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Retail

Keurig Teams Up With Campbell Soup in First Foray Into Food

By Steve Wynne-Jones
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Keurig Teams Up With Campbell Soup in First Foray Into Food

Keurig Green Mountain, struggling with sluggish demand for its coffee pods and brewers, is looking for a pick-me-up from chicken soup.

The Waterbury, Vermont-based company is working with Campbell Soup to offer two varieties of soups in its K-Cup system: a homestyle chicken noodle and a Southwest-style chicken noodle. The products mark Keurig’s first foray into food, according to a statement on Wednesday.

Keurig is seeking new sources of growth after tepid sales of K-Cups and a slow rollout for its new cold-drink machine forced the company to cut its forecast last month. The dim outlook sent its shares plummeting, erasing more than $3 billion from Keurig’s market value in a single day. In the most recently reported quarter, the company’s pod sales fell 1.4 per cent to $815 million.

The soup partnership was announced in September 2013, but it took more than two years to develop the pod, said Amy Doyle, a Keurig spokeswoman. Over that time, the company has seen its once-galloping sales growth disappear. The hope is that soup will give customers another reason to use their machines beyond the morning caffeine fix.

Like Keurig, Campbell could use a boost. Sales at the company fell almost 9 per cent to $1.69 billion last quarter. Campbell and Keurig have overlapping customers, and the effort could be a way to spur demand for both brands.

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“We know more than 80 per cent of people who buy Keurig pods also buy Campbell’s soup,” said Michael Goodman, marketing director of innovation at the Camden, New Jersey-based soup company. “Bringing together two products people love in one handy kit is a winning idea.”

Bloomberg News, edited by ESM

 

 

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