World Grain - May 2010 - 50

FEATURE: RIDING HIGH AGAIN

tween formats such as the value channel,
club, traditional and mass merchandisers,
creating an identity has become a greater
challenge for retailers, Kelly said.
"It has become recognized on Wall
Street that the healthiest, most successful retailers also have the highest store
brand penetration," he said.
While trends for the company's branded business were negative, Kelly said the
decision to withdraw from several markets was not easily made. After all, even
in decline, the branded business generally was the most profitable for AIPC.
"That was the challenge," he said.
"That was the risk in our strategy. We
knew what the retailers were saying
about rationalizing brands, but would
they actually do it? But we wanted to
focus on growth, and we were expending resources (dollars and human) on
brands that did not have a realistic hope
of recovery. Still, the withdrawal strategy took a certain amount of courage of
conviction. But to be stuck was no place
to be either. Trench warfare with no advance is no way to win a war."
NEW HEALTH AND
WELLNESS APPROACH
Together with changing its approach toward brands, Kelly said AIPC takes a more
realistic view toward achieving growth in
the health and wellness category.
For many years, AIPC had used its
Heartland brand as the principal vehicle for serving as a carrier of health
and wellness benefits. As a result, new
products with these benefits were not incorporated into its other brands.
"With the strategic review of our
brands, we realized that creating a national health and wellness brand was not
a likely scenario for AIPC," Kelly said.
"Instead, we began putting health s.k.u.s
in our other brands and private label. We
had been depriving our brands of products with the greatest potential to give
growth to the company."
Despite the declines of several of the
company's brands, significant pockets
of strengths have been identified and
will be nurtured.

"Market by market, we are looking for
brands to strengthen," Kelly said. "For
instance, for all of Barilla's success elsewhere, Mueller's is still the top brand in
the Southeast. It's still large in Michigan.
But we are withdrawing from the Northeast. So we will continue to support it."
Kelly said in addition to Mueller's,
Golden Grain will be retained in certain

markets and that Anthony's may have
potential for expansion. He said the
brand sells very well in Southern California. Martha Gooch likely will be offered in a few markets in the middle of
the country but that Ravarino and Freschi (R&F) will be withdrawn from retail
and offered only at food service.
"This allows us to take our market-

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World Grain - May 2010

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