Premier Foods: A recipe for revitalising old food brands?

Premier Foods, which has just appointed Starcom to handle its 26m consolidated media-planning and buying account (MW last week), has had a busy three years since floating on the stock market in 2004.

soupPremier Foods, which has just appointed Starcom to handle its £26m consolidated media-planning and buying account (MW last week), has had a busy three years since floating on the stock market in 2004.

The company has been on an acquisition spree that has seen it add several famous British brands, such as Campbell’s Soup and Fray Bentos, to a portfolio that already included Branston, Mr Kipling, Crosse & Blackwell and Ambrosia. Earlier this year, Premier picked up the most ambitious item on its shopping list when it acquired RHM for £1.2bn, making it the largest food producer in the UK.

Following the merger, experts questioned whether it would be able to manage such a large number of brands, some of which had been rivals in the past. But, three years on from floating and seven months after integrating RHM, the feeling in the industry is that Premier has risen to the challenge.

Distinctive taste
Paul Cousins, of Cousins Davis Associates, says: “Premier’s biggest issue is managing the overlap of brands, ensuring there are clear distinctions and preventing brands from cannibalising each other. And they are very, very good at it.” One area of overlap is in the soup sector, where Premier owns Campbell’s and Batchelors. To address this issue, it has introduced the first non-powdered Batchelors soups, which the company says are popular in Ireland. Meanwhile, industry sources claim that a range of fresh, upmarket soups will be launched under the Campbell’s banner later this year. This approach is designed to give the consumer greater clarity on the different brand propositions.

Observers believe Premier has successfully revitalised many of the traditional and, in some cases, rather dull, British brands in its portfolio. It has introduced a range of beans and sauces under the Branston label, and expanded Ambrosia desserts into snack puddings and flavoured custards. The company is in a virtually unassailable position in the canned-milk-based desserts market, with more than 70% of market worth (Mintel).

Sources say several new products will be launched in the second half of 2007, including a seeded loaf variant in its Hovis range and a liquid version of Oxo. Such initiatives, supported by heavyweight advertising, should provide sales momentum. Premier currently retains five advertising agencies: DDB London, McCann Erickson, Publicis, Delaney Lund Knox Warren & Partners and CHI & Partners.

One cloud in Premier’s otherwise blue sky is the escalating cost of wheat, which has caused two price rises for Hovis-branded breads. Hovis was already struggling against stiff competition from Warburtons and ABF’s Kingsmill, and successive price rises have only added to its difficulties.

Premier chief executive Paul Schofield is closing six factories and cutting 600 jobs, prompting the Transport and General Workers Union to say: “Premier Foods is acting like a private equity company.” 

Fundraising efforts
But there is general approval of Schofield’s methods. Observers believe it is essential that he cuts waste and ditches old factories if Premier is to compete.

The company is on track to hit savings targets of £113m and the sale of RHM’s own-brand frozen food business appears to make sense for a company whose core competency is managing strong brands. The sale will also provide some funds, so new products and brand variants can be developed and some of the more tired brands in the portfolio reinvigorated.

Cousins concludes: “They have some fascinating issues ahead of them and based on what they have done so far, I can’t see why they won’t go from strength to strength.” 

Latest from Marketing Week


Access Marketing Week’s wealth of insight, analysis and opinion that will help you do your job better.

Register and receive the best content from the only UK title 100% dedicated to serving marketers' needs.

We’ll ask you just a few questions about what you do and where you work. The more we know about our visitors, the better and more relevant content we can provide for them. And, yes, knowing our audience better helps us find commercial partners too. Don't worry, we won't share your information with other parties, unless you give us permission to do so.

Register now


Our award winning editorial team (PPA Digital Brand of the Year) ask the big questions about the biggest issues on everything from strategy through to execution to help you navigate the fast moving modern marketing landscape.


From the opportunities and challenges of emerging technology to the need for greater effectiveness, from the challenge of measurement to building a marketing team fit for the future, we are your guide.


Information, inspiration and advice from the marketing world and beyond that will help you develop as a marketer and as a leader.

Having problems?

Contact us on +44 (0)20 7292 3703 or email

If you are looking for our Jobs site, please click here