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    GROCERY: Peanut Butter: Spread the word

    Once strictly kid stuff, peanut butter is now positioning itself, through health-conscious and gourmet products, as a grown-up food.

    Peanut butter’s days as the archetypal kids’ sandwich filler, usually accompanied by its old pal jelly, are on the wane. Increased awareness of sometimes deadly peanut allergies (according to the Fairfax, Va.-based Food Allergy and Anaphylaxis Network, peanuts are the leading cause of severe food allergic reactions), coupled with concerns about high fat content and additives such as sugar, has effectively kept peanut butter out of school lunchrooms for a generation.

    In the meantime, however, manufacturers and retailers are recasting peanut butter as the ultimate comfort food for adults, backed by new studies showing the nutritional advantages of peanuts, and a fresh crop of indulgent and healthier products designed to appeal to a more mature crowd.

    A heart-healthy food boasting 13 vitamins and 26 minerals, peanuts are also naturally cholesterol-free and low in saturated fats. Some research even suggests that women who regularly consume peanut butter may lower their risk of developing type 2 diabetes.

    Peanuts and peanut butter took a "serious hit" during the low-fat fad of the 1990s, when there was "no differentiation between good and bad fats," says Atlanta-based National Peanut Board president Marie Fenn. But now "nutritional information is changing, and we're right in line with the trend."

    Retailers are also noting consumers' preoccupation with what they're putting in their bodies, and how it's affecting the composition of the peanut butter aisle. "This year we're seeing more natural peanut butters than last year," says Vivian King, director, public affairs for Milwaukee-based Roundy's Supermarkets, which operates 135 stores in Wisconsin, Minnesota, and Illinois under the Pick 'N Save, Copps Food Centers, and Rainbow Foods banners.

    Although the recent popularity of high-protein regimens made nuts and legumes more acceptable for snacking, maintaining category growth has been a challenge. "The USDA reported a spike in peanut butter production in 2004 vs. 2003," notes Garth D. Neuffer, senior director, product PR, corporate communications at Omaha, Neb.-based ConAgra Foods, manufacturer of Peter Pan Peanut Butter. "Some of that growth was likely due to the low-carb diet phenomenon. However, now that the low-carb craze has waned, growth in the category has slowed somewhat."

    ACNielsen Strategic Planner figures illustrate the impact on retail. For the 52 weeks ended Feb. 25, 2006, for total U.S. food stores with $2 million or more in sales (excluding supercenters), dollar sales of peanut butter were down 1.0 percent, after slight rises of 0.6 percent and 1.2 percent for 2004 and 2005, respectively. Sales dollar figures for U.S. food, drug, and mass merchandiser stores for the 52 weeks ending Feb. 25, 2006 show a similar pattern.

    Even at Wal-Mart, peanut butter hasn't been selling quite as much of late: For the 52 weeks ended Nov. 5, 2005, peanut butter sales dollars increased 14.3 percent, vs. 16.7 percent in the year-ago period, according to the ACNielsen Wal-Mart Channel Service.

    Still, the news is far from all bad for peanut butter, which continues to be a staple food for many consumers, even as it assumes a lower profile. IRI data supplied by the National Peanut Board shows that consumption of peanut butter, as measured in jars, has risen 10.6 percent from the first quarter of 2001 through the end of 2005.

    An additional challenge for the peanut category is to deal with the one of the biggest concerns among consumers -- preventing allergic reactions in family members. All of the major peanut butter brands have sections on their Web sites devoted to allergy awareness, and industry players agree that proper labeling is key.

    Says Lee Zalben, founder of New York-based Peanut Butter & Co., which offers gourmet varieties of the food both in its Greenwich Village specialty shop and at retail, "Clear, easy-to-understand labels are essential tools that food manufacturers must provide the public in order to avoid accidental consumption of allergens."

    Most proactive of all is the National Peanut Board, which has formed a worldwide scientific advisory panel of experts from the United States, the United Kingdom, and Canada to conduct research in such areas as a vaccine for peanut allergies, in addition to creating a school education kit to raise food allergy awareness in children.

    One way to combat lackluster sales is to come out with novel products, which manufacturers have not only done, but have also offered in a whole new context -- peanut butter as decidedly grown-up fare.

    Zalben says Peanut Butter & Co.'s focus is on "innovative flavor combinations that offer a 'good-for-you' indulgent treat at an attractive price." With all-natural varieties including Crunch Time, Dark Chocolate Dreams, and The Heat Is On, the company's approach has so far been a success: Since introducing its wholesale peanut butter line to retail in June 2003, "sales have doubled every year, and we are now sold in 5,000 retail outlets nationwide," says Zalben.

    Another route is to meet the specific health concerns of adult consumers. Watermill, N.Y.-based Wonder Natural Foods Corp. has done just that with Better 'n Peanut Butter, a product the company bills as "the only patented low-fat, low-calorie diet peanut butter," with 85 percent less fat and 40 percent fewer calories than regular peanut butter. The gluten-free, low-sugar product additionally comes in a low-sodium version.

    Of course, for the increasing number of people with diabetes, peanut butter with healthy attributes is a must. Mendham, N.J.-based FIFTY 50 Foods, whose name comes from the fact that half of the company's products fund diabetes research, makes food exclusively for people with the condition. Recounts FIFTY 50 president Gary Russell: "Our creamy and crunchy peanut butters were added approximately 10 years ago to complement our line of sugar-free fruit spreads....The peanut butter has [since] jumped to [become] one of our top-five-selling products."

    Even Unilever's Skippy came out with a natural product last year in response to the consumer trend. Skippy Natural promotes itself as the only natural peanut butter without the ubiquitous oily top layer caused by the absence of stabilizers. Food purists, however, note that the product contains palm oil, a saturated fat.

    Forever young

    All of this emphasis on adults, however, doesn't mean that manufacturers don't still have an eye on their core consumers: kids. For instance, in 2005 Skippy rolled out Trail Mix Bars in Nutty S'Mores and Triple Nut flavors as an addition to any kid's lunch or snack options. Earlier product introductions include Skippy Snack Bars, featuring peanut butter and granola paired with such ingredients as fudge and marshmallows, and Squeeze Stix snacks and the Squeez' It peanut butter tube, offering children both fun and portability.

    Peanut butter manufacturers have also been busy promoting their products -- and connecting with kids. Earlier this year Smucker's Jif held its fourth annual "Most Creative Peanut Butter Sandwich" contest, with a grand prize of a $10,000 college scholarship fund. This year's winner was 7-year-old Shannon Lewis of Manalapan, N.J., who triumphed with her Peanutty Pretty Purse Pitas, consisting of Jif Creamy peanut butter, strawberry-banana squeezable yogurt, a fresh banana, and fresh strawberries in a whole wheat pita.

    Appealing to children through their current favorite movies is also a smart move. "In terms of promotions, Peter Pan has had recent success tying in with entertainment properties like The Incredibles and Madagascar," notes ConAgra's Nueffer.

    Retailers, too, have been emphasizing the kid connection through participation in high-profile events. Roundy's is a proud sponsor of the Great Peanut Butter and Jelly Challenge, an annual food drive that supplies peanut butter and jelly to hungry children in the Milwaukee area. The Great PBJ Challenge, which marked its third year in October 2005, encourages schoolchildren to donate jars of peanut butter and jelly to America's Second Harvest of Wisconsin. Members of the public were also able to donate jars at the 38 participating area Pick 'N Save stores with collection barrels featuring Milwaukee Bucks guard T.J. Ford, the drive's spokesman. Other event sponsors included Jif/Smucker's and Skippy. The 2005 drive raised over 16 tons of peanut butter and jelly.

    Meanwhile New York-based Dean & Deluca, a multichannel retailer of gourmet and specialty foods, premium wines, and high-end kitchenware operating 14 stores and cafes, as well as marketing its private label products to other retailers and wholesalers, runs promotions squarely focused on the needs of its younger customers. According to buyer/merchandise manager Leah Rosenthal, "In late summer we promote peanut butter for 'back to school' by raising it to eye level on the shelves and displaying it on feature tables and countertops."

    An important indication of peanut butter's ubiquity for adults and kids alike is its increasing usage in a wide range of items. Additionally, the rising popularity of Asian and Latin cuisines, which incorporate peanut butters and pastes into their dishes, further encourages consumers to try the product in new ways.

    Next on the horizon for peanut butter, observers agree, is a "huge continuation of [current] trends," in the words of the National Peanut Board's Fenn, with health and wellness, convenience, portability, the mainstreaming of specialty flavors, and the acceptance of peanut butter as a center-of-the-plate item all poised to keep growing. With these trends firmly in mind, her organization has been actively encouraging the cross-merchandising of peanut butter and fresh produce through the adoption of innovative packaging solutions pairing the food with apples, celery, and vegetable trays, such as those that appeared at the FMI Show last year. According to Fenn, "There's still a lot more to be done -- more places to go."

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