So you have not heard? Yes, Boar’s Head, the deli meat brand that makes lunchmeat is in the hummus business. In fact, it launched 10oz hummus tubs of regular hummus and roasted red pepper hummus in 2014 with tepid results. After all, who wouldn’t want to take a chunk of the $800 million hummus business?
The problem is that retailers across the country are overSKUed – fancy trade lingo for too many products on shelves. Besides the national brands of Sabra (owned by Pepsi), Tribe (owned by Nestle), Athenos (owned by Kraft), the retailers themselves have launched their own private label hummus. Apparently, this has not stopped Boar’s Head hummus to get a decent 20% distribution on some products across the retail landscape, and dollar sales nearing $10 million!
But this adjacent innovation – they are already in the refrigerated deli business in lunchmeats and condiments so why not round it out with hummus – does not have a point of different. As Clayton Christensen in “The Innovator’s Dilemna” asked, what is the job to be done by this product? It is plain hummus.
With Sabra cashing in at $450 million in sales last year, and Tribe far behind at $50 million, there really isn’t much room for an undifferentiated product.
It’s good to innovate and broaden one’s portfolio, even get into hot trending categories, but you need a point of difference, a “raison d’être” or someone’s going to eat your lunch (pun intended)!