NZ Herald
  • Home
  • Latest news
  • Herald NOW
  • Video
  • New Zealand
  • Sport
  • World
  • Business
  • Entertainment
  • Podcasts
  • Quizzes
  • Opinion
  • Lifestyle
  • Travel
  • Viva
  • Weather

Subscriptions

  • Herald Premium
  • Viva Premium
  • The Listener
  • BusinessDesk

Sections

  • Latest news
  • New Zealand
    • All New Zealand
    • Crime
    • Politics
    • Education
    • Open Justice
    • Scam Update
  • Herald NOW
  • On The Up
  • World
    • All World
    • Australia
    • Asia
    • UK
    • United States
    • Middle East
    • Europe
    • Pacific
  • Business
    • All Business
    • MarketsSharesCurrencyCommoditiesStock TakesCrypto
    • Markets with Madison
    • Media Insider
    • Business analysis
    • Personal financeKiwiSaverInterest ratesTaxInvestment
    • EconomyInflationGDPOfficial cash rateEmployment
    • Small business
    • Business reportsMood of the BoardroomProject AucklandSustainable business and financeCapital markets reportAgribusiness reportInfrastructure reportDynamic business
    • Deloitte Top 200 Awards
    • CompaniesAged CareAgribusinessAirlinesBanking and financeConstructionEnergyFreight and logisticsHealthcareManufacturingMedia and MarketingRetailTelecommunicationsTourism
  • Opinion
    • All Opinion
    • Analysis
    • Editorials
    • Business analysis
    • Premium opinion
    • Letters to the editor
  • Politics
  • Sport
    • All Sport
    • OlympicsParalympics
    • RugbySuper RugbyNPCAll BlacksBlack FernsRugby sevensSchool rugby
    • CricketBlack CapsWhite Ferns
    • Racing
    • NetballSilver Ferns
    • LeagueWarriorsNRL
    • FootballWellington PhoenixAuckland FCAll WhitesFootball FernsEnglish Premier League
    • GolfNZ Open
    • MotorsportFormula 1
    • Boxing
    • UFC
    • BasketballNBABreakersTall BlacksTall Ferns
    • Tennis
    • Cycling
    • Athletics
    • SailingAmerica's CupSailGP
    • Rowing
  • Lifestyle
    • All Lifestyle
    • Viva - Food, fashion & beauty
    • Society Insider
    • Royals
    • Sex & relationships
    • Food & drinkRecipesRecipe collectionsRestaurant reviewsRestaurant bookings
    • Health & wellbeing
    • Fashion & beauty
    • Pets & animals
    • The Selection - Shop the trendsShop fashionShop beautyShop entertainmentShop giftsShop home & living
    • Milford's Investing Place
  • Entertainment
    • All Entertainment
    • TV
    • MoviesMovie reviews
    • MusicMusic reviews
    • BooksBook reviews
    • Culture
    • ReviewsBook reviewsMovie reviewsMusic reviewsRestaurant reviews
  • Travel
    • All Travel
    • News
    • New ZealandNorthlandAucklandWellingtonCanterburyOtago / QueenstownNelson-TasmanBest NZ beaches
    • International travelAustraliaPacific IslandsEuropeUKUSAAfricaAsia
    • Rail holidays
    • Cruise holidays
    • Ski holidays
    • Luxury travel
    • Adventure travel
  • Kāhu Māori news
  • Environment
    • All Environment
    • Our Green Future
  • Talanoa Pacific news
  • Property
    • All Property
    • Property Insider
    • Interest rates tracker
    • Residential property listings
    • Commercial property listings
  • Health
  • Technology
    • All Technology
    • AI
    • Social media
  • Rural
    • All Rural
    • Dairy farming
    • Sheep & beef farming
    • Horticulture
    • Animal health
    • Rural business
    • Rural life
    • Rural technology
    • Opinion
    • Audio & podcasts
  • Weather forecasts
    • All Weather forecasts
    • Kaitaia
    • Whangārei
    • Dargaville
    • Auckland
    • Thames
    • Tauranga
    • Hamilton
    • Whakatāne
    • Rotorua
    • Tokoroa
    • Te Kuiti
    • Taumaranui
    • Taupō
    • Gisborne
    • New Plymouth
    • Napier
    • Hastings
    • Dannevirke
    • Whanganui
    • Palmerston North
    • Levin
    • Paraparaumu
    • Masterton
    • Wellington
    • Motueka
    • Nelson
    • Blenheim
    • Westport
    • Reefton
    • Kaikōura
    • Greymouth
    • Hokitika
    • Christchurch
    • Ashburton
    • Timaru
    • Wānaka
    • Oamaru
    • Queenstown
    • Dunedin
    • Gore
    • Invercargill
  • Meet the journalists
  • Promotions & competitions
  • OneRoof property listings
  • Driven car news

Puzzles & Quizzes

  • Puzzles
    • All Puzzles
    • Sudoku
    • Code Cracker
    • Crosswords
    • Cryptic crossword
    • Wordsearch
  • Quizzes
    • All Quizzes
    • Morning quiz
    • Afternoon quiz
    • Sports quiz

Regions

  • Northland
    • All Northland
    • Far North
    • Kaitaia
    • Kerikeri
    • Kaikohe
    • Bay of Islands
    • Whangarei
    • Dargaville
    • Kaipara
    • Mangawhai
  • Auckland
  • Waikato
    • All Waikato
    • Hamilton
    • Coromandel & Hauraki
    • Matamata & Piako
    • Cambridge
    • Te Awamutu
    • Tokoroa & South Waikato
    • Taupō & Tūrangi
  • Bay of Plenty
    • All Bay of Plenty
    • Katikati
    • Tauranga
    • Mount Maunganui
    • Pāpāmoa
    • Te Puke
    • Whakatāne
  • Rotorua
  • Hawke's Bay
    • All Hawke's Bay
    • Napier
    • Hastings
    • Havelock North
    • Central Hawke's Bay
    • Wairoa
  • Taranaki
    • All Taranaki
    • Stratford
    • New Plymouth
    • Hāwera
  • Manawatū - Whanganui
    • All Manawatū - Whanganui
    • Whanganui
    • Palmerston North
    • Manawatū
    • Tararua
    • Horowhenua
  • Wellington
    • All Wellington
    • Kapiti
    • Wairarapa
    • Upper Hutt
    • Lower Hutt
  • Nelson & Tasman
    • All Nelson & Tasman
    • Motueka
    • Nelson
    • Tasman
  • Marlborough
  • West Coast
  • Canterbury
    • All Canterbury
    • Kaikōura
    • Christchurch
    • Ashburton
    • Timaru
  • Otago
    • All Otago
    • Oamaru
    • Dunedin
    • Balclutha
    • Alexandra
    • Queenstown
    • Wanaka
  • Southland
    • All Southland
    • Invercargill
    • Gore
    • Stewart Island
  • Gisborne

Media

  • Video
    • All Video
    • NZ news video
    • Herald NOW
    • Business news video
    • Politics news video
    • Sport video
    • World news video
    • Lifestyle video
    • Entertainment video
    • Travel video
    • Markets with Madison
    • Kea Kids news
  • Podcasts
    • All Podcasts
    • The Front Page
    • On the Tiles
    • Ask me Anything
    • The Little Things
  • Cartoons
  • Photo galleries
  • Today's Paper - E-editions
  • Photo sales
  • Classifieds

NZME Network

  • Advertise with NZME
  • OneRoof
  • Driven Car Guide
  • BusinessDesk
  • Newstalk ZB
  • Sunlive
  • ZM
  • The Hits
  • Coast
  • Radio Hauraki
  • The Alternative Commentary Collective
  • Gold
  • Flava
  • iHeart Radio
  • Hokonui
  • Radio Wanaka
  • iHeartCountry New Zealand
  • Restaurant Hub
  • NZME Events

SubscribeSign In
Advertisement
Advertise with NZME.
Home / Business

Market Watch: How tech revolution toppled tomato sauce giant

Liam Dann
By Liam Dann
Business Editor at Large·NZ Herald·
3 Oct, 2019 11:32 PM4 mins to read

Subscribe to listen

Access to Herald Premium articles require a Premium subscription. Subscribe now to listen.
Already a subscriber?  Sign in here

Listening to articles is free for open-access content—explore other articles or learn more about text-to-speech.
‌
Save

    Share this article

Market Watch: How the tech revolution toppled tomato sauce giant.

It's easy to see how the tech revolution has disrupted industries like media, transport and tourism - just think Facebook, Uber or Airbnb.

But if you want an example of the depth to which tech is shaking the foundations of the corporate world, take a look at ketchup giant Kraft Heinz, says Pie Funds chief investment officer Mark Devcich.

Less than three years ago its shares were trading close to US$100 apiece. This week they were at just US$27.

Against the backdrop of a surging Wall Street bull market, that represents an astounding fall for a giant in the consumer food space.

What happened?

Advertisement
Advertise with NZME.
Advertisement
Advertise with NZME.

READ MORE:
• MarketWatch: FOMO driving the stock market to fresh high
• MarketWatch: Eight big predictions for 2019
• Market Watch: If you'd picked these stocks you could retire early
• Market Watch: Why shares are hitting new highs as economic fears rise

Basically, boutique hipster food brands – trading on organic, transparent, holier than thou branding - now have an opportunity to grab market share that did not exist for them just a few years ago.

Twenty years ago Kraft Heinz was one of the few companies that could spend millions and millions of dollars to have national advertising on TV, Devcich says.

Advertisement
Advertise with NZME.

"Whereas a start-up brand these days can spend a relatively small amount on targeted advertising through Facebook and Google.

"It can outsource its distribution to Amazon, it can rent factory space by the hour and all this is reducing the barriers to entry."

It's made previously fixed costs much more variable, he says.

"And much more competition has come into the market, which has basically taken market share away from Kraft Heinz and you can see it in the share price. It's really struggling."

While traditional companies have struggled, there has been massive growth on Wall Street for the technology sector.

The US market has risen about 225 per cent since the start of the bull run more than a decade ago. By comparison, the rest of the world is up just 65 per cent

Why has the US done so well?

Mainly due to technology companies, Devcich says.

"We can see that in the Nasdaq index, which is full of tech companies and up over 300 per cent in that time."

The change had been driven by three big technological changes in the past two decades or so, he says.

Advertisement
Advertise with NZME.

It started with fixed-line broadband, which had allowed streaming and cloud computing, then we saw 4G, which enabled more mobility and the rise of phone apps like Google maps and Uber.

The next wave will come from the rollout of 5G technology which is going to enable the internet of things, Devcich said.

"It's basically all your devices being connected together."

All of these innovations were making the economy more efficient and reducing costs for consumers.

For investors, the rapid pace of change means constantly thinking about what are the technological innovations that will drive change, Devcich said.

And then you had to assess how they would affect particular industries, such as consumer brands - for example, Kraft Heinz.

Advertisement
Advertise with NZME.

"We've seen companies in New Zealand under threat from streaming video - Sky TV, shareholders have obviously had a painful experience from the disruption that's happened there."

Something like 5G was only going to further bolster the disruptive tech companies.

"A lot of applications that will come about from 5G haven't even been thought about yet," Devcich said.

"It's going to mean more connected devices, by some estimates there'll be 20 billion connect devices by 2020. This will make things far more efficient. There will be some technology companies that don't even exist yet that will become global leaders based on 5G technology."

- The Market Watch show is produced in association with Pie Funds

Save

    Share this article

Latest from Business

Premium
Retail

'Give it a second chance': Ruby's recycled clothing venture takes off

06 Jul 03:00 AM
Premium
Opinion

Opinion: What to do if you have been left out of a parent's will

06 Jul 12:00 AM
New Zealand

26-year-old beats seven finalists to win Young Farmer of the Year

05 Jul 11:41 PM

Audi offers a sporty spin on city driving with the A3 Sportback and S3 Sportback

sponsored
Advertisement
Advertise with NZME.

Latest from Business

Premium
'Give it a second chance': Ruby's recycled clothing venture takes off

'Give it a second chance': Ruby's recycled clothing venture takes off

06 Jul 03:00 AM

Miller-Sharma aiming for 25% of revenue from non-new clothing by 2030.

Premium
Opinion: What to do if you have been left out of a parent's will

Opinion: What to do if you have been left out of a parent's will

06 Jul 12:00 AM
26-year-old beats seven finalists to win Young Farmer of the Year

26-year-old beats seven finalists to win Young Farmer of the Year

05 Jul 11:41 PM
Premium
Trump’s finances were shaky. Then he began to capitalise on his comeback

Trump’s finances were shaky. Then he began to capitalise on his comeback

05 Jul 08:00 PM
Gold demand soars amid global turmoil
sponsored

Gold demand soars amid global turmoil

NZ Herald
  • About NZ Herald
  • Meet the journalists
  • Newsletters
  • Classifieds
  • Help & support
  • Contact us
  • House rules
  • Privacy Policy
  • Terms of use
  • Competition terms & conditions
  • Our use of AI
Subscriber Services
  • NZ Herald e-editions
  • Daily puzzles & quizzes
  • Manage your digital subscription
  • Manage your print subscription
  • Subscribe to the NZ Herald newspaper
  • Subscribe to Herald Premium
  • Gift a subscription
  • Subscriber FAQs
  • Subscription terms & conditions
  • Promotions and subscriber benefits
NZME Network
  • The New Zealand Herald
  • The Northland Age
  • The Northern Advocate
  • Waikato Herald
  • Bay of Plenty Times
  • Rotorua Daily Post
  • Hawke's Bay Today
  • Whanganui Chronicle
  • Viva
  • NZ Listener
  • Newstalk ZB
  • BusinessDesk
  • OneRoof
  • Driven Car Guide
  • iHeart Radio
  • Restaurant Hub
NZME
  • About NZME
  • NZME careers
  • Advertise with NZME
  • Digital self-service advertising
  • Book your classified ad
  • Photo sales
  • NZME Events
  • © Copyright 2025 NZME Publishing Limited
TOP