Promo - February 2008 - (Page 11)

The Players forecast for the second time. Overall, sales fell more than 20 percent in 2003. “Atkins had a huge impact,” says Kat Fay, editor and senior analyst for Mintel International, a market research firm. “Slim-Fast tried to keep up with that.” The company fought back with a new line of pastas, soups, and frozen novelties and low-carbohydrate offerings in 2003. A year later, Slim-Fast rolled out a line of high-protein items and reformulated its product line to include 50% less sugar. It also relaunched as Slim-Fast Optima. But it wasn’t enough to reinvigorate sales, which dropped by more than $300 million in 2005 amid tough competition, according to Information Resources, Inc. Unilever reported a gain in shares in the Americas, but said sales were “well below” 2004. “It was hard at that point in time for us to succeed,” Blake West admits. “People had so many choices. We weren’t clearly differentiated.” How else will Slim-Fast drive sales? Most likely through new products. For now, Slim-Fast is keeping mum on what new items may hit the market. “We will do it selectively and only when we can bring a point of difference” to the industry, Blake West says. She admits it won’t be easy for the brand to get back to its 2002 levels. And it’s now facing competition from a market newcomer, Alli, an over-the-counter, weight-loss pill. At least one analyst is optimistic. “The Slim-Fast brand has been around for years,” Fay says. “It’s one of those brands that people trust. We don’t see SlimFast going away.” l P STATE OF DECLINE Slim-Fast’s U.S. sales have steadily dropped since 2002. But executives are hoping for a turnaround. Here’s a look at the numbers and some factors that might have played a role, good or bad, for the company. CELEBRITY ENDORSERS The Slim-Fast product portfolio now features more than 50 items consisting mostly of shakes (liquid and powder) and “meal” bars. And its distribution is growing. Slim-Fast began selling its products last month in value stores, such as Dollar General, to expand its reach, Barker notes. The products, however, aren’t just for women. “People’s perception of the brand can be a bit feminine,” she admits. “But historically, men and women have used it.” Rumors circulated last month that Slim-Fast approached rapper Eminem as a potential spokesperson. But Blake West says no offer was made. Instead the company gave the artist free product, which was requested. To appeal to men, the 31-year-old brand in its early days ran TV spots with endorsers like Tommy Lasorda, Peter DeLuise and Mel Torme, among female personalities like Kathie Lee Gifford. But until mid-2007 it went a few years without a known face. Three years ago consumers threatened to boycott SlimFast in response to then-spokesperson Whoopi Goldberg publicly mocking President Bush’s surname as a sexual reference. She was promptly dropped from the ad campaign. Hunter’s current alliance with Slim-Fast sparked some backlash, particularly in online forums. People questioned why the brand used a slim celebrity, a model no less, to pitch its products. “I also wonder how consumers could be so willfully dumb as to buy the idea that if Hunter decides to use Slim Fast, that it means anything at all about their own chances for success,” one poster wrote on Diet Blog. “She’s already super-skinny. At least take a FAT washed up actress or model, and then put them on Slim-Fast. If they get super-skinny, it still doesn’t mean much (given their trainers & chefs and financial incentives, etc.), but it might mean something!” Blake West says Slim-Fast approached Hunter because she embodied the Find Your Slim point of view and was a brand supporter. 2002: $543.9 MILLION • Atkins Diet craze begins. 2003: $441.1 MILLION • Celebrities like Brad Pitt and Jennifer Aniston jump on the bandwagon and endorse the Atkins Diet. 2004: $309 MILLION • Marc Covent steps down as Slim-Fast’s president. SlimFast continues to lose market share. Atkins Diet peaks. 2005: $243.1 MILLION • Unilever’s European division takes write-down on SlimFast after sales slump. Unilever USA launches Slim-Fast muffin bars to spark sales. 2006: $241.8 MILLION • Slim-Fast shows improvement as market shares in the Americas rise, but fails to surpass 2005 revenue. 2007: $222.9 MILLION • Sales dip further, despite Slim-Fast’s new marketing, Find Your Slim. The firm launches new Easy to Digest products to boost its competitive edge.—Amy Johannes SALES FIGURES SOURCE: INFORMATION RESOURCES, INC. DATA INCLUDES U.S. SUPERMARKETS, DRUGSTORES AND MASS MARKET RETAILERS, BUT EXCLUDES WAL-MART, CLUB STORES, HBC SPECIALTY STORES AND CONVENIENCE STORES. Today, Slim-Fast’s packaging markets its flagship Optima line (right), which relaunched in 2004. The name replaced the Ultra Slim-Fast moniker seen on products in 1998 (left).

Table of Contents Feed for the Digital Edition of Promo - February 2008

Promo - February 2008 Contents Editor's Note Reality TV Products Rebound - Soon? The Real World Young But Not Stupid Social Tease Health Quencher How Effective? Big Game in Big Easy Commentary Mailbox Marketing Q&A: Coke's Kruse Control Gift-Card Monte Room Service The Agency Center Resource Center Can't Beat Loyalty Index of Advertisers

Promo - February 2008

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