Kraft Heinz's $600 million comeback plan hinges on marketing stunts that people will actually share

• A version of this post appears in the CMO Insider newsletter.
• You can sign up for Business Insider's weekly marketing newsletter here.

Kraft Heinz is rewriting its sports sponsorship playbook.

The food giant is deprioritizing the "logo slap" and leaning into quirky stunts, Todd Kaplan, Kraft Heinz North America's CMO, exclusively tells CMO Insider.

As the NFL Draft got underway in Heinz's hometown of Pittsburgh this month, the ketchup brand floated a barge with a giant billboard down the city's three rivers, counting down to each pick. The 57th selection — Logan Jones by the Chicago Bears — was gifted a ketchup-colored jacket and a lifetime supply of the condiment. Heinz hopes "Mr. 57" will become a new Draft tradition, a nod to its "57 varieties" slogan.

This stunt exemplifies the changing sports strategy of Kraft Heinz, which did a five-year deal to become the NFL's first-ever condiments partner this year.

"'Presented by Heinz' or an extra sign in the outfield, that's not the get for us," Kaplan told me.

In a landscape where sports fans scroll their phones during commercial breaks, skip ads on YouTube, or block ads altogether, marketers need to get creative about maximizing the value of their big sponsorship deals.

For Kraft Heinz, that means focusing on what Kaplan describes as "marketing that happens" — the type of content that's designed to be shared.

The company's Oscar Mayer brand is gearing up for its second "Wienie 500," where a fleet of hot-dog-shaped Wienermobiles will race around the Indianapolis Motor Speedway during the Indy 500 weekend in May. Last year's event was watched live by 8 million viewers online and drew 85,000 fans in person, Kraft Heinz said. The company said the race helped it sell half a million Oscar Mayer Wieners during Memorial Day, a four-year sales high.

Prior to the first Wienie 500, Oscar Mayer might have run an ad campaign and some trade marketing programs around Memorial Day weekend — one of the biggest moments on the calendar for hot dogs.

Now it has a "tentpole moment," Kaplan said.

For marketers, sports offer some of the last remaining mass-reach vehicles in media. Sponsorships can also impact consumer perception of brands. An analysis by the research company Nielsen of 100 sports partnerships between 2020 and 2021 found that sponsorships drove an average 10% lift in purchase intent — consumers' likelihood to buy a product or service — for the fans exposed to them.

Kraft Heinz has a $600 million turnaround plan

Kaplan's rejuvenated sports sponsorship approach is one element of a larger $600 million investment by Kraft Heinz in marketing, research, and other sales approaches to strengthen its brands and turn around sales declines, particularly in North America.

The business has been forced to confront changing consumer tastes around processed food and pressure on prices.

In February, Kraft Heinz paused a plan to separate its sauces, seasonings, and spreads division and its grocery store staples unit into two independent companies. Its stock has been lingering at six-year lows.

At the time Kraft Heinz announced the pause, its new CEO, Steve Cahillane, said previous cost-cutting had gone too far.

"It is clear that we have historically underinvested in our brands and in the business, resulting in persistent share loss over the last decade," Cahillane said on the company's February earnings call.

Behind the scenes, Kaplan said he's been working to eliminate formalities — like the back-and-forth of briefings and presentation meetings with its agencies — to get to the nugget of the best ideas faster.

It was in one of these brainstorming sessions that the Wienie 500 idea came about.

Kaplan said it required putting in the early work to ensure everyone, from legal to the brand teams and the media team, was all talking from the same sheet.

Kaplan has codified the process internally under the term "collaborativity."

"Most of the best ideas that have happened over time build on a text message or group chat," Kaplan said. "Creativity is iterative as a process — sometimes it can be messy."