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This Spud's For You

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Frito-Lay knew it had a problem when it asked some of its consumers what its Lay's potato chips were made of and most had to give the question some thought.

Instead of spuds, consumers thought of the factory. They deemed the product "heavily processed, full of preservatives and one-third of Americans didn't realize it was made with potatoes," recalls Frito-Lay marketing vp Gannon Jones. "When we heard that point, we were like, 'Wow! I can't believe that!'"

How did this happen? The disconnect was emblematic of the larger forces shaping the food industry: Given Big Food's numerous product recalls, confusion about what's organic and what's not and the medical community's increasing demonization of salt, consumers don't trust their food.

For Lay's, the problem was particularly vexing. In 2008, the PepsiCo-owned brand had seen consumption declining among its most passionate fans for the past three years. The times just weren't right for an indulgent snack. Lay's venerable tagline, "Betcha can't eat just one," was actually backfiring. According to market research, the tag prompted consumers to cut back on their consumption of the chips. Such people "still love Lay's, but they were having second thoughts," says Justin Lambeth, a Frito-Lay marketing vp who helped conceive of, and then lead, the initial repositioning strategy that followed. (Jones oversaw the subsequent marketing effort.) Consumers also had no idea where Lay's were made.

So Lay's did a total 180. In February 2009, the brand launched a campaign that was all about potatoes. The effort wound up restoring sales by linking the product to spuds, dirt and farming. The result was a dramatic recovery. According to PepsiCo, the chip brand actually grew the most of any packaged-goods product last year, with dollar sales up 13.3 percent to $1.6 billion. Lay's dollar sales rose 28.4 percent from the time the campaign launched (February 2009) to the four weeks ended July 11, the most recent period for which data was available, per SymphonyIRI. (The data excludes Walmart, club and liquor store sales.)

On the other hand, prior to the campaign, the brand looked like a helpless giant. Lay's is not only the nation's favorite potato chip with a 64.3 percent household penetration, it is also the largest U.S. food brand. That, however, gave the marketers a lot to work with. The 72-year-old Lay's is ingrained in consumers' childhoods, showing up everywhere from Fourth of July barbecue parties to Sunday football games with dad, research found.

That brand lineage, combined with the fact that Lay's is actually made with three simple ingredients -- "potatoes, all-natural oil and a dash of salt" -- gave the agency, Juniper Park, the eureka moment for what the campaign should look like. "[We needed] to tell people what these things are made with, [so] they love eating them and feel good about eating them as well," says Terry Drummond, executive creative director at the Omnicom agency, which worked with Lay's on the effort.

Hence the new tagline, "Happiness is simple." While equating potato chips with happiness may seem a stretch, the thinking was that, in most cases, the target consumer is a woman who is also the "memory keeper in her house, the one who takes the photographs of the family and puts them in frames and hangs them up on walls," Drummond says. Since Lay's plays a huge part in consumers' early and adult childhood life, it's also part of that happiness. "It's a value we took to heart," Drummond says of his team's recognition and adherence to that concept in the making of the campaign. As an example, "How many people have gone to school, opened up their lunch boxes and found a bag of Lay's put in there by their mothers?"

The resulting campaign began with a spot, dubbed "Fireworks," which showed salt-of-the-earth workers gathered for a ritual harvesting of potatoes. As men, women and children rush to the fields with wagons, baskets and lawn chairs, a lone farmer unearths a potato from the ground. A group of children motion for him to hurriedly come back, and then it's revealed why: Potatoes start shooting up from the ground and exploding into Lay's potato chips. The spot then zooms in on a little girl with a red dress, snacking happily on the chip. The voiceover reminds consumers of Lay's three ingredients.

Next followed a series of regional and national ads that featured farmers whose potatoes eventually wind up in Lay's bags.
 
Lay's, in turn, knew it'd hit pay dirt when retailers started responding. Lambeth, of Frito-Lay, recalled the case of one retailer that had "a reputation of being really tough on price" steering away from the topic and diving right into Lay's local efforts at the start. "[Our CEO, Al Carey] got into the meeting and all they wanted to talk about was Lay's local," he says. "That's when I realized how big of an idea this was."

Frito-Lay has since extended the campaign. Other elements include a Lay's Happiness Exhibit, in partnership with People magazine, which encouraged consumers to share their happy memories -- via photos -- with others. It even went as far as to install growing spuds on the ceiling of the Jackson subway tunnel in Chicago to emphasize the fact that Lay's are really grown at home. To offer incontrovertible evidence of the fact, Lay's recently kicked off a mobile greenhouse tour across America so visitors can see growing potato plants and meet some of its farmers.

Lynn Dornblaser, an analyst who tracks packaged-goods trends at Mintel, says Lay's has successfully educated Americans about where potato chips come from: "Lay's doesn't make any claim to be healthy or something that's good for you. They talk about being a delicious treat. But to be able to marry that with [simple, familiar ingredients] is really smart."


Farm Aid

Ads for Lay's, from Juniper Park, underscored the fact that the chips are made from potatoes by spotlighting real farmers. One, Brian Kirschenmann, is a fifth-generation potato farmer whose great, great grandfather supposedly brought the first potato to California. In another ad, farmers identified as "Big Jack" and "Little Jack" note that their family has been growing potatoes for Lay's since 1964. And Darrell McCrum, a farmer in Mars Hill, Maine, jokes that he thinks that he "recognizes that one," when munching on a Lay's chip while standing in front of a giant mound of potatoes.


Justin Lambeth and Gannon Jones photographed by Van Ditthavong