CHICAGO (AdAge.com) -- Consumers may be cutting back on lattes, casual dinners at restaurants and trendy clothes, but they're not forsaking their pets. Bill Pearce, senior VP-chief marketing officer, Del Monte Foods, recently found as part of consumer research that consumers will sacrifice what they put on their own plates before trying to save pennies on Fido's treats. As a result, he's putting the company's Pup-Peroni dog treats on TV for the first time.
Mr. Pearce, 46, brings a wealth of consumer-package-goods knowledge to his post. He spent several years in Taco Bell's marketing department, including a stint in 2006 as CMO. He left the company to serve as CEO at Foresight Medical Technologies, a medical-device startup, until joining Del Monte last May. Mr. Pearce was VP-marketing of Campbell Soup Co. for a year, ending in 2004. Prior to that, he held a variety of marketing positions over nine years with Procter & Gamble. According to TNS Media Intelligence, Del Monte spent $11 million in measured media during 2007. But spending is up following Mr. Pearce's arrival. Del Monte spent $12.4 million during the first 11 months of 2008, excluding outdoor work. Mr. Pearce also moved all of his pet-food business, including Nine Lives, Milk Bone, Pup-Peroni, Meow Mix and Snausages, to DraftFCB, Irvine, following a consolidation and a review. Del Monte's human-food businesses include College Inn, S&W and Contadina, but the lion's share of ad spending is devoted to the animals.
Mr. Pearce said in an interview with Ad Age that he'll be focusing on Del Monte's core brands, looking for ways to contemporize them. One such effort will be Del Monte's $8 million campaign for Pup-Peroni, which is unprecedented in size for the company.
Ad Age: What made the Del Monte job so appealing?
Mr. Pearce: Very few times do you get to work for a company and have the wind at your back. There have been plenty of times I've had the wind at my face, and I can tell you that the wind at your back is better. They've got a great stable of brands that are understandable, and the chance to revitalize and contemporize them and set them up for the current environment was a terrific opportunity I couldn't pass up.
Ad Age: Which brands do you mean? And how much more support?
Mr. Pearce: For competitive purposes, I will hold that back. But from the publicly available information, the company has spent 30% more on marketing in this fiscal year than they did last fiscal year, and we're going to spend a more incremental of that going forward.
Ad Age: What are the biggest changes on the food side in recent years?
Mr. Pearce: For the first time, Americans recognize it's important to live a healthy lifestyle. They have to eat better. It's not about the magic molecule that's going to magically help them lose weight. It's eating more of the better foods, eating at the right times, right amounts, getting the right balance of exercise and sleep.
Ad Age: How is the current economy shaping the pet-food category?
Mr. Pearce: What we've seen in the pet-food and snacks category is that whatever this economic environment and whatever coping mechanisms consumers have in place, they haven't walked away from the brands they love. If they change habits at all, they're looking for better value. On the pet-food side, feeding and treating haven't changed at all. Pet food is one of the things that [consumers] can tell you, "I will change what I feed my family before I change what I feed my dog."
Ad Age: Why do you think that is?
Mr. Pearce: Thirty years ago dogs slept in the basement. Today half of all pets sleep in the bed with their pet parents. If you're sleeping in bed with your dog, cutting back on their food or treats is one of the last things you're going to do. It's a valued member of the household and it's an expression of love. People don't cut back on expressions of love.
Ad Age: Why pick Pup-Peroni?
Mr. Pearce: We decided Pup-Peroni was going to be one of the first brands [to build]. We have a number of equities in the portfolio we have identified as having significant upside, and you will see an increase in activity from Del Monte in the pet category.
Ad Age: How did pet food weather the crisis of 2007?
Mr. Pearce: From a category standpoint, the wet-pet-food category didn't bounce back as strongly as dry food, but dry food came back stronger, and the recognized brands tended to do the best overall.
Ad Age: Why?
Mr. Pearce: Trust, it comes down to trust. I'll boil it down to that.
Ad Age: With your fast-food background, what's your take on what's going on in value? Is this smart or sustainable?
Mr. Pearce: There are two things that drive the QSR work, and it's convenience and value, and depending upon the economic climate those competing forces move. Right now value is king, and in a different economic environment, convenience or an indulgent new product would do really well. Right now the brands that have a clear value message are going to do very well.
Ad Age: What has the economy done to the grocery business? There are more people shopping, but with fewer dollars to spend. Has it gotten more competitive?
Mr. Pearce: I don't know if it's gotten more competitive. The competitive landscape has changed and the economic environment that we're in right now is different but probably equally as competitive as a few year ago, but we're competing in a different arena.
Ad Age: How so? Take the human-food side, for example.
Mr. Pearce: We've taken [steps] to attract new users to our franchise. It goes together with the fact that more people are realizing they have to eat better, and that's an opportunity we can excel at if you look at what we're doing as far as the packaged-product business. We're all about attracting new users to a firm that's about consumer preference and convenience; most of the business is refrigerated fruit in single-serving sizes.
Ad Age: What role do you feel marketing plays in your organization?
Mr. Pearce: It is our job to define the future and make the case for investment. Del Monte needs marketing to be consumer-centric and customer-facing. If we do that we will take the brands in new directions and drive sustainable growth.
Ad Age: Do you feel heightened pressure to show ROI for advertising and marketing?
Mr. Pearce: Not heightened; it's always been high. It is my goal to see a positive ROI for all of our marketing investments, regardless of the vehicle. It's marketing's role to identify the best investments and then execute in a way that delivers an attractive return for the shareholders.
Ad Age: Can you speak to marketing outside your category? What are some of the trends you're seeing? Or changes on the horizon?
Mr. Pearce: This is a great time for marketers to increase their messaging and hone their messages. We will look back in 10 years and see that the brands that stayed the course and increased their consumer relevancy in tough times will be rewarded.