Food/grocery

As the cost of food rises, the national food/grocery brands face challenges from every direction, such as Loblaw's resurrection of its No Name line (see p. 24). Meanwhile, keeping up with consumer health trends, competitor product innovation and demands to go green all increase costs. Then, when disaster strikes in the form of a product recall, the fight for more facings seems like a walk in the park. Strategy checked in with two Canadian food manufacturers to see how brands are coping.

As the cost of food rises, the national food/grocery brands face challenges from every direction, such as Loblaw’s resurrection of its No Name line (see p. 24). Meanwhile, keeping up with consumer health trends, competitor product innovation and demands to go green all increase costs. Then, when disaster strikes in the form of a product recall, the fight for more facings seems like a walk in the park. Strategy checked in with two Canadian food manufacturers to see how brands are coping.

MAPLE LEAF FOODS

Toronto-based Maple Leaf faced a crisis last summer when contaminated foods were traced back to one of its factories. The company took immediate responsibility through ads and a microsite, MapleLeafAction.ca. Since then, Maple Leaf launched a new branding campaign in January, sent coupons to those who called the crisis hotline and shifted away from deli toward fully cooked meat and fish dinner solutions. Spokesperson Linda Smith says consumer confidence scores bounced back from 60% last fall to 91% in early December, while 70 to 75% of brand sales have been recovered.

An honest apology

Maple Leaf’s response to the crisis was immediate, as president/CEO Michael McCain addressed Canadians personally: ‘Tragically our products have been linked to illnesses and loss of life,’ he said in a TV commercial last August. ‘Maple Leaf Foods is 23,000 people who live in a culture of food safety. We have an unwavering commitment to keeping your food safe with standards well beyond regulatory requirements. But this week our best efforts failed, and we are deeply sorry.’

‘Meaningful brands are transparent: there’s nothing to hide. Where advertising sometimes created a lot of stigma for itself was [through] a language of ambiguity, which people revolted against. There’s no place for that anymore in the current environment. I think that Maple Leaf is very wise showing this transparency.’ -Ian Mirlin, Ignyte

‘They practiced what I would call full and complete communications: media relations, full-page advertisements in newspapers, web communications. So it wasn’t just that they took the right position, they were aggressive in pursuing and distributing that position to the public.’ -Bruce MacLellan, Environics Communications

Humanizing the lab coats

After the recall ended last year, Maple Leaf bowed a new branding effort by Toronto-based agency John St. to reinforce the enhanced safety message while maintaining an emotional connection. ‘The new campaign features employees who are food safety experts [serving Maple Leaf products to their families],’ says Smith. ‘It is designed to reinforce the confidence people have in our product. These people are stewards of our food safety and, at the same time, moms like you and me.’

‘It’s a nice execution of two messages in one: ‘We have people in white coats who are looking out at our plant for health issues, and they’re ordinary people just like you who go home and eat our products with their families because they trust them so much.” -MacLellan

Beyond deli

Moving forward, Maple Leaf appears to be shifting marketing emphasis away from deli lines most affected by the crisis towards products which meet consumer demands for healthier quick meal options. A current television campaign promoting the Simply Savour line of fully cooked fish, roasts and chicken strips, also by John St., is supported by retail activities.

‘You’ve probably heard the old saying, ‘if you love sausages, don’t visit the sausage factory.’ Unfortunately this whole episode gave everybody a peek inside the sausage factory. And Maple Leaf is going to have to face broader, more long-term issues of the role of sliced meat in a healthy diet. It may be that they need to shift away from the weighting that sliced meats represent in their shelf space [and] put more emphasis into other products that aren’t associated with the crisis.’ -MacLellan

‘I think people are rooting for Maple Leaf. Not only is this a Canadian institution, I believe consumers know that if this unfortunate situation can happen to a reputable company like Maple Leaf, it can happen anywhere. And it causes us all to ask the question: ‘Do I really know what’s in my food?” -Jill Nykoliation, Juniper Park

SUMMER FRESH FOODS

Vaughan, Ont.-based Summer Fresh Foods’ dips, salads, and prepared foods have been leading the quick-gourmet trend in Canada. Founded in 1991 and now ranked in the top 10 SKUs in Ontario by AC Nielsen, the brand is found in all major national grocery retailers, from Walmart to the upscale boutiques. In ’09 it will introduce a new line of lunch and snack items aimed at kids licensing Nickelodeon’s Dora the Explorer and SpongeBob SquarePants. Strategy asked president and founder Susan Niczowski for the insight behind the ‘Food is Fashion’ positioning.

Ingredients story

‘We’ve always focused on the products and their ingredients,’ says Niczowski. ‘Consumers are becoming much more aware of raw ingredients and trends, and they’re much more knowledgeable about what they’re actually consuming.’ Her concerns about what to feed her school-aged daughter spurred the interest in developing the stand-alone dips and snack packs of hummus and flatbreads portioned out for children. ‘We’ve got to get back to the basics and focus on nutrition at an early age, eating properly, sitting down and enjoying your meals as well as being active.’

‘Their ‘Food is Fashion’ strategy – constant innovation, chef-inspired flavors, and discovery-type merchandising – aligns well with the psyche of their core consumer. Their brand’s archetype is about passion, authenticity and storytelling. They connect with their consumer on the intimate level of the senses. A boutique product available in a supermarket. Personally, I love this brand and believe it has great potential.’ -Nykoliation

Affordable luxury

‘With our particular product lineup, people will not be eating out as much [during the recession], so instead of spending $50 in a restaurant, you’re going to treat yourself to that $3.50 dip or tub of salad, so it really is a treat.’

‘Their challenge in the next 18 months is to hold onto their growth, keep their consumer base and attract new consumers in a recessionary period. The trend they’re up against is that everybody’s going back to simpler times. It’s a question for all brands: Am I a luxury? Am I a trade-down? We don’t know yet.’ -Nykoliation

Creating brand advocates

Summerfresh.com provides consumers access to a team of chefs to give feedback and ask questions about products and recipes, says Niczowski, adding that consumers have influenced things like packaging. Interactions at retail – crucial to a brand where the primary marketing strategy is ‘getting the product in their mouths’ – also provide insights.

‘Everybody talks about this new notion of the ‘prosumer,’ which is that hybrid of the consumer and the producer, and they want input into it. Interactive communication is actually a metaphor for business today. The meaningful and relevant brands are prepared to enter into a dialogue with the consumer. The days of the monologue brand are coming to an end.’ -Mirlin

‘This is a discovery brand, and people who like discovery brands like to share. Summer Fresh could reach out to places where people are, the Food Networks, the Chatelaine food section. Instead of owning the conversation, go to where the conversation is and respectfully insert yourself. It’s a brand ripe with stories, and they could be making it easier for consumers who are interested to find those stories.’ -Nykoliation

CATEGORY Rx

‘We’ve all got to get into the personal product business. By personal I mean personally relevant: what about it understands me on a much deeper level? I’d love to see more marketing strategies that said something like ‘start the debate’ or ‘create a nation of cooks’ or ‘start a league of mothers.’ The product is the conduit to it, but we’ve got to stop selling the product and start selling the relationship.’ -Mirlin

‘Societal influences are having an impact. The suggestions to get back to fresh ingredients are numerous – food safety scares, the 100-Mile Diet, the interest in organic. And food manufacturers are responding. In 2008, the most common claim made about new food and beverage products was ‘natural.’ McDonald’s new global initiative features natural ingredients; Lay’s is celebrating its locally grown potatoes.’ -Nykoliation

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