DuPont pushes soy as the next teflon
With TV ads, company hopes to raise its name recognition, ignite sales
By FRED BIDDLE, Staff reporter, 03/03/2004
http://www.delawareonline.com/newsj...tpushessoy.html
The DuPont Co.'s latest commercials tout foods containing its brand of soy protein. But the ads also are part of DuPont's efforts to convince Wall Street it still has a knack for turning commodity products into premium brands, at a time when it sees few other opportunities to raise prices.
"Which contains protein?" asks one of four 15-second TV spots from the Solae Co., a DuPont joint venture. The commercial's fictional game-show contestant picks a rack of lamb, not V8 Splash Smoothies made with Solae soy protein. "Both" is the right answer, the commercial says.
"Protein in Unexpected Places" is the name of the new ad campaign, which debuted this week and will air on cable TV networks. DuPont has struggled in recent years with building on its famous name, even as rival BASF Corp. has gained recognition with commercials that end: "We don't make a lot of the products you buy. We make a lot of the products you buy better."
"We're doing with the Solae brand exactly what we've done with Teflon, Tyvek, products like that, where we have created an ingredient brand," Chief Executive Charles O. Holliday Jr. told analysts in New York City last week. That's "something that has not been done in the food industry," he said. Although ingredients such as the artificial sweetener Nutrasweet have become big brands, no company has successfully branded such a basic nutrient as protein, a Solae executive said.
Until now, DuPont's commercials have had little to do with the success of some of its biggest products. Tyvek, a multipurpose insulating wrap, is better known because its name is printed in big blue letters on wrap visible from the road as houses and other buildings are erected.
But last year, the company consolidated all of its marketing and communications for the first time, naming New York-based Ogilvy & Mather Worldwide as its lead agency. Now, Ogilvy's commercials for Solae directly spotlight what may be DuPont's biggest recent success.
Solae's annual sales already have surpassed $1 billion. That's 25 percent higher than DuPont projected in January 2003, when the subsidiary was transformed into a 72 percent-owned joint venture with White Plains, N.Y.-based oil-seed producer Bunge Ltd. Overall, DuPont's net sales grew 13 percent in 2003, to $27 billion.
Although the new commercials coincide with the high-protein, low-carb Atkins diet craze and recent meat safety scares, "they're essentially tailwinds for us," Todd Sutton, Solae's global marketing director, said Tuesday.
He said Solae's presence in 40 products, ranging from Snapple-a-Day beverages to Gardenbuger meatless foods, represents a critical mass that favors advertising the brand in frequent short commercials with one message: Solae soy equals protein.
"We think that when consumers find out that they don't have to eat a slab of pork or a chunk of lamb to get protein, it will be memorable," Sutton said in a statement Sunday, as the first of the Solae commercials debuted on Joan Rivers' pre-Oscar program on cable television.
DuPont wants soy to be as successful as Teflon, which was in countless products before cookware made it nearly synonymous with pots and pans. Soy protein now accounts for less than 1 percent of all protein consumed worldwide. Only 3 percent of soybeans are used in food protein applications, according to a recent report by New York's Buckingham Research Group. Most soybeans are used in animal feed, cooking oils or industrial products such as paint.
DuPont has long cited new products, not new brands, as the way to growth. But linking Solae to soy in the public's mind could help DuPont command a bigger premium from food companies using it, as the company did with cookware makers who used Teflon instead of other nonstick coatings.
Such opportunities don't come along too often. DuPont executives recently told analysts they don't expect the recovery to enable them to widely raise prices on the company's roughly 79,000 products. And last week, Holliday ruled out increasing sales by acquiring big companies, another way DuPont has boosted sales in the past.
What's more, BASF isn't the only chemical company to have successfully courted the public with commercials. One of the biggest, the 3M Co., all but redefined itself with its heavily advertised Post-It Notes.
"Solae is important in improving the name recognition of DuPont, and targeting the consumer directly may move the company closer to 3M in the minds of investors," said Frank Mitsch, who follows both companies for Fulcrum Global Partners in New York. "However, this will not happen overnight."
Reach Fred Biddle at 324-2878 or fbiddle~delawareonline.com.
BRANDS WITH SOLAE
• 8th Continent soy milk
• V8 Splash Smoothies
• Gardenburger meatless foods
• Snapple-a-Day meal replacement beverages
• Harmony cereal
• GeniSoy bars and beverages
• Mori-Nu tofu
• Yves Veggie Cuisine deli slices and hot dogs
• Nu-Go Nutrition-to-Go bars
• Naturade Total Soy beverages