Hicks Muse, together with food-industry partner C. Dean Metropolous & Co., formed Pinnacle Foods in May to house under-marketed brands from now-defunct Vlasic Foods. Now Pinnacle has committed to spending $35 million on product improvements, innovation and advertising for Swanson this year. Efforts include a $9 million TV effort bowing this week for Hungry Man from Interpublic Group of Cos.' Foote, Cone & Belding Worldwide, New York, and the introduction of Swanson Bowls in March. Pinnacle is also testing TV ads for Vlasic pickles, determining how to best use the classic stork icon.
Hicks Muse has demonstrated before that it believes in marketing, and is "willing to spend $1 to make $2," said Prudential Securities analyst John McMillan.
While Bob Sperry, chief operating officer of Metropolous, believes "advertising isn't the tonic for everything," he said it is imperative to "find a clear position for the brands, and step up to the plate and support them." When the firm created International Home Foods in 1996, its portfolio of brands such as Chef Boyardee and Pam totaled $900 million in sales, a number that grew to $2.6 billion by the time Hicks Muse sold it to ConAgra Foods in 2000. Mr. Sperry said ad spending for Chef Boyardee grew from $6 million to $23 million during that time.
Now, the same attention will be put to its new brands, especially Swanson, which competes against big spenders Nestle USA and Masterfoods USA's Uncle Ben's. Sales of Swanson, the creator of frozen dinners, have fallen 14% from $600 million since 1997, according to Information Resources Inc.
To revive the brand, Hicks Muse hired Dianne Jacobs as senior VP-general manager of the frozen business. During Ms. Jacobs' six-year tenure as VP-marketing for Nestle's Stouffer's line, the brand grew from $495 million to $800 million in sales, through a "team effort" combining product innovation and advertising, she said. Ms. Jacobs, most recently VP-marketing, cookies, at Kraft Foods' Nabisco, plans to "restore the [Swanson] name to the grandeur it once had."
Already Pinnacle has invested $10 million in product upgrades, including branding its chicken Tyson. A TV spot for Hungry Man airing during the Olympics and shows like "Fear Factor" and "King of Queens" touts new 1-pound sizes by humorously showing a man who didn't have a Hungry Man meal being swept away in a storm. The tagline avers, "It's good to be full." Pinnacle will also parlay its acquisition of King's Hawaiian brand Asian rice bowls to a line of Swanson Bowls.
Ms. Jacobs acknowledges that a goal of being No. 1 is unrealistic. The reinvention of Swanson will be a "tough hill to climb," Mr. McMillan said. "Swanson was one of the first frozen foods, so now most of its loyal users are pushing 80."