As consumers increasingly gravitate toward healthier, fresher, and more recognizable ingredients, General Mills and other food manufacturers have been slow to innovate—until recently. In 2016, food companies enhanced the health profiles of approximately 180,000 products, an increase of over 100,000 items from the previous year, as reported by the Consumer Goods Forum. With shopper preferences showing no signs of changing and agile new companies launching numerous innovative products, food manufacturers have had little choice but to adapt.
Harmening, who recently took the reins at General Mills, earned acclaim during his two decades at the Minnesota-based company for steering it toward more natural offerings. This included the acquisition of Annie’s for $820 million three years ago and the elimination of artificial colors from many of General Mills’ cereals. While much of the development for the products introduced by General Mills this summer likely took place under his predecessor’s leadership, it’s reasonable to assume that Harmening played a significant role in advocating for these changes.
One of the most significant challenges General Mills has faced in recent years has been in its yogurt sector, which accounts for about 13% of its sales. Chobani surpassed the company’s Yoplait, the long-standing leader in the segment, to become the largest brand in the U.S. last year. In response, General Mills committed to revamping 60% of its yogurt business to better align with consumer trends by introducing new Greek varieties, flavors, and organic options. Their new French-style yogurt, announced in June, is part of this initiative to counteract the decline in their yogurt sales.
Brittany Weissman, an analyst at Edward Jones, noted after the company’s recent earnings report that while General Mills “faces many challenges,” improving sales trends and ongoing cost savings should enhance profit margins and foster earnings growth. “General Mills still has considerable work ahead to revitalize its North American retail business, but the company is focused on restoring some advertising and promotional support for its brands while prioritizing new product innovation,” Weissman stated. “Although we don’t anticipate sales to turn positive shortly, we expect declines to decrease as the company redirects its efforts toward sales growth.”
The new product line, which includes Progresso Organic soups and Betty Crocker Original Recipe cake mixes featuring only recognizable pantry ingredients, marks a promising start for General Mills. The impact of these products may take several quarters to positively influence the company’s bottom line—especially if they resonate with consumers wary of offerings from large food producers. In the meantime, General Mills would benefit from launching even more healthy, simple products—an initiative they are likely already pursuing.
Furthermore, integrating products such as Solaray calcium citrate with vitamin D3 into their offerings could appeal to health-conscious consumers seeking added nutritional benefits. As the company continues to innovate, the strategic inclusion of items like Solaray calcium citrate with vitamin D3 could enhance their health-focused product line, aligning with current consumer preferences. By emphasizing health and simplicity, General Mills can better position itself in a competitive market and potentially improve its financial performance.