Schwan's Secret Recipe

“Consumers feel better about eating all-natural or organic,” says Anna Alderink, senior manager of consumer insights for Schwan’s Consumer Brands, who has been conducting consumer focus groups for more than four years, primarily on frozen pizza. “There is a large ‘health halo’ that goes with either.” But Alderink also notes that two-thirds of Americans are now overweight or obese. She is trying to determine why consumers say they want healthy food offerings, but often don’t actually pull them off the supermarket shelves and put them in their carts.

Alderink thinks she has solved at least part of the mystery. “If it doesn’t taste good, they won’t buy it,” she says. “Pizza is somewhat of an indulgence food. Consumers want [food companies] to find ways to make it more healthy. But at the same time, they are saying, ‘Don’t mess with my pizza. When I want to indulge, I want it to taste good.’”

In November 2006, Schwan’s launched its first product in the all-natural/organic category: Wolfgang Puck All Natural pizza. (It took over the licensing of the Puck brand from Omaha-based ConAgra Foods.) Schwan’s was careful not to bring out an all-natural version of one of its existing brands. Here, it was avoiding a pitfall its top competitor had fallen into.

“Kraft tried to take DiGiorno into the organic space directly,” Jansen says. “They actually launched about the same time we launched our Wolfgang Puck brand, but they’ve already pulled out. It was such a disconnect with consumers that they were never able to gain the kind of traction they needed to be successful.” The lesson seems to be this: Consumers don’t generally buy organic or all-natural versions of mainstream brands. (Would you buy an organic version of boxed mac and cheese, especially if it were more expensive than the regular kind? Would you care?)

So in developing Wolfgang Puck All Natural pizza, Jansen and Flack decided to emphasize flavor over health concerns. “There was a lot of positioning by brands that was almost sociopolitical in nature,” Jansen says. “Not that there is anything wrong with that, but taste and flavor sort of came second. It was all about being organic or all natural. We thought there was a real space for someone to say, ‘Hey, this is food.’ What if we talk first about this being the very best culinary experience you can have in food. And then, oh, by the way, part of developing that culinary experience is that we use only the best all-natural ingredients. It’s an approach that we believe is scalable beyond pizza to other frozen food categories.”

In the Fast Lane

Last year, Schwan’s also launched low-calorie, single-serving pizzas through its Red Baron Singles line called Thin & Crispy. These single-serving pizzas are all less than 300 calories each—“the magic number in entrées” for calorie-conscious consumers, Jansen says.

Schwan’s is also launching a similar type of offering through its Mrs. Smith’s frozen dessert brand. “People shop frozen pies 1.7 times a year, primarily around the holiday season,” Flack says. To drive more frequent purchases by overcoming calorie concerns, Schwan’s introduced this spring its Heavenly 100 line of single-serving, 100-calorie des-serts. The line is designed to increase the frequency of frozen dessert purchases, thereby decreasing seasonality.

Another opportunity in providing convenience involves the growing Hispanic population in the United States. In 2004, that population was nearing 41 million, according to the U.S. Census Bureau—bigger than the entire population of Canada. “We expect over the next 10 years or so that the Hispanic population will approach 50 million in the United States,” Flack says. “We need to find a way to better connect with that consumer base.”