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Consumers Can’t Get Enough of the Mercilessly Mocked Meat

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September 6, 2018

Food Dive

When Sophie Ann Terrisse sat down for lunch with colleagues at a conference last January in Hawaii, the discussion quickly gravitated toward a mysterious item on the menu that left many of the 20-somethings at her table perplexed.

“It was delicious and everybody was like, ‘What is this?’ ” Terrisse, a senior adviser with brand management firm 26FIVE, told Food Dive. They found out it “was Spam, and they were like, ‘I want more.’ ”

Spam, the brunt of ridicule by British comedy troupe Monty Python with a name that was crudely tied to unwanted inbox-cluttering email, has managed to stand the test of time — and even thrive — amid a rapid consumer shift away from heavily processed foods in favor of fresher, better-for-you fare.

A concoction of pork with ham, salt, water, potato starch, sugar and sodium nitrate, Spam has shed its staid image by innovating to remain relevant while taking advantage of its popularity with people in South Korea and Asia, and increasingly among Hispanics residing in southern parts of Texas and California.

Brittany Weissman, an analyst at Edward Jones, told Food Dive that while Spam isn’t a major driver of sales at Hormel Foods, it’s a good example of the company’s ability to nurture and grow brands in its portfolio. Spam, she said, also has benefited from surging demand for throwback foods and ingredients viewed as new and unique.

“Many people might think Spam is a declining brand, when in fact it has a solid track record of growth,” Weissman said. “Hormel has done a good job embracing the brand’s past, tailoring the flavors to local markets, and innovating to keep the product relevant.”

Sales have posted records in each of the last three years — climbing to about $217 million during the 52 weeks ended July 15 — with a compound annual growth rate of 2.5% since 2013, according to IRI data. Hormel Foods is forecasting another all-time high again this year. An estimated 12.8 cans of Spam, which won’t spoil for years if unopened, are consumed every second around the world.

“It’s not just one silver bullet. … Where we are seeing the rejuvenation of Spam is the ability of this brand to understand the trends, and the ability to capitalize on existing cultural dynamics for the benefit of its equity,” Luis Marconi, group vice president of grocery products at Hormel Foods, told Food Dive. He said the brand has to innovate “or you lose relevance and the consumer will forget about you.”

The history of Spam

Spam, which got its iconic name from the brother of a Hormel Foods vice president who won a $100 naming contest, traces its origins back to 1937 during the height of the Great Depression, where it was praised as a “miracle meat” in a can. One popular belief claims the word Spam was derived from the words “spiced ham,” but a Hormel spokesperson said the real answer is known by only a small circle of former Hormel Foods executives.

During World War II, more than 100 million pounds were donated to feed to allied troops, according to the company. Spam became a source of food for residents in parts of the South Pacific during the war, and to this day it remains a popular ingredient for people who have ties to the region.

A few years later in the 1950s, U.S. troops in Korea were fed Spam, and solders cooked the meat for local residents. One recipe, Army base stew with Spam, pepperoni, hot dogs and Vienna sausage, has become part of local culture. Spam is so beloved by people there that it’s often given as a gift during Korean holidays.

Today, Spam’s global reach is filtering into local flavor profiles in the U.S., from Cuban Americans in Miami to Hispanics living in Texas or California that include the meat in fried rice or tacos.

With Americans eager to try new foods and flavors, more ethnic cuisines are making their way on to mainstream menus — and if people tied to those recipes grew up eating Spam, it’s likely that it gets included in some of the dishes they make for their friends and families. Spam’s sales have been helped by the growth of the Asian American population in the U.S. — they are more likely to consume the product than any other nationality.

Even some McDonald’s in Hawaii and high-end restaurants in New York City and Los Angeles incorporate Spam into their dishes.

“There are multiple examples as to how this brand presents itself and builds equity according to different audiences and different consumer segments,” Marconi said. “Spam has a history. Spam has a story to tell. It has participated in the lives of so many consumers in so many ways.”

Keeping it relevant

While Spam has benefited from its popularity among ethnicities that grew up with it, Hormel has occasionally made small changes to the brand in an effort to freshen it up and shed its staid image as an antiquated product.

“It’s an iconic brand, and Hormel has done a good job nurturing that image while also staying relevant,” Weissman​ said. “Hormel has … done a good job transferring Spam to other markets and innovating flavors to meet the demand of consumers in those markets.”

In the late 1990s, Hormel changed the picture of Spam on the packaging from the iconic image of the meat on a plate to one showing it sliced inside a hamburger bun with cheese, lettuce and tomato — part of an effort to increase its reach as an everyday item. Spam with jalapeño was so popular in Texas that Hormel released its own version of it in 2012 — the 75th anniversary of the brand.
“It’s really interesting how (Hormel) is completely reinventing the story, and that doesn’t cost them a lot,” Terrisse said. “Those old products have a huge opportunity because they can leverage that heritage and recreate a story so quickly. Every brand right now is trying to figure out what their invention can be.”

Unlike many products, Spam’s longevity can be credited in part to the way it has infiltrated pop culture in the U.S, beyond just email, jokes and the movies.

Despite being the brunt of so many jokes, Spam is widely loved by many Americans. It’s so popular that 100,000 people make an annual trip to visit the Spam Museum near Hormel’s Austin, Minn. headquarters. And each year, Hawaii — which has the highest Spam consumption rate in the nation at 7 million cans annually — hosts a Spam Jam festival on Waikiki Beach where as many as 40,000 people gather for a day in April to prepare their favorite recipes inspired from the meat, and sell their favorite souvenirs like Spam soap.

Marconi said Hormel has used places and events like the museum or festival to promote the brand and connect new generations of consumers with a product created decades before many of them were born. Even emails and comedy sketches, once unwelcomed, are now viewed within the company as an asset.

“Initially when we saw the association with Spam with unsolicited email we were obviously really concerned but then when we started to say ‘Hey, the more we resist this, the worse it can be. We realized that people were having fun with the brand and we started to use it,” Marconi said. “Instead of resisting and fighting, we started to make kind of laughter of ourselves. … The reality is we didn’t get the negativity of the bad press.”