Pillsbury Co.

In 1869, Charles A. Pillsbury bought a one-third stake in a flour mill in Minneapolis that was renamed C.A. Pillsbury & Co. The company was profitable from its first year in operation and, by 1872, was producing 2,000 barrels of flour daily. The company registered its first trademark, Pillsbury's Best XXXX, in 1875. During the 1880s, Pillsbury's production tripled, and by 1887, it was the world's largest flour-milling operation. The company promoted its brands both to the trade and to consumers through newspaper and magazine advertising. Most consumer ads spotlighted the company's 196-pound barrel of flour, the standard consumer size at the time, while some promoted 98-pound sacks, known as halves. Product expansion In the late 1890s, Pillsbury began to introduce other products, including Vitos wheat breakfast food and Germos, a health flour, both brought out in 1897. Flaked Oat Food came out the following year. Vitos was the most successful of those early products, thanks in part to the company's consumer advertising in publications such as Cosmopolitan. Sales of Vitos were large enough to lead Pillsbury to introduce a line of breakfast foods. Revenue from those items enabled Pillsbury to increase its advertising budget for flour as well. In 1889, an English financial syndicate purchased Pillsbury Mills, consolidating it with other mills it bought in the area under the name Pillsbury Washburn Flour Mills Co. Mr. Pillsbury remained managing director of the new company. By 1908, however, the merged company was in financial trouble. It went into receivership, and for about a year, the company stopped creating new advertising, although it continued to buy space in consumer and trade publications. Many of its trade ads sought to reassure its customers that Pillsbury Washburn was still in business. Ads featured headlines such as, "Mills in operation, business resumed, all contracts to be filled." Pillsbury Washburn came out of receivership in 1909, reorganized as the Pillsbury Flour Mills Co. and began to expand its product line into consumer items such as health bran, pancake flour and wheat cereal. "Pillsbury's family of foods," as the company's flours and other products were called in its marketing materials, were advertised to housewives through publications such as Ladies' Home Journal. In 1929, Pillsbury introduced cake flour and began advertising its products on national radio. A proprietary character, Little Nick, was used to introduce Pillsbury-sponsored programming. In the early 1930s, Pillsbury introduced more new grain products, along with a yellow cake mix, a piecrust mix and a hot roll mix. It also acquired other companies, such as Globe Grain & Milling, which allowed it to diversify into new lines such as pancake mixes, biscuit mixes and pasta. The company, later known as Pillsbury Mills, stayed within the kitchen staples segment throughout the 1940s, enlarging its scope by focusing on exporting flour and increasing non-U.S. sales, selling items made specifically for food service and supplying manufactured products?such as dry soup mixes?to U.S. troops fighting in World War II. By the end of the war, it had hired Leo Burnett Co. to work on postwar products with its existing agency, McCann-Erickson. During the 1940s, McCann produced the radio series "Grand Central Station" for Pillsbury. In May 1949, however, Pillsbury dropped McCann in favor of Burnett. In 1949, Pillsbury started a tradition by sponsored the first Grand National Recipe & Baking Contest-later known as the Pillsbury Bake-Off. Billed as the first national cooking competition, it became an annual event. In the 1950s, Burnett moved Pillsbury into daytime radio and TV with sponsorships of three Arthur Godfrey-hosted shows and "The Edge of Night" daytime serial. Pillsbury Doughboy In 1965, Pillsbury launched refrigerated crescent rolls and debuted the "Pillsbury Doughboy" along with the tagline "Nothing says lovin' like something from the oven," both created by Burnett. The Doughboy, also known as "Poppin' Fresh," continues to represent Pillsbury's refrigerated dough products. Throughout the 1950s and '60s, Pillsbury further diversified its output, and by 1963, the marketer's name was on 127 products. In the 1960s, Pillsbury advertised on both radio and TV. In 1964, Pillsbury opened the first Poppin' Fresh restaurant?built around a fresh-pie concept?as part of a joint venture. (Pillsbury sold most of the units in 1983.) In 1967, Pillsbury acquired the Burger King fast-food restaurant chain, becoming the first large U.S. food company to make a significant foray into restaurant operations. Acquisitions accounted for half the company's growth from the mid-1970s through the mid-'80s, with notable purchases such as Totino's Finer Foods, a frozen pizza marketer, in 1975; restaurant chain Steak & Ale in 1976; canned and frozen vegetable purveyor Green Giant in 1979; and ice cream marketer Haagen-Dazs, frozen fish company Van de Kamp and another frozen pizza marketer, Jeno's Pizza, all in the 1980s. From 1972 through 1986, Pillsbury broke sales and earnings records each year through acquisitions, strong sales of its 200 products in 55 countries and the healthy performance of its restaurant chains. In 1984, the company surpassed rival General Mills in volume and in 1986 introduced its most successful internally generated product ever, Toaster Strudel. In 1988, however, earnings fell precipitously, and the company began to rid itself of much of its ailing restaurant business, keeping Burger King, Bennigan's, Godfather's Pizza and Steak & Ale. Burger King, in particular, proved a magnet for criticism in the late 1980s. Many of its new products failed and its advertising was inconsistent, one notorious example being the "Herb the Nerd" campaign. Takeover Meanwhile, the company fought a takeover attempt by U.K.-based Grand Metropolitan (GrandMet, which in 1997 was renamed Diageo after merging with Guinness). Ads portrayed Poppin' Fresh wearing boxing gloves to illustrate the company's antagonism toward the merger. GrandMet succeeded in acquiring the company in 1989 for $5.8 billion, however, at which time it slashed jobs and cut expenses, funneling much of the savings into broader, more consistent advertising campaigns. Pillsbury divisions outside of refrigerated dough, notably Burger King, required much of GrandMet's early attention. The fast-food chain was taken out of Pillsbury's jurisdiction and placed in a separate GrandMet division. GrandMet sold Pillsbury's other restaurant chains, as well as the food division's Van de Kamp and Bumble Bee operations. In 1995, Pillsbury acquired Pet Inc., which brought Old El Paso, Pet-Ritz, Downyflake and Progresso into the Pillsbury fold. A noted advertising campaign premiered almost immediately in support of Old El Paso, a market leader in Mexican foods; the dancing Nacho Man character gained popularity as soon as he was introduced and was revived in many subsequent spots. As the 1990s proceeded, Pillsbury focused increasingly on attracting minority consumers. In addition, the company introduced more than 80 new products in 1994 alone, and its international reach extended to 70 countries. It was also making its first moves into marketing in cyberspace, with a Green Giant/Prodigy tie-in. By the end of the 1990s, baking-related goods, still the company's core focus, remained strong, but sales for brands such as Progresso, Old El Paso and H?agen-Dazs were flat or shrinking. In 1999, Pillsbury relaunched the Green Giant as its advertising spokescharacter for Green Giant frozen and canned vegetables after an eight-year hiatus, but the 75-year-old brand's sales were flat and profit margins remained thin. In July 2000, General Mills announced it would purchase Pillsbury from Diageo in a $10.2 billion deal, combining Pillsbury's brands with its Betty Crocker, Cheerios, Yoplait and Big G brands. The merger was finalized in 2001.

Pillsbury Co.

Featured Stories