Yoki fuels growth in Brazil
At the annual investor conference of the Consumer Analyst Group of New York (CAGNY), I had the opportunity to speak with Sean Walker, president of General Mills’ Latin America business. Sean traveled from Sao Paulo to give investors a closer look at our growing business in Brazil.
“The Yoki acquisition gave us a solid business in Brazil,” said Sean during his presentation yesterday. “We’re playing from a strong position, with trusted brands and nationwide infrastructure. We’re leveraging that infrastructure and bringing innovation and renovation to the brands to accelerate growth for this business.”
In 2012, General Mills acquired Yoki Alimentos, which allowed us to quickly enter the market with established and trusted food brands – Yoki and Kitano. These brands gave us access to large and growing food categories like salty snacks, convenient sides, seasonings, and beverages. Sales in these categories have been keeping pace with the broader packaged food industry.
Yoki’s brands have high awareness in Brazil. Household penetration of the Kitano brand is 70 percent, and it’s nearly 90 percent for the Yoki brand.
In the first 12 months under General Mills ownership, Yoki’s constant currency net sales grew by nearly 20 percent.
Sean spoke with me about why Brazil is such an exciting market for General Mills, where we are seeing strong growth today, and prospects for the future.
The growing middle class in emerging markets is one of four strategic consumer groups General Mills is prioritizing to drive faster topline growth.
Brazil has seen a surge in middle-class consumers, a segment that has increased by 20 percent between 2005 and 2012. More dual income households are emerging and consumers are living increasingly busy lives, which drives greater interest in convenience and snacking.
To accelerate growth in Brazil, the business has focused on improving distribution across categories, planning year-round in-store merchandising events like its successful Festa Junina, and sharpening marketing efforts.
For example, Yoki’s popcorn business has had recent success with its campaign “explosão de alegria” – translated roughly as “explosion of joy”. The campaign puts popcorn at the center of family together time.
Yoki is also driving new product innovation. In the past year, Yoki has introduced new Kit Fácil, which combines Yoki seasonings and side dishes into a convenient dinner kit. Think of it as a Brazilian version of Helper.
And there is a strong lineup of new products on the horizon, including a new line of co-branded Yoki and Betty Crocker baking mixes with Brazilian flavors.
Yoki also will launch new snacks with flavors inspired by the world’s top soccer teams including Argentinian Barbecue potato chips, Mexican Pepper peanuts and German Mustard microwave popcorn.