Utz Brands Shifts Strategies Around Marketing & Supply Chain

HANOVER, Pa. — Utz Brands Inc. is making investments in its marketing and supply chain capabilities as the company continues on a growth trajectory.

In a recent call with investors, Utz CEO Dylan Lissette said the Hanover-based snack manufacturer is significantly shifting its marketing spend to more dynamic and nimble activities and further away from the multiyear sponsorships of the past.

As a result, Utz will increase its consumer pool marketing spend by about 40 percent, primarily in the second half of the year, reported Convenience Store News sister publication Consumer Goods Technology (CGT).

In addition to leaning into user-generated content across its social media platforms, Utz intends to extend its voice to consumers through both advanced targeting of media and earned reach. 

"We are finding success in connecting and engaging with our fans on high attention platforms," noted Lissette. "Our social media following of both the Utz brand and the Zapp's brand has more than doubled since the start of this year. And we are connecting in a deeper way with consumers through driven marketing, to provide the right message to the right consumer at the right moment at the right place, and then measuring the impact."

Since the company went public in 2020, there hasn't been much of a difference in how Utz operates; however, it is evolving a few strategies, Lissette pointed out.

For example, Utz has historically spent very little in terms of marketing and media to drive its brands, "and we want to look for ways that we can increase that over time," the chief executive said, adding that the company also plans to increase its direct-store delivery footprint through the recent acquisitions of Clem Snacks and J&D Snacks, both based in New York, and moving into Publix Super Markets.

To support expansion, Utz continues to invest in its supply chain and productivity initiatives, both of which it expects to help offset inflation, CGT reported. The company will focus primarily on manufacturing efficiencies, logistics, and packaging and product design, as well as transform how it approaches demand and supply planning.

"We are making great progress in our productivity programs, and I'm confident that these actions along with strategic price pack architecture initiatives will result in structural improvements that will drive meaningful long-term margin benefit to the company," Utz Brand Chief Financial Officer and Executive Vice President Ajay Kataria said during the call with investors.

Kataria noted that the company's supply chain is improving thanks to enhanced manufacturing, logistics and planning capabilities, in addition to increasing throughput and efficiencies. 

"Our recent acquisition integrations are on track and are allowing us to scale our manufacturing capabilities to efficiently support strong demand for our power brands portfolio," he added. "Our recent investments in technology are helping to unlock insights that enable several margin enhancing work streams."

While Utz is not immune to supply chain disruption, operations are stabilizing, Kataria pointed out, noting that the company has "built a lot of muscle around how to tackle that." The combination of these investments and price increases has enabled the company to offset inflation.  

"In our supply chain, manufacturing, logistics and distribution, we made people investments. And we are also optimizing enhancing our manufacturing footprint," he noted. "So, all of those things, all the actions that we have taken have really helped us from a cost and financial standpoint."

Utz’s diverse portfolio of savory snack brands includes Utz, ON THE BORDER Chips & Dips, Golden Flake, Zapp's, Good Health, Boulder Canyon, Hawaiian Brand and TORTIYAHS. In the second quarter of 2022, the company grew net sales 17.5 percent to $305.1 million.

Consumer Goods Technology and Convenience Store News are properties of EnsembleIQ.