KANSAS CITY — The convenience store channel was severely disrupted in 2020 with lockdowns and mobility restrictions. Even so, Hostess Brands, Inc. was able to score mid-single digit growth and gain about 140 basis points of market share. Now, the Kansas City-based sweet goods and snacks maker will look to hold onto those wins as the channel opens back up more fully in 2021 by relying on the data, relationships and good decision making that made it successful during the past year.
“It’s our highest share development,” Andrew P. Callahan, president and chief executive officer, said during a March 10 presentation at the UBS Global Consumer and Retail Virtual Conference. “It’s a profitable channel for us. We do very well. We’ve always stated … our investment in the foundation of sustainable growth has really come to play here. You never know what — you didn’t anticipate this, but you lean on those foundational elements to be able to grow.”
Mr. Callahan said Hostess plans to lean on the breadth of its distribution to continue growing its presence in the convenience store channel.
“We’re able to access consumers across all channels,” he said. “We have an ACV above 90%, which is 10 points greater than anybody else within our category. So when the category shifts or other things happen, we’re there for consumers.”
Another key will be the company’s investment in information and data to understand how to serve its customers.
“We didn’t lead them during the pandemic,” Mr. Callahan said. “With c-stores down, we didn’t do a student body left to another channel. We built lasting sustainable, mutually beneficial relationships with all of our customers. Those relationships pay out over time. … We want our customers to come to us when they need growth. That’s absolutely true with our distributors and our c-store customers.
“We invested in data so we can understand how to get to the right mix real time. And then grow the quality of our distribution and the breadth of our distribution and shelf presence when you walk into stores to be able to make sure we have what consumers are looking for. When the pandemic hit, we were able to accelerate that by making sure we expanded shelf space in our highest velocity items, be there when our customers didn’t have another alternative to expand in our space. And then continue to build it from that foundation.”