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ConAgra's Peter Pan Peanut Butter Set to Return Amid Huge Marketing Blitz

Aug 9, 2007 | Parker Waichman LLP, LLP

Peter Pan Peanut Butter, one of the brands responsible for an outbreak of Salmonella poisoning earlier this year, will return to stores this month.   And ConAgra, the company that manufactures Peter Pan, is planning a marketing extravaganza that it hopes will cause this year’s Salmonella debacle to fade from its customers’ memories.

Prior to the Salmonella outbreak, Peter Pan was the number three peanut butter brand in the U.S.  In February, Peter Pan and Great Value Peanut Butters were recalled by ConAgra after the Centers for Disease Control (CDC) linked those brands to several cases of Salmonella.  The peanut butter Salmonella eventually sickened 628 people in 47 states.  ConAgra faulted a leaky roof and malfunctioning sprinkler system for causing the Salmonella contamination. ConAgra’s Sylvester, Georgia plant was closed due to the recall, but reopened last week.  The company said that it has spent $15 million to repair problems at the factory.  ConAgra is also having Peter Pan manufactured by a subcontractor at another plant to build up inventory for its re-launch.

Whether consumers will want to give Peter Pan Peanut Butter another chance remains to be seen.  The peanut butter market is competitive and customers are known for brand loyalty.  No one knows if Peter Pan’s old customers will trust the peanut butter enough to abandon brands they have been using since the recall.

And Peter Pan Peanut Butter could be an even tougher sell, because ConAgra did not seem to have its customer’s best interest in mind during the recall. Though people may have started becoming sick as early as March 2006,  it wasn’t until February 2007 that ConAgra finally issued a recall of its Peter Pan and Great Value brand peanut butter.  In April 2007, the Washington Post published documents proving that the Food and Drug Administration (FDA), as well as ConAgra, knew of contamination problems at the Sylvester, Georgia plant as far back as 2004.  The FDA took few corrective measures, assuming that ConAgra would address the situation itself.  Unfortunately, whatever the company did was not enough to prevent the Salmonella outbreak.

But ConAgra claims surveys show that 83-percent of its former customers want Peter Pan to return. The company is determined to lure those customers back, and has mailed out 2 million coupons for free peanut butter, as well as $1-off coupons.  Most of those coupons went to people who contacted ConAgra about the recall.  Customers purchasing other peanut butter brands will be given a $1-off coupon at store checkouts, triggered by scans of store loyalty cards that indicate the consumer had purchased Peter Pan in the past.  ConAgra has also redesigned the Peter Pan Peanut Butter jar, and it includes a “New Look” label.  The company is also offering a 100-percent satisfaction guarantee, and will offer refunds to consumers unhappy with the product.

ConAgra says the new campaign is the biggest investment the company has ever made in Peter Pan Peanut Butter.  It is worth noting that had ConAgra invested more in its Peter Pan Peanut Butter factory prior to the Salmonella outbreak, the new marketing blitz would never have been necessary.

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