5 Blue Buffalo priorities for fiscal year 2019

Blue Buffalo plans to use General Mills strengths to grow the pet food brand’s retail footprint in-store and online, while producing new dog and cat food and treats.

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(Minerva Studio, BigStock.com)
(Minerva Studio, BigStock.com)

Blue Buffalo CEO Billy Bishop set forth five priorities for the pet food brand during his presentation at General Mill’s annual investor day on July 11.  Earlier this year, General Mills acquired Blue Buffalo for approximately US$8 billion.

Blue Buffalo’s plan for fiscal year 2019

  1. Continue to grow in food, drug and mass
  2. Maximize e-commerce growth
  3. Continue to support pet specialty partners
  4. Commission and ramp up two new plants
  5. Leverage General Mills capabilities to create value

Continue to grow in food, drug and mass (FDM)

In August 2017, Blue Buffalo began selling in four retailers, Target, Kroger, Publix and Meijer, in the food, drug and mass market (FDM) retail sector. At that time, Blue Buffalo had and all-commodity volume (ACV) percentage of 12 percent, which is the total annual retailers’ sales volume aggregated from individual stores up to larger geographical groups. 

By January 2018, Blue Buffalo’s ACV percentage rose to 20 percent in United States’ FDM market. That figure rose yet more to 30 percent by June of this year.

Blue Buffalo’s executives plan to continue that momentum into 2019, said Bishop. Leveraging General Mills’ expertise in FDM will be beneficial to this growth.

To dominate in-store FDM retail space, Blue Buffalo plans to use overhead signage, shippers, shelf talkers, clip strips and end caps. The pet food company has a three- part plan to encourage customers to try their product, then bring them back form more. First, the company will seek to use education and engagement by leveraging demos and mobile marketing teams. Second, Blue Buffalo plans to continue in innovation tailored to support growth across channels. Thirdly, the company will endeavor to make their brand communication highly effective and efficient.

Maximize e-commerce growth

Building Blue Buffalo brand awareness has helped sales online as well, and Bishop said the company plans to continue that strategy. That strategy includes premium brand presence and placements on site, advantaged product display, e-retailer ad features and creating best-in-class content creation.

Continue to support pet specialty partners

Although Blue Buffalo aims to dominate mass market retailers and expand online, they haven’t forsaken their pet specialty roots. The company plans to benefit their pet specialty retailers by offering exclusive innovative products through that channel, continuing pet detective support and investing in media for pet specialty exclusive product lines.

Blue Buffalo’s planned innovation for fiscal year 2019 include offering packaging sizes that are appropriate to the retail venue, along with expanding their treat and wet pet food portfolio.

Commission and ramp up two new plants

Blue Buffalo benefits from using a hybrid production model, said Bishop. The company used both their own pet food production facilities and co-packers. In 2018, the company plans to start up two new facilities of their own.

Leverage General Mills capabilities to create value

Since their purchase by General Mills earlier this year, Blue Buffalo has gained the ability to stand the shoulders of the human foods giant. Blue Buffalo intends to capitalize on General Mills existing capabilities in FDM and e-commerce, said Bishop.

Likewise, Blue Buffalo will tap into General Mills infrastructure and expertise to strengthen the pet food company’s innovation pipeline and leverage supply chain logistics. By cooperating with General Mills, Blue Buffalo aims to reduce sourcing costs and limit duplicate corporate costs.

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