More Consumers Are Seeking Solace in an Unlikely Quarantine Ingredient: Spam

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Key insight:

Three things have been happening since schools and nonessential businesses closed in March to help slow the spread of the novel coronavirus: First, people have been buying a lot of nonperishable packaged food items from big name brands they know and trust. Second, the number of Americans cooking at home and experimenting in the kitchen has increased. And third, due to newfound pressures on the supply chain, the nation is facing a meat shortage.

Each of these developments has proven particularly beneficial for Spam, the canned meat brand that debuted over 80 years ago.

Yesterday, parent company Hormel Foods Corporation reported net sales of $2.4 billion for its fiscal quarter ending April 26, marking a 3% increase compared to the same time last year. Its grocery division, which includes Spam, Skippy peanut butter and Hormel chili, saw net sales rise 8%.

“We expect the demand for Spam on a global basis to remain very strong,” said James Snee, CEO of Hormel Foods, in an earnings call with analysts on Thursday. He continued that for a brand that’s been available on store shelves for over 80 years, “it’s probably more relevant today than it’s ever been.”

Even prior to the pandemic, Spam was on a winning spree. The brand is on pace to have its sixth consecutive year of sales growth, according to Brian Lillis, senior brand manager at Spam.

Part of the reason behind Spam’s recent ascent, Lillis explained, is that popular recipes among people in the Asia Pacific region, where the brand experiences heavy usage, have gradually made their way to America. Filipino restaurants, especially, Lillis noted, have helped promote the idea of including Spam in various dishes.

“As we’ve had people moving into the country from those areas, they’ve brought with them those traditions that they’ve had growing up with the brand,” said Lillis.

In 2017, Spam debuted a new campaign by BBDO Minneapolis during the Super Bowl featuring a woman making fried rice using peas, carrots and Spam with the tagline, “Don’t knock it till you’ve fried it.”

The idea that consumers might “knock” the product implies that the brand is aware people have apprehensions. In an attempt to alleviate doubts and clear up misconceptions, Hormel Foods’ website features a page stating that, contrary to urban legend, Spam products don’t have an eternal shelf life (“There is, in fact, a limit to their goodness,” it reads). On Spam’s own website, the brand explains that the product consists of nothing more than six ingredients: pork with ham, salt, water, potato starch, sugar and sodium nitrite.

Regardless, the brand has more or less stuck to the marketing strategy of demonstrating how Spam can complement classic cuisines ever since it began during the Super Bowl in 2017. Last year, for example, the brand broadcast a 15-second spot on national TV and digital video showing how Spam goes well with Ramen. Earlier this week, the brand posted a short clip of Spam tacos along with a link to the recipe on Twitter.

Lillis added that throughout the pandemic, plenty of consumers have been posting their own Spam-inspired recipes on YouTube.

“It’s been great to see that there’s continued love for the brand out there,” he said.

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