Kraft to introduce leaner Lunchables

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Kraft Foods' will launch a nutritious line of Lunchables in January, backed by a major media push, in a bid to boost the faltering $6oo million-plus brand, which has been vilified by the press as one of the culprits in the childhood-obesity epidemic.

The Oscar Mayer Lunchables franchise, suffering from flat to declining sales compared with the double-digit gains of early last year, will be buoyed by the introduction of four varieties dubbed Fun Fuel that are developed in conjunction with the USDA Food Pyramid Guide.

The move stems in part from the frenzy of media attention given to the childhood-obesity epidemic, coverage that often mentions Lunchables' high fat and sodium content as part of the growing problem. Another driver is the recent success of a healthier lunch-kit line for kids from upstart Funny Bagel Food Co.

The Fun Fuel lineup includes chicken or ham wraps or turkey or ham bagel sandwiches, all with Kraft's reduced-fat cheddar cheese along with 100% juice fruit punch and portable low-fat yogurt. Existing Lunchables kits include 10% juice drinks, chips and candy.

Tim Cofer, senior category business director of Lunchables, said that Fun Fuels, similar to the low-fat Lunchables offered since 1996, give mom more convenient, balanced choices that at the same time offer fun and foods she knows her kids will eat. The regular Lunchables "lean" turkey-breast variety has 20 grams of fat and 1,730 milligrams of sodium.

Meanwhile, Funny Bagels, a 10-item line of bagel-based meals with squeezable yogurts and 100% juice drinks, has grown since last June to distribution in nearly 50% of the country and estimated retail sales of roughly $25 million, according to Funny Bagel Chief Operating Officer Celeste De Armas (although Information Resources Inc. lists its sales for the 52 weeks ended Oct. 6 as $9 million). Yet, Kraft has taken notice of the small player's trajectory.

Lunchables sales fell almost 1% to $611 million for year ended Oct. 6, according to IRI, though Mr. Cofer said the franchise is "growing across all outlets."

Kraft expects that the Fun Fuels varieties will be incremental to its existing lineup, and as a result plans to allot a separate media budget for the line beyond the $20 million Taylor Nelson Sofres' CMR reported it spent on Lunchables last year. A heavy TV ad buy targeting moms with the message of how the Fun Fuel components fit into Food Pyramid guidelines will break in March, and print ads touting on-pack games and the great taste to kids will break in April, according to company sales materials. Radio, Internet and in-store promotions are also planned. WPP Group's J. Walter Thompson, Chicago, handles.

Retailers are enthusiastic about the products, given the flat category and the lackluster response to Kraft's extensions to the brand in recent years, among them waffles and pancakes and Fun Snacks cookies and crackers (AA, March 12, 2001). Fun Fuel are the first lunch items launched under the Lunchables banner in two years.

"Given the media emphasis on obesity, [Fun Fuels] is definitely timely ... and I think that it could attract a mother who might have shied away from buying Lunchables before," said one retail executive. Many parents, she said, have suffered the disdain of their children by resisting demands for the product, hot in schoolyards, but this might allow them to "give in and feel a little less guilty."

Julie Walsh, a spokesperson for the American Dietetic Association, cited Kraft's launch as part of the food industry trend to offer healthier choices. But, she said, while such a switch is great, "what would be healthiest is if parents were to make healthy lunches themselves with whole fruits and vegetables."

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