No-fat products are losing allure

Updated Sep 16, 2005

Fat is creeping back.

Consider the following flops:

The McLean is McGone. McDonald's finally dropped its McLean Deluxe burger last winter after years of poor sales.

Taco Bell recently said adios to more than half of its Border Lights items, a lower-fat line that had been ballyhooed with a $75-million ad campaign.

Many low-fat or fat-free foods are being reformulated. Why? So that they taste more like _ you guessed it _ the full-fat versions.

Even SnackWell's, whose fat-free Devil's Food Cookie Cakes became something of a cult object back in 1992, is losing ground. Sales of SnackWell's no-fat cookies dropped 31 percent in the first four months of 1996.


This is not to say that people are moving from no-fat to pro-fat. Far from it.

In 1995 a record 1,914 fat-modified products were introduced, according to Lynn Dornblaser, editor and publisher of New Product News. Dornblaser says that number likely will be topped in 1996, before introductions start dropping off.

What's really going on is a gustatory learning curve, in which manufacturers are trying to figure out what works and what doesn't. Dornblaser likens the current situation to a phenomenon of the '80s, when "everything that was possibly microwaveable became microwaveable, including some weird things like milkshakes." Then many of those foods flopped, and what's left are products "that make sense."

Despite the huge number of new products, in many categories the "better-for-you" incarnations constitute only about 20 percent of total sales. And at the very least, the hysteria over fat-free foods seems to be waning.

"The big burst in the beginning was fat-free," Anne Marie Johnson, Keebler's senior brand manager for cookies, confirms. "Now people seem to be looking for a little less trade-off than they originally were." They'd rather have better taste, says Johnson.

In fact, sales of fat-free cookies were down 27 percent for the first four months of 1996 compared with last year, according to IRI Inc., a market-research firm. During the same period, sales of reduced-fat cookies were down far less _ 7 percent.


As for the fat-free fall of SnackWell's cookies, Ann Smith, spokesperson for Nabisco, which makes the line, attributes it to cannibalization from the competition. "When SnackWell's was introduced in 1992, it was the only player on the block," she said. "Now there's so much to choose from."

Ed Ogiba, president of Group EFO, a new-product consulting firm in Weston, Conn., makes another point. "In a virgin market consumers were very interested in fat-free," he says. "It's easy to get them to buy the first time. It's been hard to get them to come back."

The main reason, Ogiba says, is taste. "I can't tell you how many focus groups I went to where people saw "fat-free' and said "taste-free.' "

Some companies have opted against fat-free versions for that reason, concluding that a little fat can make a big difference. Nabisco was originally working on a fat-free brownie for its SnackWell's line but changed directions at the very end.

"It was a result of consumer taste panels and our own gut feeling," says Smith. The new brownie has 2 grams of fat per serving.

Similarly, Hellmann's has been "reluctant to jump to a fat-free mayonnaise," says Phillip Wells, nutrition research associate for Best Foods Grocery Products, which makes the condiment. "Nobody's really happy with the flavor."


And the late Reuben Mattus, creator of super-rich Haagen-Dazs ice cream and the more recent Mattus low-fat ice cream, worked for two years trying to make a fat-free version before finally giving up. "He didn't like the taste," says Mitchell Berliner, owner of Berliner Specialty Distributors, which distributes Mattus products.

Some companies are supplementing fat-free lines with low-fat ones. Health Valley, for instance, one of the pioneers of fat-free baking, has just rolled out low-fat crackers and Potato Puffs and has added a couple more grams of fat per serving to its Cheddar Lites cheese puffs.

"There were production problems with the cheese's not adhering to the puffs without a little bit of fat in there," says Harry Urist, creative director of packaging for the Irwindale, Calif., firm.

Louise's, which came out with a fat-free potato chip in 1993, introduced a low-fat chip a year later. Likewise, in 1994 Entenmann's added reduced-fat baked goods to its fat-free line, "to take advantage of another niche we see growing," according to Joan Dargery, vice president of marketing for CPC Baking Business, which makes Entenmann's.

Entenmann's sees its fat-free line as holding its own. In other categories, too, fat-free does very well. Salad dressings and cream cheese are two examples.


Kraft Free salad dressings make up nearly 40 percent of Kraft's total salad-dressing sales, according to company spokeswoman Patricia Shafer. Philadelphia Free cream cheese contributes about 16 percent of the firm's total cream cheese sales, Shafer said. (Philadelphia Light makes up another 16 percent.)

Johnson from Keebler has a theory. The "additive categories," such as sour cream and salad dressings, can do well without fat because they are rarely eaten alone _ "You put salad dressing on the carrots and lettuce." Conversely, "you eat cookies, and that's the sole thing you're doing," she said. So, those have to taste good on their own.

That's why many companies are reformulating existing products or, as ConAgra's Michael Trautschold puts it, "refreshing" them. Rapid improvements in flavoring ingredients and fat-replacement technology are making this possible. And disappointing sales have made this crucial.

About a year ago, Frito-Lay "made a big change in baking" to make Baked Tostitos crisper, according to Robert Brown, corporate nutritionist. M&M Mars now uses a different ingredient, polydextrose, to replace some of the fat in its Milky Way Lite, formerly called Milky Way II. Kraft has introduced reformulated Kraft Free dressings and has changed the formula and the name of Kraft Less Fat Singles cheese product, calling them Kraft 2 Percent Milk Singles.


With 300 products in 14 categories and $1.4-billion in annual sales, ConAgra, which makes Healthy Choice, is obviously doing something right. Still, in the company's eagerness to introduce low-fat products, some were put on the shelves before they were probably ready, admits Trautschold, corporate vice president of marketing services.

As a result, products from soup to frozen dinners and ice cream have undergone changes. Fat-free cheese in block form, which was pulled from the market, is still in the process of being "refreshed."

And ConAgra learned another lesson. When the Healthy Choice line was launched in 1988, ad campaigns focused on the products' heart-healthy attributes. The company's current slogan, says Trautschold, is "Eat What You Like."

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