Spiraling costs spur food marketers to try a new media recipe

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Food marketers today face a grim reality. Grocery retailers have become powerful, aggressive forces commanding astronomical slotting fees that sap advertising budgets. Meanwhile, TV, a medium once heavily populated with, and easily navigated by, food companies has become cluttered and increasingly unaffordable -- especially on ever-tightening profit margins.

Instead of responding to the harsh landscape with trepidation, food marketers are plunging forward with creative solutions in the hopes of surmounting tight budgets and media cost constraints.


Some of the most imaginative approaches have come from major players such as Kraft Foods, M&M/Mars and Lipton, who are trying to maximize budgets with innovative Internet plays, bundled budgets and standout creative in outdoor, in-store and on TV.

Moving beyond increasingly pricey traditional media is a goal of H.J. Heinz Co., which has so far only dabbled slightly in media such as the Internet, according to Chuck Lanphear, media director at Heinz. "We do need to address the issue," Mr. Lanphear said. "Although rising TV costs have been going on for the better part of 15 years, what has happened in the last year or so is that dramatic interest and spending [on TV] by new categories such as pharmaceuticals, high-tech, telecommunications has upped the ante [of TV ad costs] by easily 10%-15% annually."

Heinz hopes to use online elements to launch a new product. The introduction of a new Starkist tuna-in-a-pouch product will be the company's first step into exploring how various brand messages can be imparted creatively on the Internet, according to Mr. Lanphear.

Hormel Foods Corp., never a particularly big spender on TV, is also looking at ways around the medium as well.

"The more expensive this medium becomes, it makes us re-evaluate the wisdom of putting as much into TV," said Jeff Grev, group product manager. "We've begun to look at other vehicles such as in-store media, including shelf-talkers and instant coupon machines that are right there in front of a new product to get people to notice it."


With average slotting costs for one item to be placed on the shelf nationally hitting somewhere around $1.4 million, getting a product noticed at the point of purchase is crucial. Sen. Kit Bond, (R., Mo.), wants to put an end to such high fees, pledging to put $900,000 toward investigating whether slotting fees are discriminatory. But for now they remain a reality.

For M&M/Mars, higher costs of doing business, plus an increasingly elusive teen and young adult target, has demanded creativity. The chocolate marketer has branched out in the last year from previously prime-time-heavy TV media buys to marketing plans that include everything from events to the Internet.

"Our total communications budget -- which five or six years ago meant media -- is up slightly, and a very significant portion of the money within that mix is going to print, radio, outdoor and non-traditional efforts," said Bob Gamgort, general manager of chocolate at M&M/Mars.

The examples of such efforts at the company are numerous. For the relaunch of Milky Way Dark as Milky Way Midnight in April, M&M/Mars and D'Arcy Masius Benton & Bowles, St. Louis, touted the brand's "Seize the night" theme via edgy print and outdoor buys; motorcyclist samplers visiting hot night spots and an Internet Web cast featuring alternative bands. To play up crucial seasonal occasions for confectionery brands, including Christmas, Easter and Halloween, M&M/Mars has developed a direct marketing approach for its businesses, sending out customized newsletters via the Internet that include recipe ideas and usage suggestions such as creating an M&M's wreath.

The effort offers "an opportunity to create a relationship with consumers four or five times a year," Mr. Gamgort said.


Even within the TV medium, M&M/Mars has broken out of the box, getting noticed through the clutter of traditional spots by forging a deal with NBC to make its M&M's spokescharacters the "celebrities" touting new fall episodes of "Will & Grace" and "Frasier."

Like with Milky Way Midnight, 30-second TV ads in prime time will not be the centerpiece for the launch of its new Celebrations box chocolates this holiday season. Instead, M&M/Mars will impart its message that the new brand redefines gift chocolates through a humorous "bad gift" theme conveyed via print ads; :10s during daytime programming; three spots that will run only on the Internet; and a "Bad Gift Roadshow" event in New York the day after Thanksgiving. And, Mr. Gamgort said, "that's the marketing model for the future."


That said, though, Mr. Gamgort admitted, "We're all on the edge here. While print and radio are more targeted and you know what you're getting, event marketing and chat rooms? This stuff is way out there. We still have no idea what we're getting into, what we're going to get out of it."

Still, with the inflation on traditional media so high, he said, "We're placing our bets outside of it."

Kraft Foods is one marketer who led the charge into unchartered non-traditional territory in 1994 with the launch of a quippy outdoor campaign for its Callard & Bowser-Suchard unit's "curiously strong" Altoids mints.

"There was not a huge budget [for Altoids] and that, in hindsight, has been an advantage, making us look harder at how we could connect with consumers," said Barbara Ford, VP-advertising at Kraft. Budget constraints demanded that Kraft initially reach out to a narrowly defined upscale, young and active target for the brand via sides of buildings and transit posters. Although recent efforts, from Leo Burnett USA, Chicago, have included more traditional print media, the buy eschews typical package-goods vehicles such as women's service magazines. Instead, ads appear in fringe publications including art titles that tie in with the brand's support of emerging artists in an annual "Curiously Strong Art Collection."

The surprise success of Altoids led Kraft to apply what it had learned to more mainstream brands, such as Oscar Mayer ham and its flagship Kraft cheese portfolio.


For the recent relaunch of Oscar Mayer ham, Kraft again was faced with how to make a big statement without a big budget. The message Kraft wanted to drive home was that the reformulated, repackaged ham needed to be looked at more closely to see its high quality. Kraft and its agency, J. Walter Thompson USA, Chicago, developed the "Oscar Mayer like you've never seen before" campaign, which consists mainly of out-of-home and in-store media.

Creative was developed in relation to ad placement, with bus side ads reading, "Honk if you love ham," and shopping cart signs averring, "This space reserved for Oscar."


An important point to remember in these days of new media opportunities and rising costs, Ms. Ford said, is "not necessarily just using different media, but connecting the media with the message. In some cases it is right to question whether or not to use TV, and in other cases you have to look at the types of ways you use TV."

Case in point: Kraft's new initiative for its vast array of Kraft-branded cheeses. The effort, also from JWT, brings together brands such as Kraft Singles and Kraft Cubes, formerly advertised individually under one umbrella theme, "There's something about Kraft cheese."

The bundling will give the brands a greater presence. While Kraft spent a total of $32 million advertising the cheeses separately last year, the new, unified effort will give the overall Kraft brand bigger play.

Such a strategy was also recently employed by Sara Lee Corp.'s Hillshire Farm & Kahn's unit. The unit has for the first time combined its various Hillshire Farm sausage and deli meat lines under one marketing campaign from Euro RSCG Tatham, Chicago, in the hopes of "delivering more marketplace bang vs. operating as a series of smaller products," said Nancy Koglmeier, VP-retail marketing at Hillshire Farm.

Certainly, food marketers have not abandoned TV, despite the costs. But when precious marketing dollars are committed to TV, they want to be sure to stand out.


For Kraft's cheese effort, TV ads employed a creative strategy that was a departure from past efforts. The campaign strays from the more expected food-ad creative to focus on real-life situations that aim to capture consumers' passion for cheese. The ads feature very little sound or dialogue, trying instead to convey the feelings people have about cheese through scenes which rely on visual storytelling.

Such quiet intrusiveness was earlier employed this past April by Bartle Bogle Hegarty, New York, in TV advertising surrounding the launch of Unilever's Lipton Sizzle & Stir meal kits.


"Every year it gets more and more important to stand out and be noticed, to be loud but simple, and to say something relevant and compelling because there is less and less opportunity to talk to consumers and you can't waste any chances," said Bruce Winterton, account director at Bartle.

For Sizzle & Stir, the TV also features very little dialogue, instead conveying the brand's "Surprisingly real" theme through nearly silent scenes depicting realistic, non-traditional families preparing meals. "The ads are intrusive because they begin with an obscure sizzling sound, which reinforces the brand name, and because there's a quietness about them, with very little dialogue and no loud voice-over at the end, which makes consumers stop what they're doing and look up," Mr. Winterton said.


Though initially Lipton was a little anxious about the spots, which stray from the tried-and-true food ads featuring glossy food shots and what Mr. Winterton calls "shiny, happy people," they've become more comfortable as the campaign has been successful, he said. Now that Bartle has developed a focused creative message for Sizzle & Stir, the next step is to extend the campaign across multiple media to make the message that much more pervasive and engaging.

"The traditional model has broadcast TV as a centerpoint; if there's anything left over it's spent on print, anything else left over and it's spent on other things. But that model is constantly being challenged by necessity and by the effectiveness of non-TV media," Mr. Winterton said.

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