Masterfoods Returns to Mars

Food Giant Dumps Name and Failed Centralization Effort

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NEW YORK (AdAge.com) -- Turns out Mars by any other name is still Mars. In a sweeping reversal-and a cursory lesson to all who would shed a famous name-Masterfoods USA is dumping the 5-year-old moniker intended to leverage the company's $18 billion in disparate businesses under a single umbrella brand.
Five years ago, Mars changed its corporate name to Masterfoods North America and began centralizing its three top divisions. It's now dumping the Masterfoods name and once again decentralizing its divisions.
Five years ago, Mars changed its corporate name to Masterfoods North America and began centralizing its three top divisions. It's now dumping the Masterfoods name and once again decentralizing its divisions.

Final step
The name change is the final step in the decentralization begun last October of Mars' top three U.S. divisions -- snacks, food and pet food -- and a return to the better-known and far-less-confusing Mars family name preferred by retailers and consumers.

Back in 2000, when Masterfoods North America President Bob Gamgort was VP-general manager of chocolate for Mars and CEO Paul Michaels was president, the grand plan was to unite the distinct divisions called respectively M&M/Mars, Uncle Ben's and Mars Pet Food. Although initially intended to drive efficiencies and cut costs, the idea of shared resources proved ineffective.

Centralization slowed down innovation
In fact, the centralization slowed down innovation, leading Mars to return decision-making power on everything from marketing to manufacturing to its business unit presidents last fall.

The name change is the final nail in the coffin of "the cockamamie bringing together of three disparate businesses that have nothing to do with one another," according to an executive close to Mars.

The executive said that Mr. Michaels acknowledged recently that the company "lost its way in the last few years and forgot who it was, stuck between being centralized and decentralized."

Little impact on consumer
The move from Masterfoods, however, isn't expected to be noticed by the consumer, except in packaging. The divisions didn't market together, though two divisions -- pet food and Uncle Ben's -- use the same agency, TBWA/Chiat/Day, Playa del Rey, Calif. Uncle Ben's spent $22 million in measured media last year, according to TNS Media Intelligence, and pet food spent $92 million. The company's largest-spending division, M&M/Mars, laid out $218 million in measured spending last year, handled by Omnicom Group's BBDO Worldwide and independent Nitro, New York.

But it isn't only consumers that barely noticed the move to Masterfoods.

"I continued to think of them as Mars," said an East Coast grocery executive, one of the many retailers the Masterfoods plan was supposed to benefit. "In meetings, our top executives would always say, 'Who the hell is Masterfoods?' They still call them M&M's."
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