Three years ago Birds Eye’s marketing was a mess with no clear brand vision. The frozen food category was deteriorating and the business was staring down the barrel of a steady 6% year-on-year decline when Steve Challouma took over as marketing director in 2016.
“Frozen food was quite a troubled category and had lost its way. Our brand was a huge part of the problem and we were dragging the sector down with us,” he explains.
The company’s marketing strategy was largely to blame. It had unified all its categories – fish, vegetables and chicken – under one campaign for the Birds Eye master brand.
“It was inefficient and meant our marketing became a bit bland. We had been looking so much at changes in consumer behaviour and appealing to that, that we lost focus on the things consumers buy day in and day out. Without caring for those areas they become leaky buckets because we weren’t replenishing.”
The business was bought by packaged food company Nomad Foods in 2015 for €2.6bn, and with the help of Challouma on marketing it has begun turning things around. In October, the company reported a sales increase of 2% for its 2017 financial year, compared to a decline of 3.9% the year before.
Challouma explains: “[The business] was in such decline and needed such a rethink as we’d created a bit of a burning platform. So when Nomad Foods took over we could look at what we really wanted to do and what we had to change.”
The context of the business has such a profound impact on the culture and the role of the brand.
Steve Challouma, Birds Eye
The process was broken down into defence and offence. Defence was the first step of Nomad Food’s vision and meant turning around the core business.
“As brand leader for fish fingers, which is our biggest category, we need to consistently make sure we have the best fish fingers. That is just as as important as launching into new areas.” Challouma says.
“It’s no good going out there and acquiring new brand businesses if you haven’t got your house in order. So we’ve had a period of defence in the last year to turn our brands around and that gives us the foundation to generate the cash flow to fuel and expand the business.”
The company now feels ready to launch stage two – offence. And it is doing that by expanding the business and has already made two major purchases this year: Goodfellas Pizza in January and Aunt Bessie’s in July.
The acquisitions mean Nomad will cover half the UK’s top 10 meal occasions, which will help “transform our scale in the freezer cabinet”. According to Challouma, Nomad will be 50% bigger as a result, nearly doubling retail sales from £480m to £700m, giving the company “broader credibility to be the leader in frozen and scale in the broader business value chain”.
He explains: “What we intend to do is attempt to apply our Birds Eye model. This means investing at scale to maximise reach and modernising the proposition to reignite consumers feelings towards the brand.”
Both new brands will get funding for new ad campaigns (Aunt Bessie’s to launch next month and Goodfellas in March) with significant marketing investment intended to awaken “the sleeping giants” .
Leading the business forward
Challouma is leading on both brands’ marketing strategies and says he has never felt more energised.
“I’ve grown up as a marketeer with Birds Eye and been through so many different histories, ownerships and strategies and to have an owner that’s so intentional about investing in brand is amazing. We’re now seeing the results of that and to suddenly be looking after new brands in new categories is very energising from a leadership point of view.”
Challouma might have been in the role 19 months but is a veteran of Birds Eye with over 20 years experience.
“One thing I have learnt is the context of the business has such a profound impact on the culture and the role of the brand,” he says.
For 76 years, the brand was owned by Unilever but as frozen food was not considered a key driver for the business. Challouma says the company “drove pretty low expectations”.
Frozen food was quite a troubled category and had lost its way. Our brand was a huge part of the problem and we were dragging the sector down with us.
Steve Challouma, Birds Eye
He explains: “You learn a lot because you’re within Unilever, which has world class marketing and academies but you’re a very small fish and feel insignificant within this global giant.”
In 2006, Unilever sold Birds Eye to private equity firm Permira for £1.2bn, a move which Challouma admits was “quite scary”.
“I didn’t know what to expect and it was a sharp learning curve. I had to really hone my skills as a more general business marketer whereas in Unilever it was more about purist brand development.”
Nomad Foods then acquired the company in 2015 and the marketer says it has the “perfect attitude”.
He explains: “The owners say they are not renters of brands, they’re owners and looking to build something for the long term. As a marketer that’s a brilliant place to be because you are looking to build something from scratch but you’re very empowered to drive your agenda.”