Hostess promises great taste plus nutrition with new cereal bar line - Interstate Bakeries' Hostess brand

Brandweek, March 9, 1998 by Stephanie Thompson

Banking on the brand's promise of rich taste to consumers, Interstate Bakeries' Hostess brand is introducing its own five-SKU line of better-for-you Fruit and Grain Cereal Bars to extend its equity in grab-and-go beyond snack cakes and donuts.

The new product is intended to reach out to the cereal bar segment's higher-income female target with a tastier version of the low-fat, vitamin-fortified breakfast alternatives, at a time that consumers are showing a decisive swing back toward taste and indulgence in their food choices, even at the cost of ingesting more fat (Brandweek, March 2). The Hostess intro comes right on the heels of Quaker's introduction of Fruit & Oatmeal Cereal Bars (Brandweek, Jan. 12).

While IBC's eight-SKU line of low-fat Hostess products, such as Twinkies and Crumb Cakes, have done only moderately well and two varieties of its low-fat muffins have been taken off the shelf recently in some markets, Hostess has made its name with consumers on the indulgence front, an aspect of food marketing that has become increasingly enticing lately to even the most health-conscious of consumers. Although the new Hostess Fruit & Oatmeal Cereal Bars meet the same nutritional standards of competitive better-for-you cereal bars, including Kellogg's Nutri-Grain and Nabisco's SnackWell's, Hostess hopes to edge out the competition by positioning the new line as superior-tasting and made with 10% more fruit filling.

To support the March 23 intro of the Cereal Bars, which come in eight-count multi-pack boxes of apple, banana nut, blueberry, raspberry and strawberry flavors, sources within the company and at retail said that TV, radio and FSI support will begin in late April. But IBC marketing vp Stan Osman denied any plans for media support, saying efforts will focus mainly on displays driven by the company's DSD operation as well as in-store demos that include free trial of the line. IBC spent $6.9 million on media during the first 11 months of 1997, according to Competitive Media Reporting. Hostess' agency of record is Campbell Mithun Esty, Minneapolis.

"Categories like this are mostly about taste and, because we provide DSD, we can offer a fresher product with a shelf life of six weeks, while others have a shelf life of six months," Osman said. Internal research at IBC found that the product beat the competition in taste tests 9 to 1, and retail buyers agreed that the product is "much softer, with more fruit, and it tastes better," as one put it.

Hostess had supermarket sales of $203.2 million in the $622.7 million snack cake category for the year ended Nov. 16, according to Information Resources. With the new entry it is looking to steal share from Nutri-Grain Bars, which had sales of $143.5 million in 1997, according to IRI, as well as Nabisco's declining $75.1 million SnackWell's brand and new entries in the segment from Quaker and Entenmann's.