Goodles Is on the Road to $1 Billion in Cheesy Noodle Revenue. Annie’s May Never Catch Up

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Goodles Is on the Road to Billion in Cheesy Noodle Revenue. Annie’s May Never Catch Up

The two brands made opposite bets about who mac and cheese is for.

EXPERT OPINION BY JAMES F. RICHARDSON, PHD, FOUNDER, PREMIUM GROWTH SOLUTIONS

Goodles Is on the Road to $1 Billion in Cheesy Noodle Revenue. Annie's May Never Catch Up

The high-protein, high-fiber, flavor-maxxing mac and cheese insurgent, Goodles, is all over the news this week after announcing it entered an agreement to be acquired by Barilla Group. But twelve years ago, another insurgent cheesy noodles brand, Annie’s, made M&A headlines after an incredibly long slog toward about $200 million in trailing revenue.

So, is there room for multiple emerging brands in this category with Kraft Heinz constantly looming?

I believe the answer is yes.

Many have forgotten that Annie’s didn’t really accelerate significantly until the early 2010s, when its core business gained access to the main “dinner mix” shelf near Kraft Blue Box in national supermarket chains. Annie’s had a lot of structural challenges that stifled faster growth, including the narrow “Whole Foods Mom” consumer audience, the involvement of not-very-experienced venture capital, and fairly weak creative on the marketing side (aside from the bunny).

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Yet, today, Annie’s mac and cheese business appears

Yet, today, Annie’s mac and cheese business appears to have already hit the top of the S-curve, based on data the bunny’s cheesy noodles are already a low-growth revenue stream within a sprawling natural-brand franchise

Focus (vs. platforming)

The word “sprawling” is our clue here. Goodles has a huge opportunity to blow right past Annie’s in the mac and cheese space because the business is hyperfocused on one food form, one category, and one adult experience.

Annie’s made a strategic decision long before its 2012 IPO to become a kids’ food platform. By the time General Mills acquired the business in 2014, almost half of Annie’s revenue came from snacks (cookies and crackers). In fact, the brand was selling in a dozen or so unrelated categories—including salad dressing, soup, mac and cheese, cookies, and crackers—when it changed ownership.

Source: www.inc.com