What does Betty Crocker look like around the world?
Today in Boston, Chris O’Leary, executive vice president and chief operating officer – International, gave investors an overview on the company’s business abroad at the 2014 Barclays Back to School consumer conference.
A replay of the presentation will be available through the Investor Relations section of GeneralMills.com through Friday, September 12, 2014.
International expansion has been a significant source of growth for General Mills over the last five years.
Our sales outside the U.S. have almost doubled in size over that timeframe. Including our proportionate share of joint venture revenues, net sales for our international businesses totaled $6.6 billion in fiscal 2014, representing 35 percent of General Mills’ worldwide net sales.
While the company is focused on both developed and emerging markets businesses, Chris said the company expects its emerging market businesses to lead topline growth.
Europe is our largest region, with over $2 billion in net sales. Canada, Latin America, and Asia/Pacific each represent roughly $1 billion in net sales. Nearly 40 percent of our segment’s sales are in emerging markets.
One of our emerging markets is AMEA or the Asia, Middle East, and Africa region, the smallest of our emerging market businesses with just under $300 million in net sales.
“Sales in this region grew at just under 10 percent on a constant-currency basis last year, and we think its future growth prospects are terrific,” said Chris to investors today.
Our AMEA business is focused on three geographies: India, the Middle East and North Africa, and South Korea. Combined, these markets consist of over 1.7 billion consumers and generate $12.5 trillion in GDP.
During his presentation, Chris stated the emerging middle class is driving strong growth for packaged food in these markets. As these consumers’ disposable incomes grow, their eating habits are changing, with more demands for convenient, value-added products.
“Our primary focus in this region is on sweet snacking, where our Häagen-Dazs and Betty Crocker businesses have tremendous opportunity,” he said.
Betty Crocker’s popularity is growing in the Middle East.
In fact, the Middle East is the second largest Betty Crocker market in the world, after the U.S.
“This part of the world has a sweet tooth, and cake is a sweet snack loved by the entire family,” said Laurent Favreau, marketing director for the region. “Easy preparation, convenience and guaranteed results are the key reasons for the brand’s popularity.”
Since its arrival in the region in the 1960s, Betty Crocker has relied on a number of ways to promote its easy-to-make desserts.
This year, the brand launched a “30 Cakes for 30 Days” campaign to coincide with the Ramadan holiday. Though it’s a month of fasting from sunrise to sunset, it’s also a time when a lot of sweets get eaten after the sun sets.
“Ramadan is one of the highest consumption seasons for sweet desserts,” said Laurent.
The holiday is also time for larger and more frequent social gatherings, which leaves consumers scrambling for innovative recipes. Through the Betty Crocker website, the brand offered 30 recipe ideas to bake cakes for each day of the 30 days of Ramadan.
So, what Betty Crocker products are popular in the Middle East?
Betty Crocker’s Super Moist Cake mixes – Dark Chocolate, Milk Chocolate and French Vanilla – are top sellers. And lately, excitement has surrounded new Betty Crocker products, including two varieties of cheesecake – Strawberry and Blueberry – introduced in late 2012 – as well as Red Velvet and Caramel & Chocolate cake mixes that launched last October.
Betty Crocker partners with Yoki in Brazil.
Another emerging market region for General Mills is Latin America, where net sales in the region have more than doubled in two years, to more than $1 billion in 2014.
“The Yoki acquisition played a huge role in this transformation, giving us a strong platform for growth in Brazil,” Chris stated.
In Brazil, Betty Crocker’s baking know-how was just introduced to the region through a co-branded dessert mix with our Yoki brand.
The co-branded line of dessert mixes launched in conjunction with Festa Junina – Brazil’s early winter celebration where families eat a lot of cake.
Ranked second behind the U. S. in dessert consumption, Brazil is a country where cake – without frosting – is often eaten at breakfast.
The Betty Crocker Yoki dessert line-up includes cakes, brownies and cookies. There are chocolate, vanilla, and orange (known as Bolo de Laranja in Brazil) cakes, a brownie mix, and chocolate, vanilla and brownie cookie mixes.