ConAgra identifies strategic growth areas

by Eric Schroeder
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BOCA RATON, FLA. — Convenient meals, potatoes and snacks headline the top three strategic priorities for ConAgra Foods Inc. as it heads into fiscal 2009 and beyond, said company executives presenting at the Feb. 17 Consumer Analyst Group of New York Conference in Boca Raton.

Gary Rodkin, chief executive officer, said convenient meals, both frozen and shelf stable, are the top priority platform. With a determination to transform the business through more aggressive and creative innovation, marketing and selling on the company’s three power brands — Healthy Choice, Marie Callender’s and Banquet — ConAgra has made great strides in short time.

Looking at what he called an "underleveraged" brand, Mr. Rodkin said ConAgra is trying to reposition Healthy Choice toward a younger, more female target as opposed to the older, more male-oriented target of the past 20 years. In doing so, the company has transitioned the brand to more contemporary lighter entrees as well as new packaging featuring brighter, bolder graphics with positive nutrition messaging. The company also addressed the product side of the brand.

"Our core line of complete dinners were all renovated to include the quality and the nutritional content," Mr. Rodkin said. "We did the same with our entrees, significantly contemporizing their profile. On our very successful Steamers line, we made some product enhancements to our lowest quartile s.k.u.s (stock-keeping units), and finally, we developed a line of all-natural meatless entrees. This meatless line is probably our most forward leaning movement. We know a younger and more progressive target is looking for less processed, more real food — no additives, no preservatives, proactive nutrition like whole grains and antioxidants, not just weight loss. And they’re looking for more contemporary offerings.

"And finally, while most of our target is not vegetarian, many people in this target are looking to reduce their consumption of meat. Thus, we’re introducing varieties like Sweet Asian Pot Stickers and Pumpkin Squash Ravioli."

In regards to its snacks strategy, Andre Hawaux, president of consumer foods, said that while ConAgra’s primary focus in snacks is on popcorn, seeds and meat sticks, the company also has its eye on growing its grain bar and fruit snack business.

"These brands are leaders in their categories, categories that are growing, and we continue to gain share," Mr. Hawaux said. "We believe that snacking is a core and growing part of today’s lifestyle and our snacks provide a platform to expand healthy, better-for-you offerings."

Looking specifically at popcorn, Mr. Hawaux identified Orville Redenbacher as "a power brand" with room for tremendous growth.

"We believe in this economy as people stay home more and movie night becomes a family magnet that brings people together that Orville Redenbacher is well positioned for a strong growth rate, both top and bottom line," he said. "When you think of how healthy popcorn is and that for 75c a bowl you can serve your family, it’s a pretty compelling proposition in this economic environment."

Mr. Hawaux also said ConAgra has some breakthrough snack innovations set to roll out, including under the Alexia brand. ConAgra acquired Alexia Foods, Inc., which makes biscuits, potatoes, bread products and onion rings, in mid-2007.

"We believe the Alexia brand has some very broad shoulders and we believe the brand will play very well in snacks," he said. "The brand stands for premium, great taste, and has an all-natural appeal. It’s made from real vegetables. It has exceptional taste and texture, and it’s healthier than regular chips. As a matter of fact, it’s 25% less fat than regular chips."

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