While Mars is best known for candies such as M&M’s and pet food brands like Pedigree, a big part of its future growth will come from an often-overlooked category: meals consumed at home.
Mars Food & Nutrition, a segment of Mars, consists of brands such as Ben’s Original, ready-to-eat Indian-based meals from Tasty Bite and clean-label meals and sides from Kevin’s Natural Foods, provides a small portion of sales at the company with more than $45 billion in annual revenue.
The privately held business doesn’t disclose sales figures for Mars Food & Nutrition, but executives said the categories its brands are present in are posting double-digit growth each year. It’s a pace the company doesn’t see easing anytime soon due to rising consumer interest in convenience, health and wellness as well as global cuisines — all categories that Mars Food has a heavy presence in.
“We’re quite confident that growth is likely to continue,” Denis Yarotskiy, Mars Food & Nutrition’s president for North America, told Food Dive. “The potential of this business is quite, quite significant.”
Denis Yarotskiy, Mars Food & Nutrition’s president for North America
Permission granted by Mars Food & Nutrition
The confidence stems from $1 billion in untapped growth its brands have yet to tap into, according to Mars Food & Nutrition executives. The company is optimistic their business can capture more than 50% of that market within the next decade.
Its rice brand, Ben’s Original, for example, has a microwavable rice bowl that only 30% of people have tried. With more people looking to incorporate convenience into their lives, products like this have “huge potential for the upside,” according to Kristin Campos, a vice president of corporate affairs at Mars Food North America.
Similar potential lies within Tasty Bite, its Indian food platform. The brand not only caters to surging interest in Indian fare but it builds off of the convenience theme by making authentic-tasting food that is easy to prepare in the microwave. Mars Food noted that the number of people who dine out at Indian restaurants is about six times larger than the percentage of people who prepare those meals at home, a gap they’re convinced Tasty Bite can help close.
The Mars Food and Nutrition division benefits from the fact that Mars allows it to run independently, Yarotskiy noted. Doing so allows the business to focus its attention on innovating and understanding the people who consume its foods for lunch or dinner — a focus that trickles down into faster growth and an acceleration in sales.
“It’s not a secret that we’re smaller than our second sister segments,” Yarotskiy said. “That’s why, for us, it would be way more difficult to find a share of resources if we were part of a much larger segment.”
Mars Food has been slowly expanding its portfolio, which is heavily focused on rice, through acquisitions. Last July, Mars announced it would buy Kevin’s Natural Foods, a maker of chef-inspired sous-vide meals, sides and sauces using whole foods and simple ingredients.
Yarotskiy said Mars Food is scouring the market for potential deals in on-trend, high-growth categories. The company is primarily targeting foods that are healthy, nutritious and easy to consume and prepare.
With Mars Food already growing rapidly, it can afford to be patient. Lately, a major obstacle for deal-making has been high multiples being attached to potential targets.
“It’s very difficult to find something that you can really create value with, and that can contribute to your purpose, to your vision of the category,” Yarotskiy noted. “That’s why it’s not happening every year that we go with an acquisition.”
