In November 2013, managers at H.J. Heinz Co. gathered their workers in the cafeteria from the company’s century-old plant in Leamington and broke some bad news.
The plant’s new owners – Berkshire Hathaway and Brazilian private equity finance firm 3G capital – had decided to shut the guarana plant down. It was unclear whether the small Southwestern Ontario town would get over such a crippling blow.
The plant had 740 full-time employees and 350 seasonal workers. The tomatoes it processed for Heinz taken into account 1 / 2 of Ontario’s $52 million crop. Devastated workers left the meeting in a hail of curses and tears, making panicked calls to realtors concerning the worth of their houses.
A few months later, a brand new company called Highbury Canco Corp. offered a reprieve. The company took over the plant and signed a letter of intent to continue processing tomatoes for Heinz – but not for ketchup, its former signature product, and not enough to keep a lot more than about one-third of the plant’s workers employed.
Little did Heinz know that 2 yrs later, lingering anger over its treatment of Leamington would play directly into both your hands of 1 of their biggest competitors.
In late 2014 to little fanfare, The French’s Food Co. LLC – best known for its mustard – started selling ketchup in supermarkets. Heinz hit back a few months later, ramping up distribution and marketing of their retail mustard: “For a long time, Heinz ketchup has been with the wrong mustard. Well, not anymore,” said the voiceover of the commercial released in April 2015.
Struggling to challenge Heinz’s market leadership, French’s rolled out a brand new marketing campaign positioning itself because the natural, local condiment alternative, free from additives, high fructose corn syrup and gluten. That included buying paste produced by Highbury Canco from tomatoes grown in Southwestern Ontario for its Canadian ketchup.
Today’s consumers, especially millennials, “want things local,” said French’s president Elliott Penner. “They don’t need to see stuff that they don’t know where they originated from.”
And boy, was he right. A minimum of if you’re counting likes and shares – and prepared to stretch the phrase “local.”
In January, a month after French’s starting sending out press releases touting that “working with local farmers in Ontario, French’s Ketchup has become made with 100% Canadian tomatoes,” the CBC bit and ran a tale about how Leamington tomatoes were being used for ketchup again. About 6 weeks later, a construction worker in Orillia discovered that story and wrote a viral Facebook post with 133,000 shares and counting, saying his family had chose to change to French’s: “Absolutely love it!! Bye. Bye. Heinz.”
When word got out last week that Loblaw Cos. Ltd. was pulling regular-flavoured French’s ketchup from stores, citing low sales, the atmosphere on social networking turned from love-in to lynch mob.
Yet another post went viral, a relevant video featuring an irate and heavily tattooed man waiting in front of the Loblaws store holding a bottle of French’s ketchup and vowing to never shop there again unless the company reverses its decision. “FRENCH’S are creating jobs for Canadians while Loblaws/Heinz take away jobs from Canadians.CALL AND COMPLAIN NOW !!” he wrote in a Facebook post accompanying the recording.