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Updating the bagel and other longtime pantry staples

December 03, 2007|From the Associated Press

MOUNTAIN LAKES, N.J. — The talking grandmother-shaped syrup bottle is back on television ads for Mrs. Butterworth's. The bespectacled Vlasic stork is hawking pickles again too.

Boxes of Swanson TV dinners this year went back to their original teal color scheme, and portion size has been reduced.

All these once-heralded labels have come under the ownership of Mountain Lakes-based Pinnacle Foods Corp., whose strategy is to purchase tired but well-known packaged food brands such as Lender's Bagels, Vlasic Pickles and Mrs. Butterworth's and reintroduce them, adding modern-day twists.

"We are a company of iconic brands that are very much part of the fabric of Americana, each of which has some great history and heritage," said Jeffrey Ansell, Pinnacle's chief executive.

Consumers know the products from ad campaigns of decades ago, and the company is trying to capitalize on that recognition, he said.

But there's a challenge: The American diet has changed. Besides fried chicken dinners and breakfast biscuits, people want healthful options, prompting Pinnacle to add new products.

As a result, Hungry-Man frozen dinners will offer new grilled entrees next year and Lender's has introduced a new whole wheat variety.

"We have to adjust our new product approach to reflect these trends," Ansell said.

He said consumers responded well to Log Cabin's introduction this year of a 100%-pure maple syrup product in an old-fashioned, Vermont-style country jug.

"It's important that new ideas match the essence of the brand and what users of the brand respond favorably to," Ansell said.

He said the company's net sales are up nearly 4% so far this year.

"We are encouraged by our improving sales trend, yet we are still early in our strategic shift toward increased consumer marketing, which began in 2007," he said.

Relying on nostalgia isn't a bad way to generate sales, especially with Baby Boomers, said Marcia Mogelonsky, an analyst with Chicago-based market research firm Mintel International Group.

"The basic strategy to revive old brands is never a bad one if the old ones were healthy and had good sales," she said. "A lot of Boomers probably missed those brands."

Many of the company's labels have been acquired from other companies where they really didn't fit. Pinnacle went through its own acquisition this year when private equity firm Blackstone Group purchased it in February for $2.16 billion.

Armour's canned meats didn't really match with Dial soap. Duncan Hines baking mixes weren't a natural fit for Procter & Gamble Co.

"A company like P&G, which owns a bazillion brands, didn't have time to baby-sit, no time or energy to take care of all these little brands," Mogelonsky said. "They [Pinnacle] adopt orphan brands that have not really fallen on hard times but have been eclipsed by newer brands."

Pinnacle takes the latent equity in the label and makes it relevant to customers today, said Andy Reichgut, the company's vice president of marketing.

Eric Kastel, an associate professor at the Culinary Institute of America, said consumers do latch onto the old, and a more healthful product would encourage them to return.

"In general, the American public is getting more health-conscious about everything," he said.

Pinnacle added whole grain options to Aunt Jemima's frozen breakfast items like pancakes and French toast and a whole wheat flavor to Lender's selection of frozen and refrigerated bagels. It's also moving Duncan Hines to the freezer section for the time-starved baker. Instead of needing an egg and a mixing bowl, brownies go right into the oven.

The strategy with Lender's is to promote the bagel as a healthful food that can be eaten at any time of day, said Ray O'Brien, the label's vice president. He said the brand, now in its 80th year, previously was losing sales.

"What we're trying to do is take the . . . Lender's name and see how we can rekindle it and make it as contemporary and relevant for today," he said. "Something you might have had years ago is still relevant for today."

He said sales were about $100 million last year, up 5%.

Pinnacle is spending about $25 million this year to rebrand the label. Pinnacle acquired it in 2004 from ailing Aurora Foods, which had purchased Lender's from Kellogg Co. in 1999.

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