Spreading out into olive oil

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ConAgra Foods hopes to bring the meteoric growth of olive oil to the dairy case with the launch of a Fleischmann's Premium Blend spread made with olive oil. The innovation will be supported with the first TV advertising for the ailing margarine brand since 1995.

Separately, ConAgra will put its renewed marketing muscle behind its Dairy Foods division's Parkay margarine brand this fall with the launch of Parkay Fun Squeeze, a line of kid-targeted blue- and pink-tinted squeeze margarine.

With sales down double digits, Fleischmann's is a perfect candidate for the innovation and marketing spending ConAgra has committed to putting against its varied roster of food brands (AA, Nov. 6).

The brand, which ConAgra purchased from Nabisco in 1998, has in recent years received only minimal support in the way of print and outdoor ads focused on its stick margarine as an ingredient in baking. Now, ConAgra hopes to take advantage of the trend toward healthier eating. "Olive oil is becoming more and more mainstream, with consumption up 50% over the last five years," said Pamela Gaik, associate brand manager on Fleischmann's. "All the magazines are talking about incorporating Italian-style eating as a way of staying healthy, and so we thought adding olive oil would give us more of a modern twist on our product," she said.

The ads, from Grey Global Group's Grey Worldwide, New York, will aim to reach women 45 and older, a slightly younger target than the brand attracts now.

Hormel Foods Corp. takes partial credit for the explosive, double-digit growth of the $400 million olive-oil category since the boom coincided with its launch last year of leading Italian olive-oil brand Carapelli in the U.S. market.

"Previous to our launch, the category was only growing at 4% or 5%, but because of all the attention we've brought to the category and the brand, volume sales are up over 20% for the latest 52 weeks," said Larry Vorpahl, VP-marketing at Hormel and president of Carapelli USA, a joint venture between Hormel and Paris-based Eridania Beghin-Say.

Hormel spent $13 million on an extensive TV and print campaign from Omnicom Group's BBDO Worldwide, Minneapolis, to launch the brand last year whereas media expenditures for the category overall totaled only $8.5 million in 1999. As a result, Carapelli now ranks third in the category, with $31 million in sales. Unilever Bestfoods' leading Bertolli brand, which has roughly $128 million in sales, has recently tapped Bcom3's Bartle Bogle Hegarty, New York, to ramp up its advertising with a TV and print campaign.

The increased attention to olive oil has also sparked renewed ad spending against the Olivio brand of olive-oil-based spreads and dressing founded by former Chrysler Corp. CEO Lee Iaccoca. Olivio, which has grown to $5.5 million in sales since its launch in 1997, spent nearly $1 million on TV advertising this past spring in the New York/New Jersey market.

ConAgra jumps on another success story-H.J. Heinz Co.'s EZ Squirt ketchup-with its Parkay brand launch aimed to increasingly purchase-influencing kids. Based on figures that show the ketchup category grew 5% in incremental sales due to the launch of Heinz's squeezable green ketchup-since followed up with purple ketchup-ConAgra will launch its own squeezable Parkay margarine, according to one retail executive, in electric blue and shocking pink. The margarine will receive local marketing initiatives, including a kids' photo contest and a national ad campaign, also from Grey.

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