Pinnacle Exec VP Bob Sperry, also chief operating officer of C. Dean Metropolous, Hicks Muse's partner company in the Pinnacle purchase, said the company, acquired nearly two years ago, is not yet ready for sale, as its brands aren't healthy enough to attract potential buyers. But, since a sale is the eventual goal, "going into the upfront media market, we're committing unprecedented dollars against Hungry Man and Swanson. To turn neglected brands around, there are no short cuts."
According to Dianne Jacobs, senior VP-general manager of frozen foods at Pinnacle, the company will spend roughly 30% more in advertising on Hungry Man this year-almost $30 million-because advertising has worked well for the brand. In January of last year, Pinnacle launched a large-scale TV and print effort from Interpublic Group of Cos.' Foote, Cone & Belding Worldwide, New York, that positioned Hungry Man as more filling than other meal options by using the tagline "It's good to be full."
From the week the campaign went on air, Ms. Jacobs said, the brand has been "on fire." According to Information Resources Inc., sales of Swanson Hungry Man frozen dinners were up 15.1% to $173.2 million for the 52 weeks ended March 23. Ms. Jacobs said she expects the brand to reach $200 million in sales this year.
Usually, Mr. Sperry said, Hicks Muse looks to sell its food company investments in a range of three to five years, so it's a bit early. "No CEO of a public food company wants to tell people they spent half a billion dollars on a brand and then have to turn around within the first quarter and start explaining why the business is still down." That said, Mr. Sperry acknowledged that in the leveraged buyout business "every business is always for sale."