SECTION 2
Value Creation at the Calbee Group
The Calbee Group has its eye on the future and strives to contribute to healthy lifestyles. To make this possible, it will make use of strengths it has cultivated to date, and take on the challenge of creating new value from food. We are hard at work strengthening our core domestic businesses, expanding them to the global stage, while also
New
Market
Existing
Existing
Calbee Report 2022
Global Penetration of | Creating New Value Centered | |||||||
2 Brand Value | 4 on Customers' Issues | |||||||
Deepening Core | Sweet Potato Business | |||||||
1 Business in Japan | 3 Utilizing Potato Expertise | |||||||
Domains | ||||||||
New |
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expanding into new areas, driven by knowledge and technology related to natural ingredients.
Cultivated Strengths
Product planning and development capabilities
aligned with the changing times and diverse needs
Expertise in potatoes
and other ingredients
Processing technology
that utilizes natural ingredients
We are one step ahead of the needs of the times, creating new value through products such as the highly nutritious Kappa Ebisen, the easy-to-carry,cup-shapedJagarico, and the Frugra, a healthy and time-saving breakfast option.
In addition to increasing the sales of potato chips, we have also developed a system alongside producers for planting, cultivat- ing, procuring, and storing potatoes. We intend to apply this expertise to sweet potatoes and other natural ingredients.
Our processing and seasoning techniques bring together natural ingredients that differ by season or variety to unlock their true goodness and deliver food with an appearance, flavor, aroma, texture, and other qualities that deliver a kind of "taste" that appeals to the five senses.
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Value Creation Story - Creating the Future of Food1
Deepening Core Business in Japan
Advance marketing activities that are created together with customers
The Japanese snack market used to favor large-volume,value-for-money snacks, but now customers are seeking more diversified products, including highly portable and healthy items. At the same time, digitalization and the use of social media are advancing, and customers are now rationally selecting products and services based on information that they themselves have sought out. In this context, we at the Calbee Group need to change our approach from one where we simply provide information to customers to one where we try to create touchpoints, and work together with customers to create new products and services.
We have mainly two touchpoints with customers. First, the retail storefront remains an important touch- point that connects Calbee with our customers. We aim to create striking products and to propose attractive sales displays to retailers so that customers will continue to pick up our products from the shelf.
The second is direct contact with customers through digital means. Through the Calbee "Lbee" Program, we sometimes directly ask individual customers what made them buy our products. With the evolution of digital technology, we believe it is important to evolve marketing activity from the era of mass communication and "majority rule" through understanding our customers more deeply on an individual basis and creating new value.
Design products/services by imagining the customer's lifestyle and eating scenarios
Customers' eating habits are diversifying away from traditional mealtimes and snacking. In snacks and cere- als, not limited to existing needs for snacking or breakfast, we are now developing products based on "food labels," a platform for categorizing eating scenarios in a typical day. Snacks and cereals are used for a variety of purposes. For example, what kind of product is sought by customers who are snacking for a change of pace? Or what kind of product is required for a quick meal at home? An example of the shift in eating patterns is how the pandemic has increased the amount of time people spend drinking at home. In response to the increased demand for snacks, we are expanding Otsumami-Jagarico, the range of Kappa Ebisen flavors that go well with alcoholic beverages. In addition, the need for products with zippers and portability has been rising and we are expanding our lineup of products in easily portable packaging.
Calbee Report 2022
Tomoyuki Matsumoto
Executive Officer,
General Manager, Marketing Division,
Calbee, Inc.
Mr. Matsumoto joined Calbee in 1994. After a career in sales, sales planning, and product planning for potato chips and Kataage Potato (Kettle Chips), he became the general manager of the marketing department where he developed and implemented strategies. He assumed his current position in April 2019.
Overview of food labels*
Eating in | Eating out | |||||||||
Meal replacement | ||||||||||
Meals | Meal replacement and snacking | and snacking | ||||||||
Meals | ||||||||||
- Food labels are based on our own research and analysis to identify the diverse eating patterns of today's consumers, which we have categorized into 13 types.
Demand for snacks | Portability |
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Value Creation Story - Creating the Future of Food 1 Deepening Core Business in Japan
Product planning and development that makes full use of natural ingredients, starting from raw materials
Our products are made by processing natural ingredients in such a way that they can be enjoyed for a long time. For this reason, the use of high-quality natural ingredients, as they are, is at the heart of our manufacturing process. When we develop and market new products, we collaborate with our Procurement and Research & Development Departments and consider the quality and quantity of the raw materials. We employed this process in 2021 when we developed and launched a non-fried product called Frutz made with strawberries and oranges as new natural ingredients. In addition to the expertise we have developed over the years in potatoes, we are also enhancing our knowledge of raw materials such as oats for cereals, fava beans for miino, and fruits, while exploring new production methods that are suited to the ingredients.
Our major product, Kappa Ebisen, was launched in 1964 but remains a long seller loved by many as we continue to refine its strengths. We are also taking on the challenge of appealing to health-conscious consumers by using beans, as in the case of miino, launched in 2018. miino is enjoyed for its natural deliciousness by everyone from young people to older customers.
Calbee Report 2022
Enhance cereal business growth by appealing to the health value
Yumiko Aboshi
Brand Manager,
Oats Team,
Marketing Division,
Calbee, Inc.
Since entering the cereal business in 1988, we have focused on the delicious taste and health benefits of oats, and have mainly developed granola products. In April 2022, we launched a new oatmeal product, Baked Oats. The Calbee Group is one of the largest users of oats in Japan. We aim to grow our cereal business by maximizing the taste and health value of oats with our unique technology. In September 2022, we also launched Japan's first functional cereal* with a postprandial blood glucose control label under our Frugra brand. We will continue to improve the health value of Frugra to meet growing health needs, while evolving its quality and taste to meet consumers' lifestyle values.
- The first functional food cereal for moderating increases in blood glucose levels (Calbee survey, March 2022).
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By refining our long-selling products and constantly taking on new challenges, we hope to increase their lifetime value as products that have always been chosen by customers.
Nutrition Facts Comparison
(Content per 100g of raw material)
Units: Dietary fiber Protein (g) Iron (mg)
13.7 | |||||
9.4 | 7.9 6.7 | ||||
6.8 | 6.1 | ||||
3.9 | 3 | 2.1 | |||
1.1 | |||||
0.5 | 0.8 | ||||
Oats | Brown rice | Pressed barley | White rice |
Source: Standard Tables of Food Composition in Japan, 2020 edition (8th revision)
Baked Oats, oatmeal that does not require cooking
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Value Creation Story - Creating the Future of Food 2
Global Penetration of Brand Value
Providing new food value in global markets
The new food value that we will provide in global markets is delivering new flavors and enjoyment that has not previously been available by leveraging the strengths that Calbee has hitherto cultivated in Japan, and by consolidating the power of Calbee as a whole. The strength of the Calbee Group lies in its products, which deliver great taste and fun. We intend to accelerate the development of overseas business by leveraging the strengths cultivated in our Japanese business, including R&D and manufacturing technologies that make the best use of natural ingredients, and product planning capabilities.
Overseas business development to date and future strategy
Looking back on the Calbee Group's overseas business development, we have begun operations in many countries and regions mainly through joint ventures with local partners under our localization strategy, and have developed products that meet local needs. While we have created several hit products in various areas and steadily increased overseas sales, we have also withdrawn from or changed our business structure in regions where we were unable to achieve sales growth or profitability. About 10 years have passed since we embarked on the full-scale development of our overseas business, and we operate in nine countries and regions, including North America and Greater China. In recent years, we believe we have established a solid business foundation in each region through M&A of local manufacturers.
However, we have not been able to fully utilize our strengths in some regions due to our focus on localization strategy. The challenge for our overseas business going forward will be how to communicate the appeal and value of our products to global markets while being true to our strengths and also taking into account regional characteristics.
In terms of regional characteristics, in Greater China awareness of Calbee has spread to a certain extent due to inbound tourism to Japan, and the rapid development of e-commerce in recent years has also helped to significantly increase demand. We are currently focusing on exporting from Japan and leveraging trust in the "Made in Japan" brand. In the future, we will utilize our production and OEM bases in Thailand, Indonesia, and other ASEAN countries, which provide cost advantages and help secure a stable supply, to develop our
Calbee Report 2022
Keiei Sho
Managing Executive Officer,
President, Calbee Overseas Company,
Calbee, Inc.
Joined Calbee in 2013 after a career at a major Japanese general trading company, and, since 2016, has overseen the entire overseas business division, including North America and Europe. He assumed his current position in April 2020.
Product advertisement in Greater China featuring the top artist.
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Value Creation Story - Creating the Future of Food 2 Global Penetration of Brand Value
production foundation and increase our product lineup. At the same time, we will proactively invest in promotion activities to encourage the value of our products and awareness of the Calbee brand. In Europe and the U.S., we have been focusing on increasing brand awareness through emphasizing health-conscious snacks, we must also leverage assets acquired through M&A to communicate the value of Calbee. We will work to establish the Calbee brand widely by adding local brands in addition to the global brand.
Global brands include Jagabee and Jagarico, which feature a unique texture created through Calbee's differentiated technologies; Harvest Snaps, which have been established as a Better For You snack brand in Europe, the U.S. and Australia; and Frugra, which is being promoted as a new type of breakfast food mainly in Greater China. It will require patient investment from a medium- to long-term perspective for these products to take root in local markets.
The most important resource for promoting global expansion over the medium- to long-term is the people who will drive it forward. Calbee strategically allocates human resources with knowledge of Calbee's Japan operations in the R&D, marketing, and production technology value chains so that this knowledge can be shared with local markets. We also prioritize the development of our employees to ensure that they have a global mindset.
Overseas snacks market and Calbee group business operation
(GDP per capita, U.S. dollars) * The size of the circle is the snack market size.
United States
80,000
Singapore | ||||||||||||
60,000 | Australia | |||||||||||
Hong Kong | United Kingdom | |||||||||||
40,000 | South Korea | Japan | ||||||||||
China | Mature market with high snack consumption | |||||||||||
20,000 | Growing market where snack consumption is expected | |||||||||||
Indonesia | to increase in the future | |||||||||||
Thailand | ||||||||||||
0 | ||||||||||||
20 | 40 | 60 | 80 | 100 | 120 | 140 | 160 | 180 | 200 |
(Snack consumption per capita) Source: (Snack market) Euromonitor, Savoury Snacks, 2021
Calbee Report 2022
Snacks on display in an ethnic foods section | Harvest Snaps on display in a vegetable section |
(North America) | (North America) |
History of Calbee Group's overseas expansion
1970s | 1970: Entered the North American market | |
1980s | 1980: Entered the Thai market | |
1990s | 1994: Entered the Hong Kong market | |
2000s | 2002: Established a manufacturing subsidiary in China | |
2010s | 2011: Entered the South Korean market | |
2012: Established | Calbee (Hangzhou) Foods Co., Ltd. | |
2013: Entered the Indonesian market | ||
2014: Entered | the UK market | |
Established a joint venture company in the Philippines | ||
2015: Consolidated sales subsidiary in Singapore | ||
Established a sales subsidiary in Spain | ||
Established a sales subsidiary in China | ||
Conducted transfer of equity interest for Calbee (Hangzhou) Foods Co., Ltd. | ||
2016: Established a sales subsidiary in Australia | ||
2017: Established a production base in Malaysia (equity method) | ||
Dissolved and liquidated sales subsidiary in Spain | ||
2018: Conducted transfer of shares for joint venture company in the Philippines | ||
Acquired Seabrook, UK | ||
2019: Acquired Warnock, USA |
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Calbee Inc. published this content on 19 October 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 21 October 2022 07:19:03 UTC.