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Kraft announces upcoming launch of Bagel-Fuls frozen breakfast

BY Diana Alickaj

NEW YORK Kraft Foods has revealed plans to launch its new breakfast product, Bagel-Fuls, to help boost sales in its cheese business.

Kraft, which also sells Maxwell House coffee and Oscar Mayer meats, has decided to focus on rebuilding new products for the cheese department, according to the Wall Street Journal. Recently, Kraft has been battling price increases, and cheaper private label products in the cheese industry, and is turning to their new product for a boost.

Bagel-Fuls was displayed at the Consumer Analyst Group of New York Conference on Tuesday, and are expect to be launched nationally in April. Bagel-Fuls are frozen bagels containing Philadelphia cream cheese already spread along the bagel.

Kraft is slowly regaining a presence in the cheese market, with such products as LiveActive cottage chesses, and according to the Journal, Kraft expects that the frozen bagel line will help enter the frozen breakfast market. Another aim is to involve the company in a new trend of producing quick meals designed for the busy consumer.

According to Chitra Ebeneze, the director of marketing for Bagel-Ful, “Consumers are not spending a lot of time cooking these days. Breakfast is one meal occasion they really struggle with.”

Even though hopes are high for the new product, Credit Suisse analyst Robert Moskow has his doubts. “Some believe that Kraft will enjoy a snap-back in cheese profits this year as costs in the dairy complex trend down,” he said. “The problem is that private label tends to adjust retail price points faster than Kraft. As a result, we think Kraft runs the risk of losing further market share to private label in a declining dairy cost environment.”

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Snack packs fall below 100 calories

BY Jim Wright

NEW YORK There’s a new magic number in portion-control land: 90.Also 80. And 70. Or even 60.

Packaged-food giants have discovered that calorie-conscious snackers who turned 100-calorie packs into a $200 million annual gold mine are getting bored with 100. So the bar is falling.

Quaker is making 90 the new 100, as it rolls out a string of 90-calorie treats.

The products are Quaker’s fastest-growing line, says Quaker Foods president Mark Schiller. “What I like most about 90 is that it one-ups 100.”

In 2007, 82 single-serve products touting fewer than 100 calories hit the market vs. seven in 2003, says Tom Vierhile, director of Datamonitor’s Productscan Online. “You sound like you’re a consumer advocate by ratcheting down the number of calories, but all you’re doing is helping your bottom line.”

Quaker, for example has introduced 11 single-serve products at 90 calories since 2007. Last month, it rolled out three Mini Delights and two granola bars.

Kelloggs “bull’s-eye” for snack packs is still 100 calories, but consumers will see “continued growth of portion-control packs” of all sizes, says Michael Allen, senior vice president of snacks.

With new Special K Bliss bars at 90 calories and Grab ‘n Go cereal packs as low as 70, Kellogg sells 150 portioned snacks.

New from ConAgra are Hunt’s Snack Pack Fat Free Pudding at 80 calories and David Seeds Pumpkin Seeds at 90.

Kraft just rolled out LiveActive Natural Mozzarella Cheese Snacks in 80-calorie sticks. Its Jet-Puffed marshmallows are sold in 90-calorie pouches.

General Mills is introducing Fiber One yogurt from Yoplait, with 80 calories.

Hershey’s low-cal offer: 60-calorie Hershey Sticks come in four flavors.

From Del Monte Pet Products, there are Pup-Peroni 50-calorie packs.

They’re a “guilt-free” snack, says Matthew Park, Del Monte’s marketing vice president. Just as 100-calorie packs help people, he says, 50-calorie packs help dogs cut calories and live “healthier.”

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Nestle expected to release record sales results

BY Jim Wright

ZURICH , Switzerland Despite rising costs for such ingredients as flour and milk, Nestle is expected to break sales records when it releases results on Thursday. Markets will be seeking assurances that a push by the world’s largest food group, into healthy foods and strong name brands will pay off, as global economic growth cools, but food inflation stays hot.

“Nestle has a well-balanced portfolio where its brand diversity means that there is no major reliance on a few key categories and slower-performing brands are offset by strong performers,” Bear Stearns analysts said in a note. “We expect Nestle’s high brand density to continue to increase going forward due to the strength and growth profile of its big brands.”

Nestle, which makes Nescafe coffee and KitKat chocolate bars, has managed to increase profits and profitability despite record prices for key food inputs such milk and cocoa.

Nestle’s strong brands, which include Buitoni pasta, Maggi soups and Friskies cat food, are expected to command loyalty from consumers in rich countries. But rising prices for food in developing markets may be approaching the point where some consumers retreat, experts say.

Investors will also look for any indications Nestle aims to sell its 75 percent stake in U.S. contact lens company Alcon or its 29 percent stake in French cosmetics group L’Oreal. The Alcon stake has a market value of about $34 billion, and the L’Oreal stake about $22 billion.

Nestle is seen posting an 11 percent increase in net profit to 10.22 billion Swiss francs ($9.33 billion), according to the average of a Reuters poll of 14 analysts. It is also expected to break the 100-billion-franc barrier for the first time with annual sales of 107 billion, the poll showed.

Nestle chief executive officer Peter Brabeck has said the group will reach its organic sales growth target of 5 to 6 percent in 2008.

Brabeck, who will pass the chief executive officer baton to Paul Bulcke later this year and remain as chairman, has said the group has the wherewithal to weather an economic slowdown in the United States, where Nestle generates around 30 percent of its profit.

Analysts see food groups’ pricing power—their ability to raise prices without killing demand—as perhaps the single best indicator of how they will fare in an environment of unprecedented food inflation.

In general, the weaker the brand name and customer loyalty to that brand, the more difficult it is to raise prices.

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