Campbell Unveils Plans to Sell Broth in Russia and China

CAMDEN, N.J. -- Campbell Soup Co., based here, yesterday detailed its entry strategy and product plans for Russia and China, the world's two largest soup consumption markets.

Having already revitalized its core North American soup business and streamlined its international operations by selling its businesses in the United Kingdom and Ireland, Campbell is now widening its global focus to include the two soup markets with the highest growth potential. Soup consumption in Russia and China far surpasses that of the United States, where about 14 billion soup servings are eaten per year. In Russia, there are about 32 billion soup servings annually, or about 225 servings per capita, while in China, annual soup servings come to about 320 billion, or over 241 servings per capita -- in both countries, most of it homemade.

Campbell's entry into Russia and China expands the company's iconic brands within the simple meals and baked snacks categories and makes its products more widely available in existing and new markets.

"The soup markets of China and Russia represent an extraordinary opportunity for Campbell," said Campbell's president and c.e.o. Douglas R. Conant in a statement. "Soup is consumed in huge amounts in these countries, and Campbell is exceptionally qualified to lead the soup commercialization activity due to our unrivaled understanding of consumers' soup consumption behavior, innovative technology capabilities, supply chain excellence, and our superior marketing prowess within the simple meals category."

According to Conant: "We have invested the time and resources to understand each market, partnered with strong local companies, and developed delicious products that we believe will appeal to the unique tastes of the people in each country. Our timing is right. Income levels are rising in both countries, and consumers are increasingly time-pressed and seeking more convenient ways to prepare nourishing meals while maintaining their central role in family meal preparation. Campbell's new products can play a key role in minimizing the time it takes to prepare homemade soup, a staple of peoples' diets in both countries."

The company undertook extensive research and development in both markets and studied consumers' soup preparation practices and eating habits, including over 10,000 consumer interviews and thousands of household tests.

"During our immersion in the Russian and Chinese markets, we recognized that in order to convert homemade behavior, we would have to offer products that enabled the preparer to use them as foundations for their favorite recipes," noted Campbell International president Larry McWilliams.

In Russia, Campbell the company will introduce "Campbell's Domashnaya Klassika" ("Campbell's Home Classics") in chicken, beef, and mushroom varieties. The high-quality concentrated broths will contain chunks of chicken, beef, and mushroom, in addition to as vegetables. Packaged in portable pouches with Campbell's signature red and white iconic branding, the broths will roll out first in the Moscow region and will be available in stores in October 2007.

"Campbell's Domashnaya Klassika" is designed to save Russians up to an hour of preparation time when they make their own soups.

Bridgetown Foods, a baked snacks manufacturer with a national distribution network across Russia, will distribute the products.

In China, Campbell will bring out two varieties of broth under the "Swanson" brand: a clear chicken broth, and a classic "superior" broth made from a combination of chicken, Hainan ham, and pork. Both broths are made to be used in a wide range of Chinese cooking, including soup preparation, hot pot, braising vegetables, and preparing noodle dishes.

Both new broth recipes are made from all-natural ingredients, contain no added MSG, and are 97 percent fat free.

Campbell has been selling "Swanson" broth in Hong Kong for over 20 years. The company will employ the Swanson branding and aseptic packaging for the new broths.

The company plans to roll out the broths in early October in five cities in the Guandong Province: Guangzhou, Shenzen, Donguan, Zhongshan, and Foshan. These cities have a total population of about 32 million.

Swire Beverages, Coca-Cola's largest bottling partner in China, will distribute the products.

Campbell will launch comprehensive marketing plans in each market to support the new products, including broadcast, print, and Internet advertising, as well as in-store promotions and sampling programs. To educate consumers about how to use the broths in meal preparation and the products' benefits, the company will provide 1.7 million samples and recipe booklets in the Moscow area and about 10 million samples and recipe booklets in China.

Campbell has a portfolio of market-leading brands, among them "Campbell's," "Pepperidge Farm," "Arnott's," "V8," and "Godiva."
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