Births drop, but baby food sales up.
The National Center for Health Statistics offered two reasons for the drop in number of babies born, "Although the number of women in the childbearing ages (15-44) increased by 1% from 1982 to 1983, the number of women at the younger ages (15-24) actually declined. Births to women under 25 years typically account for nearly half of all births." The second contributory factor is the decline in the fertility rate.
But each baby is apparently consuming more commercially prepared product than a year earlier, helping manufacturers to a 4% increase in sales. William Bogdan of Beech-Nut says mothers now realize that commercial baby food is wholesome and nutritious and that it no longer posesses the added salt, sugar and preservatives it had in the past. "Commercial baby food is as good as grinding up food yourself, without all the work."
Beth Adams of Heinz agrees. "There are more working mothers and they are relying on commercial products. Also the lower inflation rate is prompting greater use of commercial products."
Indeed baby food prices have remained stable over the past two years and two of the leading manufacturers, Gerber and Beech-Nut, foresee prices staying stable this year. Heinz has adopted a "wait and see posture" for 1984.
Whatever happens with the pricing structure in the store, manufacturers have found promotions that strike a sensitive nerve with parents. These promotional strategies combine baby food buying with donations to charities that are specifically for young children. Heinz, for instance, has a campaign to raise money for children's hospitals. Gerber has a promotion to benefit the March of Dimes. Both give the consumer a direct part in the money raising effort and at the same time encourage them to buy a particular brand of baby food.
Heinz consumers are asked to save labels for which the company will then make donations to participating children's hospitals. The campaign began in 1979, and has been upgraded several times since then. Initially Heinz offered 2 cents to a Pittsburgh children's hospital for every Heinz Baby Food label sent in by consumers. In 1982, the donation was raised to 3 cents and, this year, more than 50 hospitals from Virginia to Texas are benefiting. Also in 1984, the H.J. Heinz Foundation matched the company's donation to make each label worth a 6-cent donation. In 1983 alone, more than $57,000 was donated and over the five years of the program more than 5 million labels have been collected. "We're in the baby business, and this program furthers our commitment to the well being of children," says Adams.
Some food stores have elected to become directly involved with the promotions. St. Louis-based Schnucks, for example, makes its contribution by displaying Heinz posters and putting promotional slicks on grocery bags. A total of about 750,000 bags will be produced. Giant Food of Landover, Md., is supplying shelf talkers to help bring the offer to the consumer's attention.
By contributing an additional 3 cents for every label, Indiana-based Lowell's Discount Foods, is making an even greater commitment. Robert A. Beck, vice president of marketing at Lowell's sees it as a good opportunity to get involved in a charitable cause. And as a result to this campaign, Heinz Baby Food is carried in all 48 Lowell's food stores, with Heinz now occupying twice as much shelf space as it did previously and getting a significant increase in sales.
In celebration of National Baby Week, Gerber had a promotion to benefit the March of Dimes. It combined a coupon offer with a label saving program. For every 12 Gerber food labels returned, Gerber donated 25 cents to the March of Dimes. Consumers also received a store coupon worth 75 cents, an added incentive for them to participate. The offer ran from April through June. In conjuction with it, Gerber sponsored a "Celebrity Walk." Television celebrities visited major U.S. cities to encourage participation in the March of Dimes WalkAmerica, a national event which was held in April.
Beech-Nut, while not involved in any particular charitable campaign, makes "outright donations of product or money" to various charitable organizations, a company executive says.
In addition to the three industry leaders, a relative newborn from Europe has joined the ranks of American baby food producers. Milupa Corporation, which began marketing its product in Canada in 1981, is available in eight test markets in the U.S. Distinctly different from traditional baby food, Milupa is having somewhat of a slow start.
The entire infant food line is dry, and unlike traditional baby cereal, which is mixed with formula, Milupa is mixed with warm water. The product already contains infant formula. "This means the breast-feeding mother has no need to bring formula into her home," says Frederick Rothhaar, president, whose company has nevertheless begun marketing its own formula. Milupa uses foil innerwrap and plastic shrink wrap on its boxes. Filling the gap Meanwhile, in an effort to keep older children as customers, Beech-Nut has come out in select markets with a new line of products called Table Time. Beach-Nut's Bogdan says, "We are looking to fill the gap in the transition from baby food to table food."
Beech-Nut has also brought out Fruit Supremes--fruit mixtures that can be served as desserts or side dishes. They're available in a variety of combinations, such as apples, mandarin oranges and bananas. Fruit products are a big seller in many forms. Heinz's popular Saver-sizes fruit juice is now available in mixed fruit, as well as the company's original flavors of apple, apple-cherry and apple-grape.
Formula, which accounts for a little over half of the entire baby food category, also seems to be benefiting from the burgeoning women's work force due to its convenience. Positioned as the next best thing to breast milk for the first four months of a child's life, manufacturers have not had to alter their marketing strategies as there is no need to.
Some technological changes may be one the way, though. One manufacturer is conducting research on ways to increase the shelf life of formula and to give babies added disease protection through formula additives.
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|Date:||Jul 1, 1984|
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