At Hormel (HRL) corporate headquarters in Austin, Minn., they call it “unwanted e-mail,” never spam. It’s been a sore subject ever since the mid-’90s, when chat-room users first flooded computer screens with the word “spam” to blot out the comments of users they didn’t like. Wikipedia gives the example of Star Wars fans “spamming” Star Trek chat rooms. The word was chosen because of the famous Monty Python sketch in which every item on a restaurant’s menu includes Spam, Hormel’s canned, spiced lunchmeat. The skit was a back-handed compliment, a tribute to Spam’s success at monopolizing the British diet.
By the late ’90s, spam had migrated from Internet chat rooms to in-boxes as a term of art for junk e-mail, becoming synonymous with erectile dysfunction ads and entreaties from fake Nigerian princes, and presenting Hormel with the greatest marketing challenge in its 75-year history. “We had something negative that was trading on our brand equity, on our name,” says Dan Goldman, Hormel’s grocery products manager. “You have to protect what’s yours.”
Photograph by Aaron Dyer for Bloomberg Businessweek
Companies have long had to contend with damage to their brand image from mistakes of their own, such as poor design (Toyota’s (TM) allegedly lethal floor mats), the mishandling of a minor crisis (JetBlue’s (JBLU) disastrous response to the ice storm of 2007), or collateral damage from behavior out of their control (Tiger Woods, Brand Ambassador). There is no playbook or case study, however, for what to do when your flagship product takes on a negative meaning in another larger and global context. In 2002, Hormel attempted to assert its trademark rights against Spam Arrest, a software company, Spam Buster, an e-mail blocker, and Spam Cube, an Internet security firm, but no dice. Hormel even sued Jim Henson Productions for naming a warthog character “Spa’am” in Muppet Treasure Island. The judge dismissed the suit, noting, “One might think Hormel would welcome the association with a genuine source of pork.” Powerless to stop the widely accepted usage, the company watched helplessly as “spam” entered the Oxford English Dictionary in 2001 not as a pork product but as unsolicited messages. Hormel mournfully admitted on its own website that, “we are trying to avoid the day when the consuming public asks, ‘why would Hormel foods name its product after junk e-mail?’”
It’s hard to imagine a brand surviving that kind of association, and yet a strange thing happened: Spam has not only survived, it’s thrived. Hormel sold 122 million cans of Spam last year, an increase of 11 percent over 2009, continuing a string of three consecutive years of strong growth. Company executives attribute the resurgence to the recession (which drew consumers to the affordable lunchmeat), a tireless parade of brand extensions, and, crucially, a willingness to be in on the joke that Spam had become.
“We decided we should celebrate Spam,” says James Splinter, a vice president in the group products division. In addition to fending off the negative association with unwanted e-mail, Splinter says, Hormel looked on sagging sales in the ’90s as an indicator that Spam had become too familiar. “Spam is woven into the fabric of America,” he beams, but it needed to stand out again. “Spam is something bigger than food. It also has cravable flavor.” (“Cravable flavor” is an expression you hear a lot around Hormel headquarters.)
Geo. A. Hormel & Co. canned the first ham in 1926. Hormel’s hams became popular among hotels and restaurants but the cans were considered too bulky to break into the home market. Eleven years later, Jay C. Hormel, the founder’s son, devised a solution: a rectangular, 12-ounce can of ham and shoulder meat named, by the brother of one of his VPs, Spam, short for SPiced hAM. The original cans were labeled “The Meat of Many Uses” and at 10¢ each were an immediate hit with depression-era families. The product became an institution during World War II, when the almost indestructible square cans were a staple of U.S. servicemen who also introduced the product to hungry foreign markets. Today, Hormel processes nearly 20,000 pigs a day. Spam is canned before it’s cooked in a 70-foot-tall cylindrical oven, which towers over the town of Austin, where Hormel is by far the largest employer.
In the last 20 years, Hormel has made at least five national marketing pushes, leading to the current “Break the Monotony” campaign, featuring a TV spot where anthropomorphic slices of bread doze off at a “bored” room presentation—until the doors burst open, flames erupt, and a can of Spam slides across the table. The voice-over proclaims, “for a sandwich that rocks, try a Spam, lettuce, and tomato.” Splinter explains, “I think of it like Old Spice: It’s gone from dad’s brand to a hip young brand.”
The company sponsored the NFL and Nascar, and Spam was used as part of the “Got Milk?” campaign. Yet the watershed moment in Spam’s transformation came in 2005, when Hormel joined in the promotion of the Tony-winning Broadway musical Spamalot, written by Monty Python’s Eric Idle. “We realized we need to have fun with the brand, since everyone else was,” says brand manager Nicole Behne. Steven Addis of Addis Creson, a brand strategy and design firm, says that embracing its status as a punch line was the key to Spam’s comeback. “They learned that they couldn’t fight it,” he says. “They needed to see it as a gift.” Daniel Altman of branding company A Hundred Monkeys in Mill Valley, Calif., agrees. Hormel pulled off “a judo move,” he says. “They took that issue”—of unwanted e-mail—“and turned it to their advantage.”
This newfound sense of humor has begun making its way into the dizzying number of brand extensions Spam introduced in the last two decades, including nine new varieties of its lunchmeat. Released in 2006 to coincide with Spamalot, “Spam Stinky French Garlic Collector’s Edition” came decorated with nose-pinching knights and the following tongue-in-cheek note: “Actually made in Denmark with Chinese Garlic.”
The brand has also expanded beyond grocery store shelves. In 2001, Hormel opened the Spam Museum, which has become the leading tourist attraction in Austin. It presents a revisionist account of the 20th century, recasting the American journey as, essentially, the history of canned meat. (Spam ends the Great Depression. Spam wins World War II. Spam goes to outer space.) A year later, Spam launched the first annual Spam Jam festivals, complete with the Spamettes singing group, in Minnesota and Hawaii—the state with the highest per capita consumption of Spam.
As Hormel celebrates this year’s 75th anniversary, it’s introduced a new Spam spokes-character, Sir Can-A-Lot, a lozenge-shaped knight “on a crusade to rescue meals from the routine,” and two limited-time Spam variations, jalapeño and black pepper. Hormel’s strategists are also doing their best to speak the language of social media rather than hold a grudge. “Spam is sort of like Facebook,” suggests Scott Aakre, vice president of grocery products. “There are friends you talk to every day, and those you talk to only once in a while. Well, you have consumers who have friended Spam. Some use it every day, others once in a while. But this is an old friend who is going to be around for a while.”