From Tokyo, Japan and Changsha, China – this is Down to Business English. With your hosts Skip Montreux and Dez Morgan.
How are you feeling, Skip?
How am I feeling? Not so bad Dez. Why do you ask?
Well, the last time we spoke offline, you were telling me that you were trying to lose a few kilograms.
I told you that?
You did, and how’s that going?
Well, not great. Not bad either. I can’t say that I’ve been making a lot of progress, but I am trying to eat better. Mainly trying to cut down on snacking between meals.
So, no more crisps or sweets for you then?
Crisps?! Oh, you mean potato chips.
Oh, that’s right. You call them potato chips in North America. I don’t think I could ever get used to calling them potato chips.
Yeah, the vocabulary of snacks is a bit of a linguistic minefield between British and American English.
All foods really, not just snacks. For example, we have coriander in the UK, which is cilantro I think in the US.
Right. And … and what is eggplant called in the UK? I … I can never remember.
Aubergine in the UK.
Aubergine. Yeah, I barely can pronounce that.
All this talk about food can’t be good for your diet. You must be getting hungry.
Don’t worry about me, Dez. I have a will of steel.
No, you don’t.
Well I better, because today’s business topic is about the savory snack market.
The savory snack market? You mean as opposed to the sweet snack market like chocolate bars.
That’s right. The savory snack market encompasses snacks that are typically salty or spicy opposed to sweet.
Like crisps, crackers, pretzels, and the like.
Precisely. And there is one company making a big bet on this market.
And who would that be?
None other than Mars Incorporated.
Mars? The maker of the Mars bar, Snickers, M&Ms, and many other of the world’s most popular chocolate bars.
The one and only. In August, Mars announced that they had reached a deal to acquire the snack food company Kellanova for $35.9 billion.
Kella what?
Kellanova?
I don’t think I’ve ever heard of a snack company by the name of Kellanova.
Well it's a new name in the industry, but I am 100% confident that you have eaten at least one if not more of their products.
Well, you’ve whet my appetite. I want to know more about this Kellanova.
Okay, well let’s do it then. Let’s get D2B … Down to Business with Savory Snacks: Mars Inc.'s big move with Kellanova.
So Skip, spill the beans. Who, or perhaps I should ask, what is Kellanova?
Kellanova is the new name of Kellogg’s, or at least part of Kellogg Co.
Kellogg’s? The maker of Kellogg’s Corn Flakes — the breakfast cereal?
Along with other breakfast cereals, yes.
I see. And what exactly do you mean when you say Kellanova is the new name for ‘part of Kellogg’s`?
Well, one year ago this month, in October 2023, Kellogg’s separated its snack food division from its breakfast cereals and formed two independent companies.
I must have missed that headline.
The breakfast cereal division now operates under the name WK Kellogg Co., and the snack food division is under the company name Kellanova.
It seems to be a portmanteau of the words ‘Kellogg’s’ and ‘anova’, which means new. Kellanova — a new Kellogg’s.
And that is exactly what Kellanova means. Also interesting is the font used in Kellanova’s logo.
What is interesting about that?
The first letter of the logo, the ‘K’, is the same traditional font used in the original Kellogg’s logo. But the other letters use a newer, fresher font.
Er, that must be some type of marketing ploy?
Oh, definitely. According to a Kellanova spokesperson, the logo represents a new growth-orientated vision for the future while the company remains grounded in the winning culture established by the company’s founder WK Kellogg.
Yeah, it still sounds a bit like marketing hype to me.
Well in any case, Kellogg Co. is now focused solely on selling breakfast cereals in the US, Canada, and the Caribbean.
And Kellanova?
Kellanova still sells breakfast cereals under the Kellogg’s brand, but not in those three markets. But its main focus is in the savory snacks market, which they sell worldwide.
Including the US, Canada, and the Caribbean.
That’s right.
Interesting. And their products?
Well, some of the famous snack brands under Kellanova’s umbrella are Pop Tarts and Rice Krispie Treats.
Ah, very well known brand names. You’re right Skip, I’ve eaten several of Kellanova’s products.
I knew it. But the real jewel in Kellanova’s crown is their line of Pringles potato chips, which accounted for 24% of their sales in 2023.
Ah, Pringles — I especially love Pringles.
Who doesn’t like Pringles?
Sour cream and onion flavor for me.
Mm. My goto flavor is the Pringle’s Original.
Pringle’s Original?! Mm. Be careful, Skip. You are getting boring in your old age.
I guess I’m more of a traditionalist at heart. Just on a side note Dez, did you know that Pringles were originally developed by Procter & Gamble in reaction to customers complaining about getting bags half full of air and half full of broken, stale chips.
No, I didn’t know that. When was this?
Back in the 1950s. A P&G chemist by the name of Fredric Baur was given the task of solving this issue. He came up with the shape of the Pringle as well as the design of the container.
The iconic cylindrical can.
Yes. And because of the packaging and the unique shape he came up with, Pringles are much more resistant to breakage than traditional crisps in a bag.
Well, that makes a lot of sense if you think about it.
In fact, the shape of the Pringle is actually patented.
You're kidding.
No, I am not. The official patent name of the shape is ‘a hyperbolic paraboloid-shaped potato chip’.
Wow, you certainly did a lot of research on this story Skip.That I did not know.
I did get a bit carried away, true. An ... and here is one more fun fact.
Go on, what’s that?
Well, when Fredric Baur passed away in 2008 at the age of 89, you will never guess what he asked his family to place his ashes in.
No! Don’t tell me — a Pringles can?
A Pringles Original flavor container to be precise.
He sure was proud of his invention.
And he should have been.
But I’m feeling we’re way off the topic now.
Ahh, yes. I have taken us down a rabbit hole a bit here, haven’t I.
Let me try to get us back on track. You said Baur worked for Procter & Gamble.
Yes, I did.
Not Kellogg’s?
No.
Then how is it that today, Pringles is a Kellanova product?
Ah, great question. Kellogg’s bought Pringles from Proctor & Gamble in 2012 for $2.7 billion. And it turned out to be an excellent investment as annual sales of Pringles doubled over the next ten years.
And I can imagine that the COVID pandemic lockdowns were good for all snack companies. Everyone was stuck indoors with nothing to do but watch Netflix and eat those snacks.
It was certainly a growth market, in more ways than one.
Ha. Very funny. So, is this why Mars Inc. is acquiring Kellanova, because savory snacks are a growth market?
That is one reason. But there is another factor motivating, or at least influencing Mars.
And what would that be?
Do you remember our report back in May this year, in D2B episode 315 — The Cocoa Crisis?
Yeah, I remember it well. We reported on the dramatic rise in the price of cocoa.
And who was getting hit the hardest by that increase.
Of course, chocolate manufacturers — like Mars.
Precisely. And being predominantly a chocolate bar maker, Mars has very little presence in the savory snack market, which has much less exposure to cocoa prices.
But now, $35 billion later, they sure do.
Well it’s not quite a done deal yet.
No? What’s the hold up?
Everything still needs to be approved by Kellanova’s shareholders.
Of course.
But when everything is finalized sometimes next year, Mars is going to all of a sudden be a major player in the savory snack market.
And who would they be competing against?
The biggest player is PepsiCo. PepsiCo is the parent company of Lay’s and Frito-Lays in North America and Walkers in the UK.
Ah, so you are talking about brands like Doritos, Cheetos, and Walkers Crisps.
Yes. Currently PepsiCo is the global market leader in savory snacks. But experts are saying that Mars’ acquisition of Kellanova is a game-changer.
It sure sounds like this acquisition will give Mars Inc. a much bigger footprint in the market, with a wider variety of snacks in their product line.
Substantially more.
Well Skip, if I wasn’t hungry before, I sure am now. Before I have to rush out to the shops and get myself a can of Pringles, I think it's time for us to get D2V … Down to Vocabulary. I will get things started today with the noun minefield, which literally means a field full of landmines.
Landmines are a type of bomb or explosive buried just under the surface of the ground so people can’t see them and are deadly if you step on one.
That’s right. But idiomatically, when you say something is a minefield, you're saying it's a situation that has many dangers.
And those dangers are often hidden, or unknown.
In today’s report, Skip commented that the American and British names of foods and snacks are a linguistic minefield.
I wasn’t saying that the vocabulary was ‘dangerous’ but rather, because there are so many differences between the two it's easy to make a mistake or get confused without being aware of your mistake.
Well, it’s not really a mistake. But imagine you’re on a business trip in the UK and you're at a business lunch with a client. When you ask the waiter what is in the salad, it would be good if you understood that an aubergine and eggplant are the same thing.
Definitely.
Can you give us another example using ‘minefield’?
Yes. The government regulations that pharmaceutical companies have to go through to get a new drug onto the market is a real minefield. There are so many laws and requirements they have to meet, and if the company makes even one small mistake in their application, it could set the whole project back years.
But if the drug does make it to market, it can be very lucrative. Just look at NovoNordisk and its drug Ozempic.
Mm. Very true. Next up we have the expression to be the jewel in the crown. Imagine a royal crown studded with rare jewels.
Just picture the recent coronation of King Charles III, with him sitting on the throne wearing St. Edward's Crown.
Is that what the British Crown is called, St. Edward’s Crown?
Yes, it is. It dates to the 17th century. It’s made of solid gold, and is decorated with 444 gemstones.
Ah, so it is a very important item.
As a symbol of the British monarchy, absolutely.
And that is the meaning of the expression ‘the jewel in the crown’. The most valuable part of something. In my report, I described Pringles as the jewel in the crown of Kellanova’s product line as they make up 24% of sales. In other words, Kellanova’s most important product is Pringles.
Japan’s Sanrio corporation has a lot of different characters but the real jewel in their crown is Hello Kitty. Along with Disney’s Mickey Mouse, Hello Kitty is one of the world’s most recognizable characters.
I would almost think that Hello Kitty might be even more recognizable these days.
Oh, I highly doubt that. I think I read somewhere that Mickey Mouse has even more name recognition than Santa Claus.
Really? Well, that’s a fun fact.
It sure is a fun fact. And the two part noun ‘fun fact’ is our final word for D2V today. A fun fact is a piece of trivia that is interesting but not central to the point you are making. In the report, Skip told us the fun fact that after his death, the creator of Pringles had his ashes placed in a Pringles can.
That is a fun fact, or at least a surprising fact. But like you said, not really central to the story.
Do you have any other fun facts for us to end this Skip?
Well, here is another fun fact about Pringles.
And what’s that?
Pringles Japan has featured the following flavors in its lineup — Wasabi Nori, or seaweed, Takoyaki, or octopus, Manhattan Clam Chowder, Hawaiian BBQ, and Karaage, or fried chicken.
Wow, so many different flavors to choose from.
Kellanova also teamed up with a Japanese instant ramen maker by the name of Acehook a few years back, and together they released a Pringles flavored instant ramen.
Oh yeah, I’d definitely have to go for that. I mean, who wouldn’t like a snack that’s designed to taste like another snack.
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And that was our report on Savory Snacks and Mars Inc.’s acquisition of Kellanova.
I hope everyone found it informative, and that you aren't too hungry listening to us talk about snacks.
D2B Members and Apple Podcast subscribers, the Bonus vocabulary episode for today’s D2B will drop soon. The words and phrases we will focus on in the Bonus D2V episode will be — to encompass, to whet one’s appetite, to be under the umbrella of something, a hold up, and a game changer.
Lot’s of professional vocabulary on that list.
There is.
If you are a D2B member, that bonus D2V episode will be in your Members-only RSS feed very soon.
So you want to make sure to visit your Member’s account on the D2B website and add that URL into an app like Apple Podcast, YouTube Music, or Overcast.
And Apple Podcast subscribers, you don’t need to do anything. The bonus D2V episode will automatically show up in your Apple Podcast app as soon as it is released.
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Bye bye.
Have a comment or question about today’s show? Don’t be shy… visit the D2B website or Facebook page, and post any comments or questions there. Skip, Dez, or Samantha will be sure to leave a reply. Down to Business English … Business News, to improve your Business English.