Oscar Mayer Foods Corporation

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Oscar Mayer Foods Corporation

also known as: oscar-mayer founded: 1883

Contact Information:

headquarters: 910 mayer ave.

madison, wi 53704 phone: (608)241-3311 url: http://www.oscar-mayer.com

OVERVIEW

Oscar-Mayer is a manufacturer of luncheon meats, hot dogs, bacon, pickles, and other packaged food products. The company says it is the market share leader in every category in which it competes—from luncheon meats and hot dogs to bacon and lunch combinations.

In the 1990s, Oscar-Mayer focused on creating innovative new products and new product categories. For example, it was one of the first companies to produce light and fat-free luncheon meats as part of its Oscar-Mayer and Louis Rich lines. Oscar-Mayer also created a new category, lunch combinations, and the company was dominating that market with its Lunchables brand in the late 1990s.

Oscar-Mayer, with headquarters in Madison, Wisconsin, operated 10 plants throughout the United States as of 1997. The company produces food products under the brand names Oscar-Mayer, Lunchables Lunch Combinations, Carving Board Meats, Louis Rich, and Claus-sen pickles.

In 1996 Oscar-Mayer reported that its sales volume continued to grow strongly, up 4 percent over the previous year, with gains in market share for its cold cuts, hot dogs, bacon, and Claussen pickles. The company also reported strong volume growth for its Oscar-Mayer Lunch-ables Lunch Combinations.

In 1992 the company began to operate Hot Dog Construction Company food outlets, and 20 stores were open by 1994. The retail units were built by Oscar-Mayer's Branded Restaurant Group subsidiary. Products included hot dogs and toppings, french fries, salads, pizza, and breakfast items. The outlets were located in transportation terminals, schools, companies, and recreation areas.

COMPANY FINANCES

Oscar-Mayer is 1 of 4 brands of Kraft Foods that generate yearly sales of more than $1 billion. In fact, during the tenure of chief executive officer Robert Eckert, from August 1993 to August 1996, Oscar-Mayer's sales volume rose 4.5 percent per year, roughly four times the industry average. The company's profits grew an average of 26 percent per year, lifting total sales to more than $2 billion per year.

HISTORY

Oscar F. Mayer and his brother, Gottfreid, founded Oscar-Mayer as a retail meat market on Chicago's near north side in 1883. On their first day in business the brothers had sales of $59. Over the years, the brothers developed their company into a strong regional, and eventually national, meat firm. In 1919 the corporate name was officially changed to Oscar-Mayer & Company. In 1936, the company introduced what would become its most famous promotion: the Wienermobile—a car shaped like a hot dog that cruised the streets of Chicago.

In 1948 Oscar-Mayer introduced the first self-service meat package, which was sold in supermarkets. Also in that year, the company introduced the "Slice Pak" process, which produced sliced cold cuts sealed in transparent packages with metal bases. In 1957 Oscar-Mayer moved its headquarters from Chicago to Madison, Wisconsin, and by the early 1960s, the company was the leading U.S. manufacturer of processed meats. In the 1970s, Oscar-Mayer expanded into the pickle and turkey industries by acquiring C.F. Claussen and Sons in 1970, and the Louis Rich Company in 1979.

For nearly a century, Oscar-Mayer remained an independent company owned primarily by descendants of Oscar and Gottfried Mayer. In 1981, however, the company was acquired by General Foods. In 1985 General Foods was in turn acquired by Philip Morris Companies, which three years later also acquired Kraft USA. In 1989 Philip Morris merged the two divisions to form Kraft General Foods. The name was changed to Kraft Foods in 1995.

STRATEGY

Like other divisions of Kraft Foods, the primary business strategy at Oscar-Mayer in the late 1990s was to create and sustain leading brands and build the value of those brands through effective advertising and marketing. At the same time, Oscar-Mayer aggressively pursued opportunities to reduce costs and improve overall profitability. The goal was to manage all of its brands effectively so that they produced high profit margins. Products that could not produce were eliminated.

Another Oscar-Mayer business strategy was to capitalize on several major 1990s food trends. For example, its Lunchables Lunch Combinations appealed to working parents with little time to spend preparing lunches for their school-age children. Also, Oscar-Mayer's fat-free meat products were marketed to consumers looking to lower their overall consumption of fat and calories.

The Oscar-Mayer division was part of a major change in sales strategy at Kraft Foods in the mid-1990s. Kraft unified its sales force into one unit, instead of having different sales forces for different divisions. This reportedly boosted volume of many Kraft brands, including Oscar-Mayer. Customers found doing business with the company simpler and more profitable, according to Kraft Foods.

Special promotions were also a key part of Oscar-Mayer's marketing strategy. In January 1996, Oscar-Mayer sponsored the Super Bowl halftime show for $2.5 million. Oscar-Mayer sponsored a second show at the Super Bowl in January 1997. It cancelled support for a third show in January 1998 because it felt that the 1997 program was not "family-oriented."

Oscar-Mayer also formed partnerships to promote its products and increase its marketing presence. With the Fox Kids Network and Parachute Consumer Products, in 1998 Oscar-Mayer tailored a marketing promotion around the top-rated kids television show, Goose-bumps 2000.

INFLUENCES

Oscar-Mayer leads the market segment in product and packaging innovations. In 1948 the company introduced the first shingled sliced bacon in a self-service meat package. In 1950 the company produced sliced cold cuts vacuum sealed in transparent packages with metal bases, which it called the "Slice pak" process. Oscar-Mayer continued to develop new products to meet the needs of modern society, such as Lunchables, which have grown popular with busy people in a rush to prepare lunches.

FAST FACTS: About Oscar Mayer Foods Corporation

Ownership: Oscar-Mayer is a wholly owned subsidiary of Kraft Foods Incorporated, which in turn is a subsidiary of Philip Morris Companies.

Officers: John Bowlin, Pres.; Rick Searer, VP & Gen. Mgr.

Employees: 10,000

Principal Subsidiary Companies: Oscar Mayer Foods Corporation has two main subsidiaries, Claussen Pickle Company Incorporated and Louis Rich Company.

Chief Competitors: Oscar-Mayer competes with other companies producing and selling processed meats and related products. Some primary competitors include: Best Kosher Sausage Corporation; Bil Mar Foods; Carl Buddig; ConAgra; Eckrich; Hillshire Farms; Hormel Foods Corporation; Hygrade Food Products Corporation; Land O' Frost Incorporated; Vlasic Foods Incorporated; Vienna Beef; and WilsonFoods.

CURRENT TRENDS

Oscar-Mayer also worked hard to develop its online presence in the 1990s, posting an impressive World Wide Web site with everything from fun for the kids to nutritional information for the parents framed in a lively, colorful format.

In 1997, Oscar-Mayer inadvertently became involved in an animal rights debate when People for the Ethical Treatment of Animals (PETA) conducted protests against Oscar-Mayer's Wienermobile. The 10 Wienermobiles made more than 400 stops nationwide in 1997, and PETA targeted 50 stops for protests. At the Wiener-mobile stops, children interested in starring in Oscar-Mayer commercials auditioned, singing the well-known "Oscar-Mayer Wiener Jingle" or the "Bologna Song." After the children began singing, the protestors used megaphones to chant slogans such as "Cruelty we won't tolerate! Get the slaughter off the plate!" and "Oscar-Mayer is to blame! Exploiting children is a shame!"

According to the Washington Post, parents at one such protest became very angry with the protestors. Three television cameras that had arrived with PETA focused on the confused faces of the children, which was not the result for which PETA had hoped.

CHRONOLOGY: Key Dates for Oscar Mayer Foods Corporation

1883:: Oscar F. and Gottfreid Mayer establish a retail meat market in Chicago, Illinois
1911:: Incorporates as Oscar F. Mayer & Bro.
1919:: The company name is changed to Oscar-Mayer & Company
1924:: Oscar-Mayer introduces packaged sliced bacon
1936:: The Wienermobile makes its debut on the streets of Chicago
1944:: Pioneers a way to package hot dogs together in bunches
1963:: The "Oh, I wish I were an Oscar-Mayer wiener" jingle debuts
1970:: Acquires C.F. Claussen and Sons
1973:: The "My bologna has a first name," jingle debuts
1975:: Sales top $1 billion for the first time
1979:: Acquires Louis Rich company
1981:: Oscar-Mayer is acquired by General Foods
1989:: Introduces Lunchables to revitalize sales
1998:: Brings back the Wienermobile for the first umbrella ad campaign in a decade

YOU SAY BOLOGNA, I SAY BALONEY

Advertising jingles and slogans come and go, but some are as timeless and memorable as a Shakespearean sonnet or a Led Zeppelin guitar riff. One such jingle is the Oscar Mayer song, which celebrates a young boy's love for his baloney. As advertising gurus might say, this jingle has "legs," and it has earned a permanent place in the pantheon of American culture. If you're a little fuzzy on the lyrics, here it is in its entirety:

My bologna has a first name. It's O-S-C-A-R.
My bologna has a second name. It's M-A-Y-E-R.
Oh, I love to eat it every day, and if you ask me why, I'll say: 'cause Oscar Mayer has a way with B-O-L-O-G-N-A.

PRODUCTS

In 1992 Oscar-Mayer introduced Healthy Favorites Cold Cuts and Breakfast Meats and, in 1993 introduced Louis Rich Carving Board Sliced Meats in resealable packaging. In 1994 the company introduced its Oscar-Mayer Lunchables "Fun Pack" and Louis Rich Fat Free Turkey. In 1995, four varieties of Oscar-Mayer Pizza Lunchables, Carving Board Chicken, Oscar-Mayer Fat Free Hot Dogs, Bologna, Chicken, and Ham; and Claus-sen Sandwich Slices Pickles were introduced. Also in 1995, Oscar-Mayer began offering adult-sized low-fat versions of its Lunchables products. The adult lunch kits included a drink, a fat-free dessert, and healthy lunch foods such as low-fat cheese and lean turkey breast.

While promoting new products, Oscar-Mayer returned to its roots with a 1998 advertising campaign put together by the J. Walter Thompson agency. The agency brought back the Wienermobile and Wienerwhistle in the first umbrella ad campaign by the company in a decade.

CORPORATE CITIZENSHIP

Both Oscar-Mayer and its parent company, Kraft Foods, focused the majority of their community-giving programs in three areas benefiting children at risk: education, nutrition, and culture and the arts. From 1991 to 1996, Kraft contributed more than $175 million in financial support and food products to community organizations throughout the country. In addition, Kraft and Oscar-Mayer annually provided grants to local Madison, Wisconsin, programs and organizations.

THE BIRTH OF THE WIENERMOBILE

In 1936 Carl G. Mayer, nephew of the founder of Oscar-Mayer, developed an advertising idea for his family's company that would eventually become their unofficial mascot and symbol. He wanted a spectacular vehicle to transport the "world's smallest chef, Little Oscar." He had the General Body company of Chicago, Illinois, design a vehicle shaped like a giant hot dog with two open cockpits in the center and rear. The 13-foot hot dog on wheels was christened the "Wienermobile."

Throughout the years the Wienermobile has undergone many changes. Five new vehicles were made by the Gerstenlager Company from 1950 to 1953. They were built on a Dodge chassis and lengthened to 22 feet. The new "dogs" came complete with sound systems and sun-roofs. In 1958 Brook Stevens designed a futuristic Wienermobile on a Jeep chassis. This was the smallest version of the Wienermobile that also had buns for the first time, along with a clear, glass, bubble nose.

The next change came in 1969 when two new vehicles were created by Oscar-Mayer mechanics themselves. They used auto parts from various companies, and the same mold that they had created was used until 1988. In that year six 23-foot-long Wienermobiles hit the streets. These vehicles featured microwaves, refrigerators, cellular phones, and stereo systems (which of course played 21 different versions of the Oscar-Mayer Wiener jingle.) These huge dogs were "piloted" by hotdoggers or crew members that stayed with the vehicle and were similar to tour guides. The new vehicles were dispersed as far as Japan and Spain to spread the Oscar-Mayer name all over the world.

In 1995 automotive designer Harry Bradley created a concept Wienermobile for the year 2000. The state-of-the-art, 27-foot long, 11-foot high dog can reach speeds up to 90 miles per hour. It comes equipped with video equipment, a big-screen television, and a hot dog-shaped dashboard and glove box. How's that for hot dog fun?

EMPLOYMENT

Oscar-Mayer's employee relations philosophy in the late 1990s was to develop and maintain a work environment where employees could work toward and grow to their fullest potential while providing superior quality products and services. "Inherent in this philosophy is a belief in the fundamental values of employees and in the importance of maintaining a work environment that treats all employees with care, dignity and respect," according to the company.

SOURCES OF INFORMATION

Bibliography

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