The How and Why of French Fry Profits
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Holmes Report

The How and Why of French Fry Profits

The J.R. Simplot Company, one of the top three potato processors in the world, asked Ketchum to help change the industry perception that typical foodservice “bargain fries” are a false savings and demonstrate why higher-priced premium fries are more profitable.

Paul Holmes

The J.R. Simplot Company, one of the top three potato processors in the world, asked Ketchum to help change the industry perception that typical foodservice “bargain fries” are a false savings and demonstrate why higher-priced premium fries are more profitable.

It is an accepted industry practice to buy cheap fries to reduce food costs and therefore, increase profits. But if the company could teach the market with research-based evidence and a quantifiable analysis of increased profit potential, we would motivate restaurants to trade up to Simplot’s value-added, premium fries—products that are vastly more profitable for the company than its lower-priced commodity fries. Working with Simplot, Ketchum agreed on an educational strategy to reverse the business dynamics of the fry category.

Ketchum’s main campaign objectives were to: convert 125 new restaurant customers from “bargain” fries to Simplot premium fries, increase awareness that premium fry products are more profitable than bargain fries and stimulate trial of Simplot’s premium fries (e.g., Ultra Clear, Recipe Select and Blue Ribbon products).

The PR team’s main strategies were to develop a compelling marketing program that communicates the profit message of using premium fries instead of “bargain” fries and enhance the current fry expertise of the Simplot sales force with tools and knowledge that will allow them to more effectively demonstrate the profit message.

Working with a team of marketing, sales, and research and development staff, Ketchum conducted a series of tests to quantify performance and profitability differences between “bargain” french fries and premium fries. The research resulted in several conclusions, which were incorporated into all sales and marketing materials/tools: that Simplot premium fries contained up to 14% to 27% more potato solids (less water) than bargain fries, meaning restaurants—and their customers—get more potatoes and less water per serving of product; that Simplot premium fries yield up to 15 more servings per case, meaning restaurant customers can serve more people with one case of premium fries than with bargain fries.

In addition, the firm quantified the increased profit potential for restaurant customers that purchase premium French fries. It did this by first interviewing 25 Simplot customers to determine average menu prices, servings per case and case costs for bargain fries and premium fries. Using this data, Ketchum determined that the average increased profit for a restaurant customer when switching to premium fries is $14.33 per case

The research provided credibility for the program’s primary message: Restaurants can easily make more money by simply switching to Simplot premium fries. Ketchum then developed an integrated marketing program that launched in November 2002 and concluded in August 2004.

Ketchum introduced the Fry Profitability program to the top trade editors at the International Foodservice Editorial Council conference in November 2002. To appeal to trade editors’ desires for supportable claims and data, Ketchum leveraged the research findings on the product benefits and profit-potential data of premium fries. We developed an aggressive pitch calendar for feature article placements and monthly product release schedule for the next 18 months. Releases were sent with product photos to generate further placements with national trade publications.

In January 2003, Ketchum distributed a comprehensive set of materials and incentives to support the ad campaign and sales efforts, including: program brochure to show the relationship between premium fry attributes and increasing profits (a result of the fry performance research); direct mail postcards to be used at the sales force’s discretion; and an educational video with customer testimonials for tradeshows and presentations. To encourage product trial, Ketchum created rebate coupons, redeemable when restaurants purchase Simplot premium fries. We also launched the “Guaranteed Success Program” for restaurants, ensuring that customers would make more money with Simplot premium fries or receive a full refund.

Ketchum developed an ad campaign as the core communications element that addressed the three primary barriers to using premium fries. With a straightforward design that minimized text, colors and images, the How? What? Why? campaign launched a comprehensive ad schedule in targeted trade publications in March 2003. Insert cards accompanied the ads, highlighting a free recipe brochure available to restaurants.

Ketchum introduced three additional executions in February 2004. We developed two testimonial ads, featuring new customers who switched to Simplot premium fries because of the program as well as a branded fry ad to reinforce that Simplot has the right premium fries to increase restaurant profits.

The PR team based its evaluation of the campaign on these results: the Fry Profitability ad and publicity campaigns generated 6,820,400 impressions, resulting in 671 responses via reader service cards and 25 placements in the top six foodservice publications, advertising readership scores were consistently above average. Qualitative verbatim comments from restaurants overwhelmingly had a common theme: “I can make more money with better fries,” successfully trained 1,117 sales representatives on the Fry Profitability program and SVP Sales percent Marketing: “This is the highest level of enthusiasm for a new program that I’ve seen from this sales force in my ten years at Simplot.”

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