By all accounts, the biggest driver of growth in the $320 million breath freshener category has been the "strong" mint segment pioneered by Callard & Bowser-Suchard's Altoids. Altoids, along with others that have entered the arena, have seen increases of more than 30% for the 52 weeks ended Nov. 7, according to Information Resources Inc.
But, despite the uproar over mints that pack a punch, the Tic Tac marketer -- and leader in adult breath mints since the late 1970s -- is staunchly remaining true to its heritage brand. Ferrero has no plans for a me-too strong-flavor mint priced higher than the 55› a single pack of Tic Tacs command -- at least for now.
FRIENDLY, NOT STRONG
Marketing efforts, which have increased, still portray Tic Tac as the 11/2 calorie mint that helps consumers breathe friendly. Strength is not the focus, and that decision seems likely to cost Tic Tac its No. 1 status, at least in the near term. Dollar sales for the 52 weeks ended Nov. 7 show sales in supermarkets, drugstores and mass merchandisers grew a mere 1.6%, to $80.6 million, while Altoids grew 32.9% to $79.6 million, according to IRI.
Brad Maslan, director of marketing for Ferrero, asserts that Tic Tac "is still doing very well" from a volume standpoint, and that by continuing to build on a loyal consumer base with a consistent product and advertising, Tic Tac will prevail.
"We can't just react to what our competitors are doing; we have to be true to ourselves," Mr. Maslan said. "We have built a loyal franchise with consistency, not bringing out new flavors every year, and our advertising historically has been the same, focusing on . . . our point of difference. We've seen a lot of products come and go, and we need to make sure our consumers react positively to what we're doing."
Tic Tac, priced at 55› vs. Altoids' $1.99 and Warner-Lambert Co.'s Certs' Powerful Mints' $1.49, is the clear leader in unit sales, with 120 million units sold in the period ended Nov. 7. But that volume is down 0.9% while Altoids' unit sales grew 33% to 39 million.
"Tic Tac outsells Altoids because it's a more reasonably priced item," said one Midwest retail executive, "but the growth in the category is coming from the premium or `strong' segment."
According to the executive, Ferrero has increased retailer support efforts over the past year by at least 10%, including newspaper inserts and ads in retailer circulars "to hold what they do have."
While Mr. Maslan asserted that the entry of new brands in the category is "hurting our competition more than they're hurting us," an executive close to the company contends Ferrero is "very concerned about the competition and is desperately trying to keep the momentum going on the Tic Tac brand."
Since 1980, eight years after Tic Tac was first introduced in the U.S., the thin plastic container of tiny oval mints with a flip-top lid has been positioned as an adult breath mint that freshens breath as well as other mints twice its physical size.
Advertising, from McCann-Erickson Worldwide, New York, has been primarily TV, maintaining that longtime positioning. And a new campaign for 2000 will not differ from the strategy.
"Ferrero has a fervent belief in the power of the brand and in the basics of what has made it what it is," said Bill Grogan, managing group director at McCann.
Competitive Media Reporting data reveal that the marketer spent $13.9 million in 1998, compared with $15.3 million in 1997.