Kraft Heinz introduces the Remix customizable sauce dispenser for restaurants

For more than 125 years, Heinz bottles have advertised “57 varieties,” a number entirely invented by its founder, with little or no use in practice.

Now, Kraft Heinz aims to offer its customers more than three times as many condiment options with a new customizable sauce dispenser designed for customers in the hospitality industry.

Dubbed the Heinz Remix, the machine is the latest example of Kraft Heinz’s focus on the out-of-home segment to boost sales. The company has expanded distribution to airports, launched a deluxe version of its mayonnaise for chefs, and reformulated its lunchables so they can be served in schools. In the first quarter, Kraft Heinz’s North American foodservice division posted revenue growth of more than 25%.

The company will debut the remix at the National Restaurant Association Show, which begins Saturday in Chicago. It is planned to test the dispenser in restaurants as early as the end of this year.

“We are very, very aware that out-of-home and hospitality gives us the opportunity to test, learn, understand and develop trends much earlier than we have in the past” , said Peter Hall, general manager of Kraft Heinz’s North American Food Service Division.

Hall said the company is still working on the specific business model for the Heinz remix. They are also examining how the dispenser can be used for drive-through orders, he said. But the machine requires more time and effort than tossing a handful of ketchup packets into a takeout bag, which will likely pose a challenge for speed-focused drive-thru lanes.

To prepare a customized sauce, consumers use the touchscreen to select a base from ketchup, ranch sauce, 57 sauce or BBQ sauce. Add “amps” including jalapeno, smoky chipotle, buffalo and mango; and set one of three intensity levels.

Alan Kleinerman, head of disruption at Kraft Heinz, told CNBC his favorite combination is ranch dressing with a hefty dose of jalapeno and a lighter infusion of smoky chipotle. But one dark horse — mango ketchup — has been causing the biggest stir in Kraft Heinz’s office lately, he said.

The company developed the Heinz Remix in just six months with the helping hands of Microsoft, device engineers and Internet of Things developers.

“We are on a journey to make innovation the key driver of growth across our organization,” said Kleinerman. “To do that, we had to operate differently than in the past, think bigger and be more consumer-centric.”

The owner of Oscar Mayer is in the midst of a turnaround after his previous management’s focus on cutting costs led to a decline in sales in North America. Trouble culminated in 2019, when the company disclosed $16.6 billion in writedowns on iconic brands like Cool Whip and Kraft, as well as an SEC investigation into its accounting.

Last quarter, Kraft Heinz reported a 6.2% increase in sales in North America as higher prices offset falling demand from inflation-freak shoppers. Kraft Heinz shares are down 3% this year, bringing the company’s market value to $48.5 billion. shares of S&P 500 increased by 7% over the same period.

Although the Heinz Remix is ​​new, its design feels familiar thanks to its resemblance to the Coke Freestyle machine launched almost 15 years ago.

Today, Coke’s touchscreen vending machines can be found in more than 50,000 locations, including MC Donalds restaurants, AMC cinemas and Goal stores. The most popular custom-made products by customers freestyle machines have inspired the drinks giant to introduce new bottled drinks like Sprite Cherry and Coke with Cherry and Vanilla.

“They showed the power of iteration and innovation when given feedback,” Kleinerman said of Coca-Cola.

However, he added that consumers and food service operators are the main inspiration for the Heinz Remix.

“I think it’s easy to draw parallels, but this was an opportunity that grew out of the original insights and our desire to really transform and build on the experiences consumers are having today,” Kleinerman told CNBC.

According to Kleinerman, customers at Kraft Heinz were asking for condiments that were hotter or offered a mix of sweet and savory, while restaurateurs told the company they wanted more variety.

Like Coca-Cola, Kraft Heinz plans to use data from its sauce dispenser to decide which new products to launch in grocery stores. The hope is that the Heinz Remix will push new products that customers actually want, rather than the ones they say they want — but never buy.

In recent years, Heinz has launched a range of condiments inspired by the combination of his most popular sauces, including mayochup, crane and buffaranch.