Advertising Age: What is the reason for creating Ms. Filkin's position?
Mr. Lenny: Now that we have the base business turned around and progressing after more than four years of negative business trends, we're ready to focus our sights on innovation from a product and packaging perspective to capture the tremendous growth in the snack category.
Our research shows that over 30% of all calories consumed are snacks, and, in her new position, Donna will concentrate on [areas] where the marketing opportunities exist to capture consumers' insatiable desire for on-the-go-snacking.
AA: How do you intend to reach consumers where and when they're purchasing snacks?
Mr. Lenny: Part of our efforts include expanded distribution to places [where] consumers want to buy their snacks, such as convenience stores. We haven't in the past had the packages and the products that target convenience-store shoppers. We've had some boxes of Ritz and Oreos, but not really a lot of things for people looking for immediate consumption and portability.
Now, to gain entry into the growing c-store business, we're testing a 99 cents Big Bag line that will start to appear in convenience stores on the West Coast by the end of September that includes Ritz Bits Sandwiches with Peanut Butter, Ritz Bits Sandwiches with Cheese, Cinnamon Teddy Grahams and Nutter Butter Bites in convenient packaging.
AA: When will you determine the viability of expanding Big Bags beyond the West Coast?
Mr. Lenny: We will make any expansion decisions around the first of the year. In the meantime, we've expanded our variety pack offerings for back-to-school, which include single-serve bags of mini Chips Ahoy!, Teddy Grahams, Cheese Nips and Ritz Bits Sandwiches that are fun for kids and convenient for moms.
And, beginning in late October, we will introduce Mini Cheese Nips in stand-up resealable packaging, which fulfills a need for hand-to-mouth snacking.
AA: How are things progressing with your refocus on a direct-store-delivery system, which has been used successfully by snack competitors Frito-Lay and Keebler?
Mr. Lenny: We've successfully completed a full conversion in our retail redesign. We began rolling our DSD system in the second quarter of last year, and it took one year to roll out. We continue to learn by doing, gaining experience from customers and salespeople and by results at retail. We're confident that we have the right structure and core processes, which is backed up by four consecutive quarters of sales growth and three of share growth.
AA: What are you doing to continue to build sales for your brands in traditional channels this fall?
Mr. Lenny: We are being very aggressive with seasonal and new items. To support the recent restage of our Teddy Grahams line, we will introduce a special holiday version of the snack cracker with holographic packaging and seasonal shapes, including a scarf and Santa's cap, and a Holiday Chips Ahoy! with chunks of white fudge and dark chocolate that is rich and great for entertaining. . . .
In addition, to capitalize on our tie-in with the National Football League, we will begin to ship a line of Football Oreos in early October with packaging featuring one of four local teams-the New England Patriots, New York Jets, Dallas Cowboys or Cleveland Browns-that are imprinted with helmets and footballs. We will make a big push into all channels for the Football Oreos, with local advertising, to gain excitement and retailer support in the teams' hometowns.
AA: What do you believe is the impact of Ms. Filkin's newly created position?
Mr. Lenny: We now have a 44% share of the $8 billion cookie and cracker category, a category that continues to grow. And we have huge opportunities with our icon brands. We've just begun to scratch the surface in flavor varieties and