Kraft Success Sends More Food Marketers Toward Snacks

NEW YORK (AdAge.com) -- Getting consumers to pay more for less is the holy grail in the tight-margined food business, and Kraft Foods' success doing so with its Nabisco 100-calorie packs over the last 18 months has driven a slew of copycats, from Kellogg Co.'s Keebler Right Bites to Procter & Gamble's Pringles 100 Calorie packs. Now, PepsiCo's Frito unit is readying an estimated $20 million media effort to tout its own 100-calorie Mini Bites as "The right snacks for sensible munching," and the calorie-counting craze is only expected to continue. According to Tom Vierhile, executive editor of Datamonitor's Productscan Online, the number of products touting pre-portioned 100-calories per serving packaging totaled 44 in 2005, up from only Kraft's initial five in 2004. Already this year, Mr. Vierhile said, there are 14 new 100-calorie introductions and he expects more. Kraft's success has certainly been a motivator. Nabisco 100 Calorie Packs -- which offer more than a third less product for the price -- were introduced in July 2004 and recent Information Resources data show sales grew 82.3% to $115 million in food, drug and mass outlets excluding Wal-Mart for the 52 weeks ended March 19. Retail executives have been surprised by the success, guessing consumers would be unwilling to pay for what one Arizona buyer called "products that are overpriced and underfilled."Paying for portion control That same buyer, though, is now predicting success for Frito's launch this spring of Sun Chips, Doritos Nacho Cheese, Cool Ranch and Baked and regular Cheetos in 100 Calorie Mini-Bites packaging. "People seem to be willing to pay to have calorie and portion control," he said. Control appears to be a key motivation of the 100-calorie trend. According to Kellogg spokeswoman Kris Charles, that feeling of control has helped bring new or lapsed users back to the cookie category because the packaging "makes it more acceptable to eat cookies," she said. Kellogg's Keebler Right Bites, though, haven't fared as well as its Nabisco counterparts, with sales totaling only $14 million for the line for the March 19 time period, according to IRI. Kellogg has failed to spend the big media dollars Kraft has levied against its 100-calorie packaging. Kraft spent a total of $34 million in media to tout the packaging and product tweaks for the various packs from July 2004 through December 2005, while Kellogg has spent nothing, relying instead on in-store efforts.Kraft extends line To take advantage while the getting is good, Kraft continues to extend its 100-calorie idea; this month it adds Ritz Chip and Wheat Thins Multi-Grain Chip varieties and South Beach Diet Bars and Balance Bars to a portfolio that already includes thin crisp versions of Oreo, Chips Ahoy and Planter's Peanut Butter cookies. In June it expects to launch 100 Calorie Packs of Jell-O Pudding. General Mills has entered the category with 100-calorie versions of Chex Mix Traditional Snack Mix and Pop Secret popcorn, Cadbury Schweppes last year launched a 100-calorie candy bar, Cadbury Thins, and smaller players like Snyder's of Hanover have jumped on board. Already the trend has outlasted the longevity of the carb fad, but whether it moves beyond niche status or not remains to be seen.

Kraft Success Sends More Food Marketers Toward Snacks

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