is microwaveable and drinkable in two minutes: you can't get much hotter and fresher than hot fresh soup! Soup In A Cup has a £1.29 RSP for 300g. Current recipes are Leek & Potato and Plum Tomato & Crème Fraiche. They are ideal for "ping and ding" microwave usage, and heat through evenly, with no risk of overheating. They're available in the sandwich fixture in Tesco and in foodservice outlets. GT - Are you actively involved in encouraging farmers and growers to produce more 'heritage' crops? Heritage and traditional methods are very much part of our brand proposition, but we also look for new, different foods to push consumers’ imaginations. For example one of our potato suppliers is looking at potato tubers from Peru, where potatoes originated, and seeing whether they are better to use in our soup. GT - You've recently launched a 'Soup for all Seasons' recipe book. How can consumers get their hands on a copy? It's actually our third book! The New Covent Garden Book of Soup for all Seasons helps confirm NCG is run by enthusiastic individuals with a passion for food and making good quality soup and other food "as it should be." We create the books and Macmillan publishes them for us. They're on sale in Borders, Waterstones, Sainsbury's and on-line from Macmillan and elsewhere, price £14.99. GT - How do you work with retailers to maximise their chilled soup sales? We buy a lot of consumer data, and manage the category by offering real consumer insight to retailers to help deliver category growth. GT - Where should chilled soups be merchandised in store for best results? In a superstore, they should go in chiller cabinets as the first things you see coming out of the vegetable aisle. In an urban c-store, they should go next to chilled ready meals and meal solutions. GT - How much are you spending this year on marketing and advertising? We're spending £3.5m in total. We're advertising in food and gardening titles and supplements, and doing PR around the Soups of The Month. We produce a Comic Relief fundraising soup every year. We also support the National Trust, Woodland Trust and the Alzheimer Society. GT - Are you launching any limited edition Christmas soups this year? Yes, we're producing a Festive Ham & Vegetable 600g Soup of the Month for December, a winner of the BBC Good Food magazine competition. It'll be in store the last week in November. GT - Finally, where do you see New Covent Garden going from here? As a brand we're set to develop into some exciting new categories - we're looking at some very large ones where food is not "as it should be," so our turnover could be at least 50% bigger in a year's time! Soup will stay our core business: given 25% of people buy fresh soup and half of those buy ours, there's still a huge growth opportunity. If we got half the population to buy fresh soup once a year, we could turn them into regular users quite easily, because of our outstanding quality offer. New Covent Garden Foods Tel: 0113 248 0606 www.newcoventgardenfood.com www.danielschilledfoods.com