Hormel, the company that brought Spam to your dinner table, is dabbling in a new food: peanut butter. Hormel bought the Skippy brand from Unilever in an attempt to seize market opportunities in China.
Peanut Butter in China, Will it Really Be a Hit?
According to Yahoo! News, the company wants to sell more peanut better in China, which the company admits isn’t a hot commodity in the country. In some of the more affluent and developed areas, peanut butter is sometimes used on toast, but that’s about it.
While no market data exists on the consumption of peanut butter in China, the company says they are eager to take on the challenge. Hormel has also indicated they would like to sell Spam in China as well.
The CEO says the company could use the “ready-made” idea in its future promotions of Skippy.
“That concept of taking Skippy out of the jar echoes a similar concept we’re trying with taking Spam out of the can,” CEO Jeffrey Ettinger said in an interview.
Peanut butter might not rock the taste buds of those in China, but peanuts and peanut oil are a big part of the diet.
Hormel will shell out $700 million for the peanut butter brand.
Hormel Projects Hefty Peanut Butter Sales
Hormel expects annual Skippy sales of about $370 million, with almost $100 million of
that from outside the U.S., according to Tampa Bay Online. Last year Unilever made it known they were interested in selling the peanut butter brand as part of a restructuring process. Unilever, which is based in the United Kingdom, sells Dove soaps and Lipton teas.
Your Thoughts?
What are your thoughts about this acquisition? Will peanut butter be a hit in China? Or does the company have its sights set a bit high?
