Big Food Industry Aims to Reset Its Narrative at CAGNY Conference
Major food companies are seeking to reshape their image in the face of investor dissatisfaction and consumer resistance to rising prices. The annual Consumer Analyst Group of New York (CAGNY) conference is at the forefront of this narrative reset for the industry. Taking place in Boca Raton, Florida, renowned food brands such as PepsiCo, Coca-Cola, Hershey’s, Conagra Brands, and Molson Coors are presenting at the event.
Volume Recovery Takes Center Stage
Americans are becoming increasingly cautious about expenditures due to soaring prices, particularly with respect to products such as chocolate. Consequently, the industry is placing a special focus on volume recovery. General Mills and Conagra executives expressed hesitation in predicting a return to growth in the near term. Analyst David Palmer from Evercore ISI noted executives at both companies were “hesitant to comment on whether [fiscal year] 2025 (beginning in June) could be a return to growth in line with long-term targets.”
Hamstrung by soaring prices, Hershey and Mondelēz are exploring strategies such as “price pack architecture” involving varying pack sizes and price points. Hershey CEO Michele Buck revealed that the company has maintained success by offering products at different price levels to enhance accessibility for consumers.
Innovation and marketing partnerships with new industry players have also taken the forefront as strategies for regaining consumer engagement. Hershey’s announcement of a partnership with NBA legend Shaquille O’Neal to dominate the fast-growing gummy segment garnered significant attention. Conagra Brands revealed the expansion of Dolly Parton’s baking line into frozen shelves, aiming to captivate consumers with new and inventive products.
Anticipating Mergers and Acquisitions
Rumors and discussion surrounding mergers and acquisitions (M&A) abound at the conference, alluding to potential shake-ups within the industry. Numerous companies have hinted at their willingness to enter into deals, waiting for the opportune moment and the right valuation.
However, anticipated M&A activity may not involve the traditional acquisition of competitors. Experts suggest that, similar to Walmart’s acquisition of Vizio, food staples companies may pursue differentiated tech companies to gain deeper consumer insights and understanding.
The narrative reset for the food industry at the CAGNY conference aims to address investor concerns, overcome consumer resistance to inflated prices, and showcase innovative strategies for sustained growth and profitability.
