News: Kraft Drops Diet in Favor of Living
Kraft Foods Inc. has rechristened its South Beach Diet line of foods to South Beach Living.
It is a one-word name change, but "diet" always has had powerful and not necessarily positive connotations among consumers, bringing to mind older folks struggling, and often failing, to lose weight.
"Living" on the other hand suggests vibrant youth pursuing a healthy, natural lifestyle.
Or at least that is what marketing experts say.
"There's always been this discussion: Is dieting a bad word?" said Harry Balzer, a food industry analyst at NPD Group. Often, food and beverage companies decide the answer is yes, concluding that the word "diet" can restrict their efforts to market a product.
Coca-Cola Co., for instance, developed its Coke Zero, a no-calorie version of its flagship product, partly because young male consumers responded poorly to beverages labeled "diet."
After all, no one has ever successfully marketed a "diet" beer. The makers of everything from mayonnaise to hot dogs long ago settled on "light" as a healthy, positive-sounding euphemism.
For Kraft, "diet" seemed to limit South Beach to those who wanted to lose weight, not the wider and growing category of consumers who want to eat healthy.
"We think [the name change] is going to broaden the appeal of the brand and fuel its growth trajectory," said Howard Brandeisky, Kraft's vice president for strategic marketing initiatives.
Northfield,IL-based Kraft certainly could use some fast-growing new products. The nation's largest packaged foods company is well known for its many famous brands, including Oscar Mayer, Oreos and Jell-O. However, sales expansion is slow in many of its traditional lines, and analysts say Kraft needs more innovative new products like the South Beach line.
Kraft rolled it out in 2005 after signing a trademark agreement with Dr. Arthur Agatston, the Florida cardiologist who created the South Beach diet, which stresses low-carbohydrate foods. Originally, Kraft's South Beach line included 50 products, but that has since grown to 70, from frozen entrees to snack bars and salad dressings.
Analysts say Kraft's South Beach line came to market late: Agatston's book was particularly popular in 2003, and diets are notorious for being faddish. South Beach's revenue of about $250 million during its first 12 months is a drop in the bucket for Kraft, which has about $35 billion in annual sales.
Still, analysts and Kraft say the South Beach line has been a winner. Information Resources Inc., a market research firm, this year named South Beach one of its "Product Pacesetters" for 2006. South Beach was the top-selling new brand for food and beverages, IRI concluded.
"They have been pretty successful, and [South Beach] has probably been one of the better new product ideas Kraft has had in the past few years," said Tim Ramey, a stock analyst at D.A. Davidson & Co.
Changing the name from "diet" to "living" makes sense, he added, because "there are negative connotations to 'diet.'"
Lots of them, apparently.
First, the word "diet" can suggest an older demographic, not the coveted young adult market.
"The older you get, the more likely you will be on a diet," said Balzer.
Plus, the diet market is not growing: While the exact number of Americans who say they are on a diet ebbs and flows, it basically has been stuck at around 25% of the population for more than 20 years, Balzer said.
Another potential hurdle for a product dubbed "diet": an implication that somehow it will have inferior flavor.
"You put 'diet' on a product, and you immediately think it's not going to taste good," said Laura Ries, a branding consultant and author of "The Origin of Brands."
Not to pile on, but "diet" even can connote failure, as in the inability to actually lose weight.
"The minute you say 'diet,' you think, 'I'm going to fail,'" said John Palumbo, founder of BigHeads Network, a marketing consulting firm.
By swapping out "diet" for "living," Kraft is striving to make South Beach more of a lifestyle brand, a Holy Grail sort of goal for marketers, Palumbo said.
"No matter what boardroom you're in, every brand mantra is, 'How do we become a lifestyle brand?'" he said.
A lifestyle brand can turn a product into, well, more than just a product. Apple and its iPod are classic examples, Palumbo said. The company and the music player exude a certain fashionable, tech-steeped way of life, at least to avid Apple customers.
For a brand like South Beach, the goal is to position the product as part of a healthy, natural lifestyle, and the word "living" helps accomplish that better than "diet," Palumbo said.
Ries said Kraft has a potential problem, though: Despite the name change, many consumers likely still will associate South Beach with dieting.
For instance, with Coke Zero, Coca-Cola did not simply rename Diet Coke, but instead tweaked its famous beverage to create a new product, she said. Kraft is tweaking a name, but the most important part of that name, "South Beach," does not have the buzz it did a couple of years ago, Ries said.
From the January 7, 2008, Prepared Foods e-Flash