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One of his favorite stats is: There are more U.S. households with a dog or cat than households with children age 6 to 12.
And in those homes with pets, they are treated much like children. For example, 41 percent of pet owners display their pooch's picture in the home.
Lachman, managing director of Heinz Pet Snacks, a division of H.J. Heinz Co., is among a new breed of managers recruited under Chairman William R. Johnson and his Heinz North America Chief Executive Joe Jiminez. Both are determined to mine demographic data to produce innovative new products and packaging in all of Heinz's product categories.
'In pet snacks, we want to think and act like a (people) snack food company,' Lachman said.
In recent years, Heinz's pet foods business has been like a flea behind the ears of the company's earnings, sucking profits away. Heinz executives have scratched away at the problem by dividing pet foods into three categories: pet food, pet snacks and specialty pet foods, which sells premium pet foods to veterinary clinics and pet specialty stores like PetSmart.
The pet snack category has been a profitable one for Heinz, part of the reason Johnson wanted it grown separately from the company's struggling canned Skippy dog food and the 9 Lives cat food brands.
Heinz wants to replicate the success it has enjoyed with green ketchup with new pet snacks packaged in clear plastic tennis ball cans, or with unique taste characteristics like a crunchy exterior with a creamy filling.
'We've inherited great brand equities,' said Lachman, who joined Heinz last year from Proctor & Gamble. 'Now we're focusing on rejuvenating our brands that have been around for a while like Meaty Bone and Pup-Peroni. We're dusting those off and giving them a new fresh look for the consumer.'
Lachman repeats a theme of managers in other Heinz divisions that the company had allowed its well-known brand names to languish in recent years.
'In the past, I believe we underinvested. But now we're going to come out with a constant stream of innovative new products that we will support vigorously.'
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Despite its dominance, Lachman said there is room for growth, pointing out that only 40 percent of cat owners give their cats snacks.
Of the approximately $1.1 billion spent annually on pet snacks, $1 billion is spent on dog snacks, and $100 million on cat snacks. Lachman wants that number to grow to Heinz's benefit.
'It's more difficult to give the cat a snack because of the emotional receptivity you get when you give a cat a snack (compared to a tail-wagging dog),' Lachman said. 'Even though we're the market leaders, I'd rather keep one step ahead of my own portfolio than have someone else do it for me.'
Heinz is marketing Purr-fections as a gourmet cat snack aimed at guilt-ridden pet owners - especially career-oriented singles and dual-career couples - who want to indulge their pets while they are not home.
Initial returns are promising. At the grocery store, Purr-fections already commands a 6.6 percent share of the cat snack market after 10 weeks; its marketing campaign won't begin until next month.
Sales growth of the total cat snack category in the same 10 weeks since the Purr-fections launch has been 18-20 percent, double what it was in the previous 10 weeks.
John Bifulco, who manages the pet aisle for Pittsburgh-area Giant Eagle grocery stores, said the cat population is going to grow due to the rise in dual income households.
He said Heinz is wise to come out with new products aimed at this trend.
'They're being progressive. Their packaging is a lot better than it used to be,' he said.
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Lachman said retailers like the new products because they can make a bigger profit from them.
'We're taking the average category price up, but at $1.49 it is still considered a value for consumers,' he said.
Retailers are responding to the entry of specialty retailers like PetSmart and Petco by expanding their pet food aisles.
Bifulco said pet aisles in Giant Eagle stores already are larger than in most other stores in the region. Within that space, he said, the chain has added a greater variety of products, in part due to the increasing competition from the specialty retailers and mass merchandisers like Wal-Mart.
Following-up on the launch of Purr-fections will be new versions of the Meaty Bone and Pup-Peroni brands that will be hitting store shelves in late July.
In dog snacks, Heinz has about 14 percent of the much larger market, which it attacks with several other brands, including Snausages, Jerky Treats, Wagwells and Canine Carry Outs.
Pup-peroni Nawsomes, which come in a see-through tennis ball container, are a dual strand twisted snack that is a cross between a typical snack and a long-lasting chew. They will come in three varieties.
Meaty Bone Savory bites are a creamy-filled crunchy nugget, similar to Purr-fections, and will also have three varieties.
Both are expected on store shelves by the end of July.
Like Purr-fections, Nawsome and Savory Bites present a trade-up opportunity for retailers with an average retail price of $2.99, compared to the existing average price for the category of $2.49, Lachman said.
Heinz isn't saying much about it yet, but it plans to re-launch its 9 Lives cat food business later in the year with new products and new advertising featuring Morris the Cat.
'The most important strategy we have is providing the consumer with innovative products that provide a real wow for the consumer,' Lachman said.
And a real bow-wow to the pets they are trying to please.
| Heinz pet snack history |
Heinz has been building its pet snack business for 22 years. Last year, it was designated a stand-alone division. Here is a brief history of the category's growth at Heinz.
1979 - Acquired Jerky Treats brand
1982 - Acquired Meaty Bone biscuits brand
1983 - Pounce cat snacks introduced by Quaker Foods
1985 - Pup-peroni and Snausages introduced by Quaker
1995 - Heinz makes company's largest acquisition to date - Quaker's pet foods business, which included Kibbles N Bits dry dog food.
2000 - Heinz Pet Treats established as a business unit on equal footing with StarKist Seafood and ketchup, condiments and sauces, etc.
