PODCAST TRANSCRIPT

Jessica Hughes (00:00): Hey, it’s Jess. We’re back today with a new guest and I couldn’t be more excited to have Kasey Sheffer on the podcast today. Kasey serves as the director of private brands for retail business services under the Ahold Delhaize umbrella. She has over 17 years of progressive experience in brand strategy, development and deployment. In fact, she started at an agency, believe it or not. She oversees a portfolio of over 1.5 billion, yes, that is billion with a B, in private brands and products for the organization. And she drives the vision and strategy for the Giant companies brands, including Giant brand, Nature’s Promise and many more. As part of that management, she supports retail brands to develop and execute business plans and annual budgets that drive private brand sales and margin from product development through launch, including price, promotion, placement, and marketing plans.

Welcome to the podcast, Kasey. We’re so excited to have you.

Welcome to the Fork & Lens podcast brought to you by Viscul. Oh, smells delish.

All right, so obviously overseeing $1.5 billion, which is more than Hershey does in a year, which is kind of insane when you start to think about those numbers. But it’s a big task to manage private brands and products in that extreme quantity. So you’re curating, your marketing all of these things, you’re overseeing those exercises and activities, if you will. How have you built the brand awareness? I mean, 1.5 billion is nothing to scoff at. So how are you building brand awareness around all these private label brands from Nature’s Promise to Taste Inspiration to Giant brand to there’s so many.

Kasey Sheffer (02:05): Yeah, so to put it in context, we have a few different brands in the portfolio, the biggest of which is our first label. That’s kind of what we call it internally, the customer would call it the Giant brand. That represents 85% of our sales. So that’s where a lion’s share of everything comes from.

When you think about that, that’s one in every three items that’s sold through the register is coming from that brand so it kind of sells itself.

Jessica Hughes (02:33): Which is insane.

Kasey Sheffer (02:35): In a way. The awareness is there because it is so prevalent across the store. We’re in every category. I probably can’t give you the most accurate count, but we’re somewhere around 7,500 items across the store under that brand. So certainly there’s no other CPG or national branded item that’s just throughout the store to that degree or to that scale. So that certainly helps. I think that’s the starting point.

Jessica Hughes (03:00): That’s true. So does that mean 7,500, or sorry, 75,000.

Kasey Sheffer (03:04): 7,500.

Jessica Hughes (03:05): Oh, okay. 7,500. So does that include your limited time offers and those sorts of items that phase in and out during the seasons?

Kasey Sheffer (03:13): Yeah, that’s kind of all in. So about 85% of it is under that Giant brand or internally we referred to it as our first label because that’s kind of our work horse, right? It’s the one that has the lion’s share of the sales. Next to that we have Nature’s Promise, which I would say is about 10 to 12% of sales and that represents our organic and free from offerings. Great equity behind that brand. It’s been around, I do believe we launched it 16 years ago now.

Jessica Hughes (03:43): It’s hard to believe.

Kasey Sheffer (03:44): Yeah, so to the credit of Ahold and generations past, when they launched that brand, the company was surely ahead of their time. So we’re just building on their backs because it’s been around for a decade and a half really before organic was a mainstream conversation.

We have over a thousand items in Nature’s Promise and because it’s a unified look, it’s very clean, it’s very distinctive on the shelf, it’s easy for customers to identify it and understand what it is. And so Nature’s Promise is a brand that was within our legacy Ahold USA stores, which included the companies of Stop & Shop, Giant of Carlisle, now known as the Giant Company, and Giant Food in Maryland. Then a few years ago, it was also brought into Food Lion and Hannaford and continues to do extremely well. In that case, again, because customers can see it throughout the store, they can see the consistency behind it, we get a lot of credit and acknowledgement behind that brand as well.

We do a lot to make sure we understand customer perceptions behind our brands and Nature’s Promise historically remains among our strongest, if not the strongest, in our portfolio because customers trust us and they trust the brand. We’re very adamant to protect the integrity of what that brand has to offer and every product that’s going to be put into a Nature’s Promise package.

Jessica Hughes (05:17): So I want to go back to what you were just talking about with Food Lion and Hannaford, and obviously Giant Food, the Giant Company and Stop & Shop were all aligned and then Food Lion and Hannaford joined in later in the game. So you went through that process of figuring out what had the most brand equity in Food Lion and Hannaford versus Giant Food, the Giant Company, and Stop & Shop. What did that process look like and how did you figure out, okay, this has better brand equity than this brand that we have in this line of stores?

Kasey Sheffer (05:51): Yep. So the whole reason we were undergoing the question of what should be Ahold Delhaize USAs go forward brand for the organic and free from segment was a debate. Everyone is going to be passionate about the brands that they help launch and they help grow and we certainly didn’t want to make any decisions lightly. So we undertook pretty rigorous, I would call it very rigorous, research with customers up and down the East Coast to understand what would be the risk and what would be the potential upside for us to move in one direction or the other. So legacy Delhaize USA had a similar brand called Nature’s Place, ironically, a pretty similar name. So we made sure to test with Food Lion, Hannaford, as well as the legacy Ahold USA customers, light, moderate, and heavy customers, to say, what should we do with this? Where should we go? To make sure that we were going into that decision eyes wide open, because it’s a lot at stake.

Resoundingly though, customers who use the brand or patrons of the brand, they were highly loyal. Those for whom the brand would have been new, so the Food Lion and Hannaford customers said, “I do believe I would prefer this. I think I would be more inclined to potentially purchase more or contribute more of my basket to this brand because it conveys more trust. It conveys freshness in a way that perhaps the previous brand did not.” And so of course those are the only two measures. We made sure we clicked a lot of boxes to definitively recommend to the business and to the leadership that this is the direction we should be going at.

Anytime you make a change to a brand, obviously a lot’s tied into that from transitioning packaging labels, to making sure that customers understand the storyline and can make that transition with you. So it’s never a quick decision and it’s never an easy or quick transition in making that. But I do know it’s been successful in Hannaford and Food Lion since the transition, which has been pretty recent, actually in the grand scheme of things. And so I think it substantiates the decision that we made.

Jessica Hughes (08:09): Yeah, so obviously in the past couple of years, we’ve seen the transition of cleaner labels and Giant brand and even Nature’s Promise for that matter, really touting lower sodium, no high fructose corn syrup. There we go. It’s like a mouthful on Friday afternoon. Less sugar, all of these more clean label, clean ingredients mindset. What caused you to move in that direction and how much of an impact has it had?

Kasey Sheffer (08:43): Yeah, so we’ve always had really terrific leaders who have impressed upon us the need to focus on always creating better products for our customers. I’ll tell you in our industry, it’s pretty easy to say, “Hey, if I make that decision, it’s going to be more expensive and so it’s not a path I want to go down.” I think partially we can thank the fact that we have some European influence to help guide us in making decisions that really, ultimately, are better for the customer and better for the environment in cleaning up our labels.

So if we think back to a few years ago with Ahold USA, the conversation was around reformulating our products to remove sodium and sugar. Internally we deemed this health by stealth because we wanted to do it in a way where we could make these reductions happen without the customer being able to distinguish that we had materially changed the experience for them. So that proved to be successful for us because we could do it in ways that were really not in the consciousness of our customer, but we knew we’d give them a better product for them at the end of the day.

But that’s migrated a little bit and so the path that we’re in now, and our organization has talked about this pretty openly in the marketplace ,is that we’re making a commitment holistically to clean our labels by the year 2025. So beyond just sodium and sugar, those reductions spread more broadly and include things like high fructose corn syrup, artificial preservatives, synthetic colors. So it’s a much broader stroke to take our 7,500 plus items all through the process of getting them clean. So 2025 might feel like it’s a long ways away, but when you break that down into what does an actual project plan look like to get through all of those items, we have our work cut out for us.

Jessica Hughes (10:40): I mean, that’s more than a thousand items per year.

Kasey Sheffer (10:42): Yeah, its a lot.

Jessica Hughes (10:43): It’s probably closer to 1500 a year.

Kasey Sheffer (10:45): Yeah. And so when you put that body of work into the context of typical item development, which I always coined as the lifeblood of our success because customers needs change, their desires change and so you’re always going to have the tail end of an assortment that’s no longer relevant, and so you need to fill that pipeline with new items that will become more relevant and desirable from your customer base. We need to keep doing that work to build new items while we’re taking existing items and cleaning them through as well.

So yeah, there’s a lot of work. We touch a lot of items, adjust a lot of items every year on top of making sure we have that healthy pipeline of new ideas coming through all the time.

Jessica Hughes (11:27): So how do you identify new ideas for new products?

Kasey Sheffer (11:30): It can come from anywhere.

Jessica Hughes (11:33): I mean, we kind of get a little bit of behind the scenes look of what’s coming out, what’s new. I know that you attend a lot of the shows that we attend as an agency, which always has new stuff going like mushroom jerky and other weird things. How do you say that’s something that our customers are going to want?

Kasey Sheffer (11:51): Yeah. So it starts, I think, a place of understanding who your customer is. Now in my world, I work for Retail Business Services, which is a company of a Ahold Delhaize. So when I say my customer, my customer is the brand, is the retail brand. So in my case, I oversee the team that supports the Giant Company. So when I think of them as my customer, I want to know who their customer is, what makes her tick, what it is that she’s looking for and that becomes my first filter of what are the things I should be out there looking for.

When we say ideas can come from anywhere or anyone, that really is true. We develop about 600 new items a year just for the Giant Company. So those ideas, and I can probably rattle off some off the top of my head that come from various places from associate ideas to our suppliers are out there developing for us on our behalf and so they’re bringing new ideas to us. You’re right, I walked the PLMA show and we saw a supplier who had an interesting idea and we engaged them to do business with us. I think it does start from the place of understanding, ultimately, who you’re serving and it’s the shopper who’s going through the store and her needs are changing all the time. So how do we make sure we’re continuously thinking on her behalf and bringing her things that satisfy her ever changing needs.

Jessica Hughes (13:13): Yeah, and then, of course, I think of the products that phase out because you’re phasing other things in. Obviously there hits a point of okay, this isn’t performing well. And then you almost have to go through this thought process of, is it not performing well because of a scent, because of a flavor profile or whatever the nuance is? Or is it just something that she’s not interested in at all? I’m sure that you go through this market research of okay, well, why isn’t it performing well?

Kasey Sheffer (13:42): Yeah, certainly a lot of blood, sweat and tears go into developing new items so when you have to make the decision to pull them off the shelf, you don’t want to take that lightly. When you have items that begin not to perform, I’ll say up to speed with their peer group in that category, then you have to ask yourself questions and take a hard look to say, “Well, why is it? Could I have done something? Am I not doing something to support it in the way I should? Am I giving it the right attention? The right promotional plan?” Whatever that is, those items are owed the benefit of an analysis to say, “Yes, it makes sense to pull this off. It’s not worth its place on the shelf. We could replace it with something that would be better for the customer.”

It happens all the time. You always have a tail that you’re evaluating because you always have a new set that’s ready to come in and not everything can live forever on the same finite space on the shelf.

Jessica Hughes (14:36): It can’t. I guess my question to you would be, do you watch the trends of what name brands are doing and then say, “Okay, that’s selling for them so we should have a store brand of that?”

Kasey Sheffer (14:47): Yeah, we roughly know. We do take cues off the brand and we roughly know what percent of sales should be going to them versus us. We do have kind of a rough benchmark. That might vary category to category, but holistically, we kind of know where we should be.

So within a given category, we see that the growth is exponentially coming from a branded side and we aren’t really seeing our fair share, then that’s definitely a red flag to go in and figure out what’s happening there and what’s driving our decline or our lack of ability to keep pace with the national brand.

We cue off them also in terms of new technologies, new innovations, new flavors that they might be bringing in because a big part of the role of the Giant brand is to offer the quality of a national brand, but at a better price for the customer. So yes, by nature, the brand is designed to offer that national brand equivalent solution for the customer, so we have to cue off of what the national brands are doing.

But that’s not everything. We look to develop items where we think, “Hey, there isn’t a branded solution that the category can bring in to solve this. So let’s us go out and develop it first and be first to market.” In the space of private brands, that can’t always be the case that you’re the first to market, but when it happens, it’s really pretty interesting and it’s terrific to see because it’s really the type of project you can hang your hat on to say, “Look, we know customers. We know shoppers in this environment are very open to private label. We know that the trust is there for private label beyond which it has been in the past. So why can’t we take the risk and be first to market and really be the trailblazers to say, here’s something we have available that you might not have seen before so pay attention to this and have trust to purchase this.”

Jessica Hughes (16:40): Okay. So you’ve alluded to two different segments here. The first is the private label side. So you’re finding a product and you’re saying, “Okay, I can buy that from a supplier and put our name on it and we can put it to market.” And then there’s the other side where you’re going through full product development and your kind of first to market or you’re placing yourself into a market that you couldn’t find someone to private label for you. So how do you go about evaluating which route should we go? And then what are the nuances of going down those different roads?

Kasey Sheffer (17:09): Yeah. And you can have a supplier that actually covers both, that [crosstalk 00:17:14] both. You can have a supplier that says, “Look, everybody’s in this business. Everybody’s in this game of this item and it’s a gap for you. You really need to just pick up this item to round yourself out because it’s a big sales opportunity miss for you. Just pull this in, the formula’s ready to go. Here you go. We’ll put it in your label and make it available to you.” And that’s great, and that happens.

But then that same supplier we can work with to say, “We want to develop a formula unique to us because we’ve identified that this is where we want to be and so let’s go work on that together.” So I’m within my team, we have product development managers as well. And they’re food scientists by nature, some have culinary degrees, and their job is to go out and help us refine ideas with suppliers.

So the largest portion of my team is business-minded, they’re essentially category managers of the private brands space and they’ll help identify the business opportunity. But when it comes to, how do I turn that into actually something that works from a product perspective, especially for speaking to food items, then the product development manager will go work with the supplier to make the refinements necessary because they know the lingo, they can talk the talk, they know what needs to be done.

Jessica Hughes (18:27): That’s interesting. So you have almost this in house expert that goes to the supplier and says, let’s say you’re making a pineapple jalapeno salsa. There’s not enough jalapeno in that, you need to add more, or it’s not sweet enough or it’s not salty enough or it’s not acidic enough or whatever it is and they have that expertise that they’re able to go and do that.

Kasey Sheffer (18:51): Yeah, absolutely. Sometimes, for those of us who come from a business background, can’t necessarily articulate why we think something’s not perfected. Then it’s great to work with these folks who will come in and say, “Okay Kasey, I think you’re saying that because of this. I think it might be this and if we dial up that,” and whatever that solution is, they’re the ones that are able to articulate that and then work with the R&D folks of our suppliers to perfect it. So it’s really cool.

The number of folks it takes to be involved in a project before a product launches is many more than you would probably ever realize. Dozens, we have dozens of folks just along the process and it’s everything from helping us design labels to make sure those labels are safe, to make sure our suppliers are safe, up and down the line. So it’s a lot of hands involved in order to take something from idea to shelf. I think it’s really eye opening to think about those handoffs and how much is involved to bring that to life. It takes an army.

Jessica Hughes (19:55): Everything takes an army when we really think about it. No, I think that’s really neat. And the fact that these experts are able to articulate that, but then I’m sure they’re also bringing you ideas of like, “Hey, I think this would be something that would really sell.” When you go about that, do you do market research when they have an idea before you go and create prototypes of it? Or is it something that you’re like, “Okay, like let’s just run with it and see how it turns out?”

Kasey Sheffer (20:21): Yeah, I would say the good part and probably one of the biggest differences between private label and CPG is that the risk of failure or the cost of failure isn’t as great. And so because of that, we can be more nimble to say, “What’s the worst that can happen? Let’s give that idea try and if all the people that have to touch this from idea to shelf are blessing it and giving it the green light and are in support of it, then I think we probably have a pretty good shot to say this has legs or it has potential.” Because it’s less of a risk, I would say the degree of research or the degree of analysis required to test run that idea doesn’t need to be as great, but that’s not to short side what goes into actually creating the items.

Jessica Hughes (21:11): So how do you take something that’s been formulated, the packaging is done, all those different things and bring it to market and make sure that it’s placed correctly and that it starts to gain brand awareness and not necessarily brand awareness, but product awareness and traction within the marketplace?

Kasey Sheffer (21:27): Yeah. So we have a fundamental set of guardrails that we bear in mind when it comes to things like how are we going to develop this planigram? Where are the items going to sit on the shelf? What’s the pricing strategy going to be? What’s the promotional strategy going to be? We have guard rails and those guard rails help inform our customer, which again is the Giant Company, make decisions to help those items most succeed. So from that perspective, as it relates to all the Ps, except for marketing, we really just help guide the brand, the Giant Company, in making decisions to help best make it succeed or help it succeed.

From a marketing perspective then, we really lean on the marketing team within the Giant Company to help provide the traditional marketing support that you might think of. In our world, the ad or the circular still plays a really, really big role and a lot of the Giant companies customers still use that device pretty readily. So having placement in that piece becomes an important component of a marketing plan.

But aside of that, we will appreciate any tactic that the marketing team is willing to provide to help support the launches and the items that we have on the shelf. So whether that is social outreach or email or signage within the store, radio that they run when you’re shopping in the stores, what have you, I mean, the sky’s the limit. So really we lean on them very hard to help determine what the right level of support is across the right channels.

Jessica Hughes (23:04): Right I’m sure that a lot of the times people will be just kind of cruising the aisles and they say, “Okay, I need a spice rub,” and they’re looking at all the different products that are on the shelf and then they see the Nature’s Promise coffee rub or whatever it is and they’re like, “Oh, maybe I’ll try this.” It’s just kind of like those different flavor profiles that Giant brand or Nature’s Promise or Taste of Inspiration come up with are different enough that it just kind of peaks your curiosity and you’re like, “I can do that and it’s going to be something different than what I usually do.”

Kasey Sheffer (23:35): Yeah, and in that scenario it’s important for us to have solutions that could span the usage need, right?

Jessica Hughes (23:40): Yes.

Kasey Sheffer (23:41): So it could be, “Hey, I just need my traditional barbecue sauce that I want to be similar to maybe a Ken Steakhouse. So what do I have available there?” Well, that’s the role that the Giant brand plays in that national brand equivalent space. But then if you want something that’s organic or more of a clean free-from formula, then Nature’s Promise fulfills that role. But if I want something premium and really differentiated from a flavor profile perspective, that’s where Taste of Inspirations comes into play. So it’s really about having that full gamut of solutions across different brands, all within the private label portfolio, that really help influence the customer and help provide her solutions based upon her different wants and needs, which could change by the day, the shopping trip.

Jessica Hughes (24:29): A holiday.

Kasey Sheffer (24:31): Right. It’s really about having that span of solutions and because we’re private label and because we have multiple brands that each have their own place and their own specific role, it’s fun because we can play in different segments and we can flex. When we come to the solution that we’re trying to create, we figure out what is the right brand to put this under. What would the customer expect out of us? This is perfect for Nature’s Promise? Great, that that solution works perfect for us.

Jessica Hughes (24:59): Do you ever find yourself duking it out between this could play Nature’s Promise, this could play Taste of Inspiration or it could play Giant brand?

Kasey Sheffer (25:08): So as somebody who used to be the brand director for private label, I would hope to tell you that the way in which we wrote the rule sets behind the brands is so abundantly clear that there’s never any debate, but I would be lying to you. Yes, there are times when we think, “Well, it would be positive for this to be the Giant brand for these reasons, but it could also flex into Nature’s Promise so would we want to make that the brand with which we go to market?” So sometimes it can be a little bit of a debate, but I would like to say we try to establish the brands and established the guardrails behind the brands in a way that is pretty clear, the role and the reason why we have these different brands in existence.

Jessica Hughes (25:55): I can just envision the big sumo suits that you can rent with the big ring of people just duking it out. If I win this, I get it. If you do, you get it.

Kasey Sheffer (26:08): And in our world where we have five different sister companies that share a lot of the same product and a lot of the same labels, it can be a little bit of a conversation to say, “If we were developed to develop this item, we envision it being in this label.” Whereas a different sister company might have a different idea.

Jessica Hughes (26:27): Oh, that’s interesting.

Kasey Sheffer (26:29): There could be times when it becomes a discussion point because obviously the goal is to align. We want to make sure that if you’re a customer or shopper in any one of the sister companies that you would be experiencing the same type of product under the same label, let’s say if that’s under Nature’s Promise. So we do want to align and really that’s the purpose of my company, which is Retail Business Services, because our job is to find ways to leverage synergy and scale. We do what we can to make sure that our portfolio is operating across all the companies versus doing things independently.

Jessica Hughes (27:07): So do you ever find that, let’s say, I’ll go back to the coffee rub example just because it’s there, but you put it under Nature’s Promise, but Hannaford’s puts it under Taste of Inspiration. Does that ever happen?

Kasey Sheffer (27:18): No, we really do try to align.

Jessica Hughes (27:20): So it has to be consistent.

Kasey Sheffer (27:21): Yeah. And our team, while I have my portion of the team that supports the Giant Company solely, I also have counterparts that have similar teams across the various sister companies, Food Lion, Hannaford, Stop & Shop. So all of those peer groups work together because as they work together, they work smarter, not harder. So if someone has a terrific idea out of Hannaford, they will share that idea with their peer group, it’s now East Coast, so as they develop the item and bring it from idea to shelf for the other brands, it becomes as easy as them saying, “I will also carry that item. So once you develop it, I would be more than happy to put it in my planigram and sell it as well.” So we really do work as a collective team, private brands team, versus independently going our own way.

Jessica Hughes (28:09): Which also poses its own management obstacles and challenges because you’re not just managing your own team and also reporting for your own team, but you’re also partnering with all these other people that have a voice in what you’re doing.

Kasey Sheffer (28:22): Yep. I have three direct peers and one of whom who oversees the Stop & Shop company, he and I are on the phone all the time because we share 100% of our portfolio is shared across the board, and so we’re constantly making decisions collectively because our business is 100% shared. Yes, we need to lean on each other, we need to communicate quite frequently, we need to know what’s important to our customer, which again, for me is the Giant Company, so that as we turn that back into processes or procedures for the private brands team wholistically, we’re representing those needs and influencing the decisions that come out of the private brands team at large.

So yeah, very connected, in touch all the time. The way in which the private brands team operates requires as much time commitment effort as it does to manage the business for the Giant Company.

Jessica Hughes (29:21): It’s insane.

Kasey Sheffer (29:22): Yeah. It’s fun. It’s a fun job.

Jessica Hughes (29:24): I’m sure it is, especially the product development and having all the new ideas and being able to test all the new ideas, has got to be a lot of fun.

Kasey Sheffer (29:32): Yeah. And it doesn’t end there. I mean, the basics of our business is making sure we have product on the shelf to sell on and this environment more than any other, with our… We work with several hundred suppliers and making sure we understand where they’re at at any given point in time during a pandemic to protect our supply chain has really required hands on prioritizing that side of the business because if you don’t have product on the shelf, you cannot satisfy your customer. And so more than ever, that’s become, what used to be fundamental to our business and always the most important thing to have product there, in this environment is requiring a lot more time and effort in order to protect that than ever before.

Jessica Hughes (30:17): Talk about management challenges.

Kasey Sheffer (30:19): For sure.

Jessica Hughes (30:21): Well, thank you so much, Kasey. I really appreciate it. Is there anything else you want to add?

Kasey Sheffer (30:24): No. Thanks for having me. Appreciate it.

Jessica Hughes (30:49): Any time. Thank you so much.

If you’d like to learn more from Kasey, you can find her on LinkedIn and you can also follow the Giant Company on all different platforms depending on what you’re looking for from them. So be sure to check that out.

Well, that’s it for today. Thank you so much and as always, every meal is better shared. Feel free to share a Fork & Lens with your team colleagues and friends. If you’ve enjoyed today’s message, please subscribe to get weekly access to new recipes for creative and marketing success. Also leave us a review on iTunes. We really appreciate those. You can also check us out at forkandlens.co or viscal.co. Until next time.