LIPTON EXTENDS RAGU LINE WITH CHEESE CREATIONS: $15 MIL IN ADS TO SUPPORT; RIVAL PREGO ALSO PLANS A $10 MIL BLITZ

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Unilever's Lipton unit in January is launching a Ragu line extension called Cheese Creations, backed by an estimated $15 million ad campaign.

The introduction into the hotly competitive $1.4 billion pasta sauce category comes e as rival Campbell Soup Co. plans a direct assault on the No. 1 Ragu brand in the form of an estimated $10 million Prego campaign that takes on competitors by name.

PREGO TARGETS ALL

Campbell won't discuss the new commercial now in production, from Foote, Cone & Belding, New York. The ad is said to challenge several competing brands in addition to Ragu. Prego ads for several years have taken on Ragu, claiming it isn't as thick as Prego.

A similar strategy also is being tried by Borden's Classico, now running a TV spot from Bozell, comparing it to Prego and others, and saying Classico doesn't contain corn syrup like the others do.

With its new product -- marketed in Double Cheddar, Roasted Garlic Parmesan and Spicy Cheddar & Tomato -- Ragu appears to be targeting Kraft Foods.

In an unusual ploy, Ragu Cheese Creations is aiming at macaroni and cheese brands. The new sauce is a hybrid product, since Ragu will be telling consumers they can use it with pasta shells, as an alternative to packaged macaroni and cheese.

CHEESE CATEGORY IS HOT

Sales materials from Lipton state that cheese is a $6 billion category and note the macaroni and cheese dinner category has a strong growth trend. Cream sauce consumption is up 30% since 1993, the materials state.

Lipton is telling retailers that "mainstream" pasta sauces like Ragu command 60.9% of dollar sales in the pasta sauce category, with premium accounting for 24.5% and price brands holding 14.6% of sales.

The company has set up a Web site game for Cheese Creations (www.eat.com/cheese-creations), and although it won't discuss the TV effort from Ammirati Puris Lintas, New York, a clue might be obtained in the sales materials that show a "Ragu family photo album," asking the trade to "Say cheese, and see what develops."

Excluding Kraft's Cheez Whiz packaged in jars, with $63 million in sales, and alfredo varieties of popular pasta sauces, the glass jar-packed Cheese Creations could be a category first.

Prego's 22.5% share trails Ragu at 36.8% according to Information Resources Inc.

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