Food Cos. Look to Fill Stomachs and Reduce Waistlines
By George Anderson
Hunger pangs be gone. Food marketers, many having been “a day late and a dollar short” when it comes to picking up on diet fads in the past, are trying to create their own with products that make people feel full after ingesting them.
Companies, including Nestlé, Unilever and Kraft Foods, reports The Wall Street Journal, have experimented with special starches and sources of fiber that make people feel full so they can stop eating long enough to lose some weight.
Keeping up with diet fads is a tricky proposition but one that has huge benefits if timed right. While overall food sales growth continues at a two percent pace, hit a diet fad right and returns can be much higher. Unfortunately for CPG manufacturers, get into the game late or miss it altogether and the reverse is true.
“When we launched [Lean Cuisine], it was all about low calories, leg warmers and Jane Fonda,” says Brett White, head of marketing for Nestlé’s Lean Cuisine. “Then it was about low cholesterol and low fat — the cycles are happening faster and faster.”
Unilever, reports WSJ, is betting on a food technology that alters the structure and the coating of fat molecules so that they remain intact as they pass through the digestive system. When they hit the lower portion of the intestine they trigger a response in the body that it is full.
Terry Olson, general manager of marketing for SlimFast, says the technique can convince the body it has consumed 500 calories when it has only taken in 190.
Moderator’s Comment: On balance, have major marketers benefited on their top and bottom lines by trying to stay up with diet fads? What is the key for
CPGs and retailers looking to position themselves in the broad dieting category? –
George Anderson – Moderator
Slotting has held back many good innovations from smaller companies. Even bigger companies often have a hard time breaking onto the shelf with good new products, which aren’t given enough time and promotion before being pulled. As media, I am often sent new products from manufacturers of all sizes to try out or report on. Much of the stuff never seems to find shelf space. Or, shelf space seems to come painfully slowly. I don’t know the ACV right now of a new Weight Watchers yogurt, but it’s a phenomenal product, price is fine and all, but in some markets it’s hard to find. Go figure. More retailers could achieve some differentiation via keeping a close watch on new healthy products, and promoting them, rather than just keeping planograms the same all the time. Reminds me of that old joke, “Planograms should be changed every five years, whether they need it or not.”
Key indicator of a great organization: the time needed to go from conceptualization to market success for a new product. Another key indicator: percentage of sales and profits from new products versus mature products. Every major food manufacturer needs a SWAT team that follows diet fads, formulates products to fit, designs marketing strategies, and test markets diet fashion items. The SWAT team needs to be empowered and motivated to move at very high speed (weeks, not months or years). They need to beat the popular diet cycle, since most diets fail for most people. If they lose weight initially, they usually gain it back. So the search is endless. Diet fads, popularized by the media, have been ongoing for over 100 years. This will not stop.
As a general rule, food manufacturers have been way behind the curve on food trends and diet fads. Occasionally some get lucky and just happen to have a product ready that is in sync with the latest diet fad, but that is the exception rather than the rule. There are much more profitable sales generated at the beginning of the cycle than at the end.
If food manufacturers could play a role in starting the next trend, they would be very well rewarded. This is a real slippery slope though that requires vision and R & D, things that far too many companies are lacking today. It also involves taking risks that make managers and investors uncomfortable.
How are Frito-Lay’s Olestra products doing? Not so good, right? And have you heard about the ‘side effects’ of the make-you-feel-full foods referenced in George’s introductory comments?
As others have commented more eloquently, successful food fads seem to bubble up from the population (and smaller companies) rather than being handed down from above by major manufacturers. (Consider, for instance, the origins of the huge categories of diet drinks and sports drinks.) It would seem to be different, considering the role that major pharmacological manufacturers play in medical developments. But food trends are literally visceral in origin.
It was interesting to watch the companies trying to get in on the Atkins bandwagon a while back. Several of them introduced products that were very obviously trying to suit a whole range of needs. They appeared to be Atkins friendly but could easily be removed and repackaged for reintroduction later without much loss of either reputation or sales. Those that were too obviously dedicated to Atkins were the losers.