Food Product Makers Are Hot for Microwave
Move over, “New!” Take a break, “Improved. “ Perhaps the most popular catch word being slapped on many food packages these days is “microwaveable.”
Microwave ovens began showing up in American households in the late 1960s, and the first food products aimed directly at the time-saving appliance popped up a decade later. But with 60% to 70% of American households now having a microwave, food companies are unleashing a horde of microwave-only products.
Last year, 284 new microwave food products--up from 172 introductions in 1986--found their way to the supermarket, according to Marketing Intelligence Service Ltd., which tracks new products. By altering ingredients and packaging, food companies now offer convenience-hungry consumers everything from a microwaveable a hot fudge sundae to an eight-minute roast.
And microwave products are no longer limited to the frozen food section of the supermarket. Pillsbury sells microwave cake and brownie mixes. Geo. A. Hormel & Co. has tested a line of precooked, vacuum-packed meat entrees that do not need refrigeration. Procter & Gamble even offers a microwave version of its Bounty paper towels.
About $760 million worth of microwave food products were purchased during the 12 months ending Oct. 9, according to Sami/Burke Inc., which compiles statistics on consumer buying. Sales during the previous 12 months totaled $520 million.
“If you are not in that category in a major way, you are certainly going to have problems,” said Larry Haig, a spokesman for Pillsbury, which expects to sell about $300 million worth of microwave products this year. That’s up from $176 million the year before.
The reason behind the push into microwave foods has been the rapid sales growth of microwave ovens themselves. In 1980, only 20% of U.S. households had a microwave, according to industry estimates. That figure should reach at least 70% by 1990.
In fact, microwaves are found in more homes than dishwashers, according to Appliance magazine.
Unlike many appliances that end up stored away in the cupboard or pantry, microwave ovens often end up as kitchen workhorses. “People are not afraid of their microwaves,” said Sally Robling, who manages a line of microwave snack foods--Zappetites--for Oscar Meyer. “They use them. They are not crock pots.”
Food companies have also found that when microwave owners go grocery shopping, they prefer to buy microwave foods and packages. As a result, “shelf space has been decreased for items that could not be put in the microwave,” said Kevin Paugh, who is in charge of allocating shelf space at the Vons supermarket chain.
Some companies have met the demand for microwave products by simply slapping a “microwaveable” label on their packages. But, as many consumers know, some products have fared poorly in the ovens. Bread often becomes tough and chewy in the microwave. Meat does not brown in the ovens. Some foods are heated unevenly.
To get around these problems, many food companies have gone back to the drawing boards. Pillsbury devotes 60% of its research and development budget to microwave foods. Campbell Soup Co. established the Microwave Institute, which is charged with making all of the company’s products ready for microwave use by 1990.
Some of the results might surprise consumers. Oscar Meyer’s Zappetites cheeseburger has a hole in the middle of the meat patty. The doughnut shape of the patty distributes microwave energy more evenly than circular or square shapes, industry experts say.
Much attention has also been focused on packaging. Pillsbury, for instance, incorporates a special packaging material that directs more microwave energy toward pastry and bread crust. The result is the flaky, browned bread surfaces consumers prefer.
The new microwave products usually cost more than their oven-heated counterparts. For that reason, food companies stress quality. “They pay a few more pennies and they expect the quality,” said Haig of Pillsbury.
More microwave foods products are on their way, food makers promise. “Consumers are ready for a product like this,” said Robling of Oscar Meyer. “You cannot ignore it,” she said of the microwave oven. “It’s simply everywhere.”
Executives’ Theme: On the Road Again
The Los Angeles offices of some major advertising agencies have seen plenty of executive shuffling recently:
- David Park of Milici Valenti Park & Gabriel Advertising of Honolulu is now president of the Los Angeles office of DDB Needham West.
- Patrick King of George Patterson PTY, one of Australia’s largest agencies, has become West Coast chairman for AC&R;/DHB&Bess; Advertising.
- And the Los Angeles office of BBDO/West awaits a new president to replace Don Mitchum, who left for the firm’s Atlanta office.
What’s going on?
Lee Clow, president of Chiat/Day, believes it is all relat ed to the wave of agency buyouts and restructuring. “There is a lot of agency merging and purging, where all kinds of people are moving into new positions.” But, he adds. “I really don’t know what to make of it.”
Jim Spero, president of the Advertising Club of Los Angeles, however, thinks that the executive changes are “more coincidence than anything else.”
Alpha Beta Decides to Go With the Green
Alpha Beta supermarkets are going for the green. The supermarket chain has adopted bright, “produce green” signs and logos as part of a companywide effort to refurbish stores. Why green? Well, Alpha Beta saw it as a way to set itself apart from competitors, said Jeffrey J. Ivarson, a member of Sidjakov, Berman Gome & Partner, a San Francisco marketing and design firm.
“Most grocery retailers use primary colors (blue, yellow and red),” Ivarson said. In Southern California, 22 of the 192 stores in the area already bear the new signs.
Mutual Funds Apply Brakes to Advertising
More fallout from last October’s stock market crash: Mutual funds have sharply cut back on advertising. The crash put the brakes on an impressive increase in mutual fund advertising during 1987, according to Advertising Information Services, which tracks ad spending. The firm says mutual fund print advertising increased 54% through October from the same period in 1986.
But spending during November grew by only 14%.
Despite the advertising slow down, many large mutual funds--such as Fidelity Group and Vanguard Group--still managed to spend more in November and December than they did during the same period in 1986. Scudder Group, however, cut back advertising 71%, according to AFI.
The firm also notes that before the crash, mutual fund ads focused on equities and growth. Post-crash ads tout safety, rates of return and service.
Chiat/Day Sets Out to Meet the Neighbors
Los Angeles advertising agency Chiat/Day has begun its long awaited move to Venice and it has wasted no time in getting acquainted with the neighbors. The agency launched a tongue-in-cheek ad campaign featuring the line, “There goes the neighborhood.”
The ad was placed on two billboards not far from its new offices on Hampton Drive, near the beach in Venice. A companion radio ad touted the move as part of the agency staff members’ search for a “place where their ideas can grow and flourish. And besides, their lease is up.”
“It’s aimed at the community,” said agency President Lee Clow, who has been a Venice resident for about a decade. “It does not really have a hard core business purpose.”
Chiat/Day is moving into a refurbished warehouse across the street from where its new headquarters is being built. Construction of the new structure should start soon after being delayed following the discovery of toxic wastes on the building site.
“It’s kind of like childbirth,” Clow said of the move. “It took longer than it should have, and it wasn’t altogether painless.”
