Cashing in on comfort: Kraft adds oomph to new version of boxed mac 'n' cheese

Tough times call for some serious comfort food, and macaroni and cheese is a staple of that category. That’s added up to a nice payday for manufacturers. As a whole, macaroni and cheese sales are up 25 percent over the past four years, to $802 million.

Kraft Macaroni & Cheese Dinner accounts for the vast majority of category growth, which probably means more parents, willingly or not, have joined their kids in more bright-orange dinners. There are much smaller but also growing competitors, like Annie’s, which sells itself on taste as well as natural claims, and private label, which is sometimes half the Kraft price.

Now, Northfield, Ill.-based Kraft wants to bring mac and cheese, launched in the Great Depression, from kids’ plates to the center of the family dinner table.

The company had been toying with a homier version of macaroni and cheese for many years, but after watching cheesy, crusty restaurant versions proliferate in recent years, and more people cooking at home to save money, Kraft began work on what is now its Homestyle Macaroni & Cheese Dinner about 18 months ago.

The new mac and cheese comes in a bag and sells at $2.99. It comes with wider, curvier noodles, a packet of gooey orange cheese, breadcrumbs and a seasoning packet, with which cooks make a base for the cheese sauce.

Kraft is also tapping into a trend of putting personal touches on family dishes by offering an “optional oven finish,” involving more cheese and an even-crispier breadcrumb topping, thanks to five minutes in the oven.

Other foodmakers have been cashing in on consumers’ need for classic comfort foods. Campbell Soup has boasted about increased pasta sauce sales.

Ore Ida, owned by Heinz, has pointed to its Steam n’ Mash potatoes as one of its most promising launches in years. The spuds steam in a microwaveable bag, because no one likes chopping and peeling. Then cooks mash the potatoes and add butter, milk or some kind of personal touch. Ore Ida’s webite offers recipe suggestions, too.

“The consumer, because of the economy, isn’t eating out as much as they did in the past,” said Dennis Lombardi, executive vice president of food-service strategies at Columbus, Ohio-based WD Partners. He said the trend isn’t just about more comfort food but “creating something a little extra special that gives you a little bit of a small indulgence for that meal.”

It may be the difference between a regular frozen pizza and a pie from California Pizza Kitchen, now owned by Nestle. Lombard said. For humble macaroni and cheese, he said, an upgrade to creamier, cheesier sauce and bread crumbs is apt to fit the bill as well.

In a recent interview with the Tribune, Kraft Chief Executive Irene Rosenfeld said the company invested in Homestyle “to bring in the adult user.” The iconic mac in the blue box, she said, is a kid favorite.

“Now the opportunity is to expand the brand with product lines like Homestyle ... that really create a terrific, restaurant-quality meal,” she said.

Kraft Macaroni & Cheese Dinner sales are up 8 percent over last year, to $645 million, according to SymphonyIRI Group, a Chicago-based market-research firm. The data exclude Wal-Mart and club stores.

Kraft has increased marketing support behind the product this year, with a new tagline, “You know you love it.” Homestyle hit store shelves in June.

Kraft and its competitors understand that after years of casual-dining excess, consumers now forced to eat at home to save money aren’t interested in sacrificing tastes they’ve come to love.

General Mills has sought to create weekly taco nights with its Old El Paso brand and seen sales soar 8 percent over the past fiscal year, according to a company presentation.

The National Cattlemen’s Beef Association is rolling out a program called Slice N’ Save. The organization has created leaflets, stickers, in-store signage and YouTube videos to teach shoppers how to cut their own steaks, roasts and kebab chunks. Trevor Amen, marketing manager for the association, noted that people can save from $1 to $2 per pound by cutting their meat, which really adds up on a 5-pound slab.

The association’s goal is to avoid another bad year. Last year, beef sales at restaurants fell $3 billion. Wholesale beef sales average $24.5 billion each year, so the swing was painful.
Kraft’s Homestyle seeks to build on the core product’s success, with a swipe at the adult market.
“From a Kraft standpoint, it’s really very smart,” said Lynn Dornblaser, director of consumer-products insight at Mintel International. “It doesn’t have any overt kid positioning, so you don’t have to feel guilty about eating Kraft Macaroni & Cheese.”

Of course, they’re likely to get some family trials, anyway. Emily Paster, of River Forest, said her daughter, Zoe, is allergic to dairy, but macaroni & cheese is “one of the five foods” her son, Jamie, will eat. And so she makes a box of Annie’s Shells for him a few times a week.
But would she sub the regular macaroni for the Homestyle version?

“I’d certainly take a look at it,” Paster said. “It sounds kinda good.”

Dornblaser added that the product seizes on the cooking-at-home trend, but armed with the knowledge that “many consumers, especially the younger ones, don’t have very extensive cooking skills.” The idea, she said, is to “take something that’s like what they would get in a restaurant, or maybe from mom and dad, but is very easy and foolproof.”

In short, Kraft seems to be really taking aim at consumers such as Max Crumpley, a 23-year-old student who’s “not that big a fan” of boxed mac ‘n’ cheese.

“I’m going to make it if it’s a financial decision, rather than a nutritional one,” he said.
He usually buys the house-brand variety, but occasionally springs for Velveeta Shells & Cheese “because it’s really cheesy and really good.”

For reference, regular Kraft Macaroni & Cheese takes about 8 minutes to prepare once the water boils. After the noodles are cooked and drained, add half a stick of butter, a quarter cup of milk and the contents of the cheese packet, then stir those all together. Voila.

Homestyle requires a little more work, with 20 more minutes of preparation. The oven finish also requires about 15 minutes to prepare and an additional five to 10 minutes to bake, but only if you’re crazy about cheese.

Inside the box
Kraft has taken its Macaroni & Cheese Dinner brand in a number of directions over the years, some successful, some not. Kraft’s Easy Mac Cups, renamed Macaroni & Cheese Dinner Cups, launched in 2006, recently surpassed $100 million in sales. Kraft Macaroni & Cheese Crackers, cheesy, salty, noodle-shaped crackers, launched a year later, however, are no longer made.

Kraft considers its Macaroni & Cheese one of the priority brands in its U.S. business, and recently launched an advertising campaign from agency Crispin Porter & Bogusky with the tagline, “You know you love it.”

Kraft Foods, Tribune reporting

A history of Kraft Macaroni & Cheese
1937: Mac & Cheese debuted during the Depression. About 50 million boxes were purchased during World War II alone because shoppers could get two boxes for one food ration stamp.

1954: Box turns blue. For nearly two decades, Kraft’s Macaroni & Cheese Dinner came in a predominantly-yellow box

Launches include:
1975: Macaroni & Cheese Dinner with spiral-shaped noodles
1984: Velveeta Shells & Cheese
2006: Organic mac in cheddar and white cheddar
2006: Easy Mac Cups, cutting preparation time to 3.5 minutes and delighting college students. The product is now known as Macaroni & Cheese Dinner Cups.
2007:Kraft Macaroni & Cheese made from 50 percent whole gain
2010: Homestyle Deluxe Macaroni & Cheese Dinner in classic
cheddar, hearty four-cheese sauce and Old-World Italian flavors.

Kraft Foods, Tribune reporting