Unilever expands Slim-Fast to create a diet megabrand

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Increased competition in the booming diet arena has sent Unilever scrambling to extend its Slim-Fast brand into convenient-meal segments, including soups and pastas.

Later this month, Slim-Fast Foods will launch a total of 15 products, from sippable soup cups to boxed pasta meals, in an effort to address dieters' desire for more variety in weight-loss products, something they increasingly are able to get from a growing number of small players entering the category, including Atkins Nutritionals.

"Previously, consumers on the Slim-Fast diet plan had to have [Slim-Fast] shakes for breakfast and lunch and a sensible meal for dinner. Now we're really expanding their options so that one or two meal replacements a day becomes much more doable," said Michiel Kruyt, VP-marketing for Slim-Fast.

Slim-Fast is backing the extensions with what Mr. Kruyt described as "heavy support," including TV, sampling, online efforts and newspaper coupons beginning in September. Spending wasn't disclosed, but Unilever has spent more than $100 million annually on Slim-Fast, which is likely to vie with Dove in 2003 as Unilever's most advertised U.S. brand.

The Slim-Fast launch comes after Unilever reported in April that its first-quarter food revenue was dragged down 5% by a 17% decline in Slim-Fast sales. Mr. Kruyt said the slow first quarter had to do with timing of the new-product announcements, scheduled for the back half of the year, and increased competition from smaller players. Nevertheless, he said, the soup and pasta introductions come after lengthy research and development, including a test of similar products in Europe starting in the U.K. nearly two years ago.

Unilever has told retail executives it delayed initial plans for an earlier U.S. rollout to ensure it has production and logistics capacity to meet what it expects to be heavy demand. Testing via VNU's ACNielsen Bases indicates the soup line alone could be a $180 million business, said an executive familiar with the situation.

Part of the reason Slim-Fast shied in the past from savory foods was difficulty developing good-tasting products, something Mr. Kruyt said food expertise from Unilever, which acquired the brand in 2000, helped overcome. Ads from Grey Global Group's Grey Worldwide, New York, will focus on flavor.

covering the basics

Even as it enters new categories, Slim-Fast hopes to strengthen its base shakes and bar businesses with a low-carbohydrate snack bar and a range of meal bars layered with jelly or caramel. Slim-Fast will also enter the soy-drink category, with two ready-to-drink varieties, chocolate and vanilla, that will be supported with print targeted at people who are lactose intolerant.

The brand also recently extended into frozen novelties (AA, May 5, 2003), with a 110-calorie fudge bar with 1.5 grams of fat. Ads for the frozen products break this month from Grey.

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