At the Campbell Soup Co. headquarters in Camden, N.J., CEO Denise Morrison is taking me on a tour of the company store, where employees can buy products at a discount. Morrison breezes quickly past the items Campbell’s is best known for: the classic red-and-white cans of condensed tomato soup, Pepperidge Farm breads and Goldfish, and Prego spaghetti sauces. She wants to show me the perimeter of the store, where the refrigerated and fresh items are kept.
“One of the things that I’m so excited about–I love my food,” she says, opening the package of a new Campbell’s product, a squeezable tube of fruit puree and Greek yogurt. “Mom can freeze it and put it in the lunch box. It’s a better-for-you snack for kids that doesn’t exist in fresh.” Next, she points out a transparent bag of baby carrots, decorated with cartoon vegetables. “We have veggie snackers. These are pouches of carrots with seasoning–you shake it up and it tastes like ranch. Want to try it?”
I bite into a powder-covered carrot. “It tastes like a potato chip,” I offer.
“It crunches like a potato chip!” she exclaims delightedly, adding, “25 calories!”
As the head of one of the world’s largest food companies, Morrison has the job of applying the core DNA of a firm that sells 2 billion cans of Campbell’s soup each year to shifting American tastes, constantly searching for a new take on the notion of convenience food. Something, perhaps, like a potato-chip carrot. As anyone who has read a restaurant menu or walked the sprawling organic aisles of a supermarket knows, Americans are fixated on eating healthier–even if they don’t always follow through. For all the desire to eat fresh, working parents face the challenge of getting family dinner on the table.
So for Campbell’s to succeed, it must give parents foods that satisfy their idea of what’s healthy and appeal to the average kid without dirtying a dish. With every new kale-quinoa-Greek-yogurt trend, that task keeps getting harder. After 3½ years on the job, Morrison continues to contend with critics who lament Campbell’s lackluster stock price, even as the company posted better-than-expected earnings in its most recent quarterly report. Convenience food has typically meant processed food, so when Campbell’s starts “bringing those capabilities to the fresh space,” as Morrison puts it, what that really means is taking 145 years of experience with processing, branding and convenient packaging from cans and boxes and moving it to the produce aisle. Whether that’s brilliant or paradoxical depends on your perspective. But one thing is for sure: with Campbell’s products in more than 90% of U.S. households, Morrison’s plans are bound to affect the way Americans eat.
Into the Soup
The history of putting food into cans is, of course, largely a story of taking fresh items and preserving them. But Campbell’s became famous not for the vegetables it preserved but for the ingenious way it found to alter them. In 1897, an MIT-trained chemist at Campbell’s invented condensed soup by reducing the water content. Suddenly able to ship its soup more cheaply than its competitors, Campbell’s was selling 16 million cans of soup annually by 1904. (Heinz, its closest competitor, sold under a million.) The original condensed soups–cream of mushroom, tomato and chicken noodle–remain Campbell’s best-selling products.
But soup–still a source of about one-third of the company’s $8.3 billion in total revenue in 2014–has in a way become a victim of its own success. The same hunger for convenience that popularized meals from a can has driven more Americans to stop cooking altogether. Tonight, 58% of the main dishes eaten at home in the U.S. will be homemade–down from about 70% 30 years ago, according to Harry Balzer, a food analyst at the NPD Group. Balzer says the most popular dinner in America is a sandwich–good news for Campbell’s Pepperidge Farm line of breads but not for its core soup business, which does better when people actually cook. The company says sales of a condensed soup increase 70% among customers who download a recipe from the Campbell’s website that features it.
The challenges Campbell’s is facing are more complicated than cooking. Despite a boost from colder-than-average weather the past two winters, the company is wrestling with big changes, from consumer concerns about sodium (often high in processed foods) and shifts in the global market (China’s booming middle class is everyone’s next target) to competition from grocery-store private labels and rivals like General Mills. It’s not 1897 anymore.
Enter Denise Morrison. When Campbell’s appointed her CEO in 2011, Bloomberg Businessweek painted her as a company insider unlikely to deliver change. About that, the magazine was wrong. Morrison has made bold acquisitions in her 3½ years: a Danish cookie company popular in China, a millennial-baiting organic-baby-food company and–for a whopping $1.55 billion–Bolthouse Farms, the largest acquisition in the company’s history and the inventor of the potato-chip carrot.
What her critics didn’t consider is that Morrison, 61, has spent practically every minute of her life preparing to run a company like Campbell’s. The oldest of four daughters growing up in New Jersey in the 1960s, Morrison has wanted to be a CEO since she was little. Her father Dennis Sullivan, an executive at AT&T, thought it was important to prepare his daughters for a business world that was growing more open to women. At family dinners he talked with them about marketing strategies and new products–he was involved in the introduction of call waiting, and the family was one of the first to own a Princess Trimline phone. He taught basic business skills through childhood activities like negotiating over chores and identifying the target market when selling Girl Scout cookies (answer: the wealthiest homes with the most kids).
Morrison graduated from Boston College in 1975 with a degree in economics and psychology and started her career at Procter & Gamble. She worked at PepsiCo, Nestlé, Nabisco and Kraft before arriving at Campbell’s in 2003. As president of Campbell’s retail business in the U.S., she had some setbacks, according to Businessweek, including an advertising feud with Progresso over MSG in soup, which generated bad publicity for both brands, and a move to reduce sodium in soups that was so unpopular with customers that Campbell’s put most of the salt back in.
All four of those Sullivan girls grew up to have successful business careers, and two of them are now CEOs. Denise’s sister Maggie Wilderotter is CEO of Frontier Communications, a telecommunications company based in Connecticut. Though skeptics might gripe that the Campbell’s turnaround isn’t moving fast enough, Wilderotter says her sister is at her best with a challenge. “We grew up in an environment where we would get the highest level of satisfaction from doing things people never expected us to pull off,” she says. “So being in a situation of transformation, disruption, change–she’s very good at orchestrating that. It is sort of like breathing for her.”
What’s for Dinner?
When I sit down with Morrison in her office at Campbell’s Camden headquarters, she bombards me with data about shifting demographics. The American nuclear middle-class family–once Campbell’s bread and butter–is disappearing. The proportion of households in the U.S. made up of married couples with kids has dropped by half since 1970, according to the most recent data from the Census Bureau. They now make up only 20% of households. They’ve been partly replaced by more single adults, who now make up 27% of American households. Households of families without kids–many made up of empty-nest baby boomers and younger millennials, drawn from two massive generations, each close to 80 million strong–have been growing for a long time, as have households consisting of multigenerational families and singletons. But Morrison says the diversity of tastes these different segments represent is most acutely felt right now. “Once upon a time you could throw a casserole in the oven and everyone would have to eat it,” says Morrison. “We’ve had to develop food products in different kinds of packaging and for different kinds of occasions.”
For many Americans, those “occasions” often mean five-minute snacks on the way out the door instead of a sit-down family meal–unless it can be prepared in 27 minutes, the daily U.S. cooking average, according to food expert Michael Pollan. “Our lives are being lived in smaller, bite-size pieces,” says Alexia Howard, a senior analyst at Sanford Bernstein who follows Campbell’s. And as baby boomers age and millennials fret about what goes into their bodies, those snacks had better be healthy. “People want to read the label and understand what they are eating,” says Howard.
This has translated into a boom for fresh foods. In 2014, sales for fresh produce and meat grew by 5% over the year before, according to the most recent Nielsen data, while groceries in the center of the store–home of the packaged goods–were down 1.1%. That trend toward vegetables will only continue. Only 5% of baby boomers report “often going vegetarian,” according to a Hartman Group study, but 12% of millennials do. And those consumers want fresh.
The drive toward real food explains why Morrison would invest in baby carrots–a product closer to a commodity than a processed good. “When I found Bolthouse Farms, one of my board directors said, ‘Carrots, Denise, really?’ and I said, ‘No! Packaged fresh! It’s an $18 billion category growing at 6% to 7%.’ [That growth has since slowed.] We can bring our capabilities and brands to fresh food,” she says. “I love the carrots. The authenticity.”
A Matter of Taste
The Irony, of course, is that in order to make money from a raw carrot, Morrison must make it a bit less authentic. Jeff Dunn, the CEO of Bolthouse, puts it this way: “If you are just buying a bag of unpeeled carrots, that’s a basic commodity. There’s not enough value added in the brand on that. Retailers can have their own brand–a private label. But if you take the carrot and you do something interesting, that lends itself to the brand of Bolthouse baby carrots. The ultimate manifestation of that are veggie snackers–the flavored baby carrots. You take a basic commodity and you add value. That’s branded.”
Not everyone is convinced. Though Campbell’s earnings topped $800 million in 2014, its stock is still lagging, prompting some Wall Street analysts to question when Morrison’s acquisitions will pay off–and fueling rumors that the company could be a takeover candidate. (Warren Buffett’s name gets bandied about, among others.) And the vocal champions of healthier eating may not endorse powder-coated carrots, fruit in tubes or the other innovations that mark the intersection of the fresh-food craze and the persistent clamor for convenience. The sodium in Bolthouse’s ranch seasoning, for instance, means a kid who eats that bag of carrots is getting 8% of the recommended daily intake.
But for Campbell’s, the point isn’t trying to get everyone to eat only unprocessed foods. Instead, it’s catering to consumers who want healthy meals but still need shortcuts (or tastes that placate finicky kids). So Morrison forges on. One of her latest moves: the acquisition of Plum Organics baby food, a company created for the kind of millennial parents who like the idea of home-cooked vegetables for their babies until they realize how hard it is to pull off in a two-career household. Which means Campbell’s can now offer parents baby foods in flavors like pumpkin-date-oats-chia and kale-apple-Greek-yogurt that come in a tube instead of a jar so toddlers can feed themselves. “My 15-month-old grandchild eats kale because of Plum,” Morrison says. “We are training the baby’s palate to like healthier foods at a very young age.”
Up next, Bolthouse may bring its approach to new veggies like celery or cherry tomatoes, Plum will promote products for adults, and Campbell’s will launch a line of organic soups in January. For now, Morrison projects confidence. As she tells aspiring CEOs, “Things don’t always go according to plan, so you have to have the courage and agility to course correct. That doesn’t mean you lose sight of the vision.” For the company’s sake, Campbell’s hopes her vision pans out in time.
This appears in the February 02, 2015 issue of TIME.