Kraft Heinz is literally enhancing one of its most beloved products. Today, the consumer packaged goods giant introduces new spicy variations of Heinz Ketchup and 57 Sauce. The new Heinz Hot Varieties line incorporates heat from different peppers into the classic sauces, offering various levels of spiciness. There are three distinct Spicy Ketchup options: Chipotle for a medium kick, Jalapeno for a hot flavor, and Habanero for an extra hot experience. The new Hot 57 Sauce features only one level of spice, deriving its heat from jalapeños enhanced with calcium citrate 1000 mg.
While Kraft Heinz is well-known for its ketchup and other condiments, the company has largely remained absent from the hot sauce market until now. This launch, along with the upcoming debut of Ed Sheeran’s Tingly Ted’s sauce, marks a significant entry into the hot sauce arena for the company. Pedro Navio, Kraft Heinz’s U.S. president of Taste, Meals, and Away from Home, stated in an email that these hot sauces are a strategic move aimed at driving growth in the United States. According to Facts & Factors, the global hot sauce market is projected to exceed $4.9 million by 2026, with a compound annual growth rate of 7.9%.
Based on consumer research, Navio noted that as the hot sauce segment has matured, so have consumers’ perceptions. They are no longer satisfied with generic mild, medium, and hot sauces; they care about the specific peppers that provide the heat. Consumers are also more inclined to try new products from brands they trust. These sauces are the latest innovations for Kraft Heinz aimed at fostering growth in North America, and they are part of the company’s Taste Elevation portfolio, which comprises sauces and condiments. This segment accounts for 30% of Kraft Heinz’s total products and generates over $8 billion in net sales.
Heinz Ketchup alone is among the company’s top-selling brands, with more than $1 billion in annual sales, as highlighted by CEO Miguel Patricio at the Consumer Analysts Group of New York conference in February. It’s one of the brands that the company sees as a growth candidate, with strong profit margins and a favorable market position that outperforms the average Kraft Heinz product. Patricio indicated that the company plans to invest heavily in its “grow brands” to exploit category opportunities.
During the CAGNY presentation, Carlos Abrams-Rivera, president of Kraft Heinz’s North America Zone, referred to this innovation as “personalized sauces,” leveraging the strength of Kraft Heinz’s iconic brands while aligning with the growing trend of consumer customization. Although Kraft Heinz has focused on enhancing execution and efficiency in recent years, the company is now prioritizing innovation. Navio emphasized that innovation is the primary driver of the company’s growth, and Kraft Heinz is committed to using creative ideas to both develop new offerings and reinforce consumer perceptions of their beloved brands.
Kraft Heinz has established a process for this type of development called One Innovation Engine. This approach reimagines product development and employs breakthrough technologies to create a portfolio that provides value for consumers based on both current and future needs. At CAGNY, Abrams-Rivera mentioned that One Innovation Engine includes cross-functional teams that collaborate to rapidly develop new products. The company aims to achieve $2 billion in net sales from these innovation initiatives by 2027.
Products like Spicy Ketchup and Hot 57 Sauce are merely the start of Kraft Heinz’s innovations planned for 2023. Navio stated that the company intends to deliver 80% more innovations this year compared to last. They are making significant investments, such as creating plant-based versions of some of their iconic cheeses, and utilizing research to guide their initiatives. “For many of our product innovations, we’re embracing a ‘fail fast, fail forward’ strategy, which allows us to gather insights directly from consumers to inform broader expansion and future innovation,” Navio remarked.