101 Brand Names, 1 Manufacturer
The Mass Pet-Food Recall Reveals a Widespread Practice:
Many Competing Products Come From the Same Factory
By Ellen Byron
May 9, 2007; Page B1
Pet owners have been reeling ever since tainted pet food led to the confirmed deaths of more than a dozen dogs and cats and likely sickened many more.
Some owners were also startled to learn that dozens of competing brands, from discount to premium, are all made by the same company, Menu Foods Inc. of Ontario.
Menu has recalled more than 60 million cans of pet food under more than 100 brand names ranging from Procter & Gamble Co.'s Iams and Eukanuba brands to Hill's Pet Nutrition Science Diet, owned by Colgate-Palmolive Co., to Ol' Roy pet food by Wal-Mart Stores Inc. Each was apparently affected by wheat gluten contaminated with melamine, a chemical substance with no approved use in food.
The mass recall lifts the curtain on a common practice in consumer products. From jeans to diapers to frozen fruit, competing brands, up and down the price spectrum, are often made by the same manufacturer.
In many cases, the maker of a brand-name product will also produce private-label versions. For example, Kimberly-Clark Corp., which makes Huggies diapers, also quietly produces training pants for Wal-Mart. Some companies make multiple brands in the same product category. P&G, which doesn't make private-label goods, produces both Pampers and Luvs diapers, targeting different consumers, just as it makes multiple detergents -- Tide, Gain, Cheer and Dreft. In fashion, low-profile licensees often work for many different designers. Kellwood Corp. sews clothes bearing labels from Calvin Klein to Sag Harbor.
To be sure, ingredients, designs and quality may differ substantially among the labels made under the same umbrella. "We have more than 1,300 recipes," says Sam Bornstein, a spokesman for Menu Foods. "Brands are very specific about what can go in the product, and we are governed by strict contracts and quality control and testing."
But often the main difference is marketing -- and price -- and that can be hard to sustain once products are perceived as commodities. A recent survey by GfK Roper found that 54% of respondents weren't aware before the recall that both premium and standard pet food brands were made by the same supplier. Knowing this, 26% said they were less likely to buy premium pet food, though 60% said it made no difference.
"The sheer magnitude of how many branded products come from one source erodes the whole basic premise of what branding is in the eyes of the consumer -- they feel duped," says Eli Portnoy, who heads Portnoy Group Inc., a Los Angeles-based brand-strategy firm.
What's more, when many brands are made by the same manufacturer and a problem occurs, it's harder for consumers to find a safe substitute.
The growth of contract manufacturing reflects a number of changes in manufacturing and retailing. Decades ago, most branded products were actually made by the company that owned the brands. But over the past 20 years, many big retailers have tried to differentiate themselves from competitors by offering private-label brands, which they needed to have manufactured by outsiders.
Meanwhile, consumer-product makers, facing competition from store brands, sought to increase efficiencies by making private-label versions of their own branded products, or by outsourcing their manufacturing to third parties that could do it more cheaply.
Some consumer-product companies have been forced to make both generic and branded products to please retailers. "If a major manufacturer is unwilling to produce private-label products, there's a possibility the retailer won't sell their branded products," says Burt Flickinger III, who has advised companies such as Alcoa, Del Monte Foods and Heinz on how to better manage their branded and private-label businesses. Alcoa, which owns aluminum wrap maker Reynolds, for instance, makes both private-label and Reynolds aluminum foil and plastic wrap.
Making both private-label and brand-name products does give manufacturers a hedge against downturns. But, says Jack Trout, president of Trout & Partners, a marketing strategy firm in Old Greenwich, Conn., "If the public begins to get the perception that there's not much difference, then you can't hold your prices -- that's the bottom line of the whole [pet food] scandal." He adds, "Commoditization is the real enemy of branding."
In the past, branded pet foods had an emotional advantage: Many owners were loath to give low-quality food to their pets. But even veterinary nutritionists say they have difficulty telling brands apart. "The money you spend on a [premium-brand] diet does not always equate with the quality of the food," says Andrea Fascetti, associate professor of nutrition at the School of Veterinary Medicine at the University of California, Davis. "There are no requirements around calling something a 'premium' or 'super-premium' product."
P&G argues that even products with identical ingredient lists aren't necessarily equals. "A less-expensive brand can copy an ingredient list but might not have the same combination to the way the recipe is put together," says company spokesman Kurt Iverson. The quality of ingredients and the way they are combined affects how nutrients are absorbed by the animal, he says.
Still, the labels of two similar products -- the Iams and Supervalu Inc.'s NutriPlan beef entrees -- suggest only marginal differences. Both Iams and Supervalu say their beef entrees are formulated to meet nutritional levels established by the Association of American Feed Control Officials. Each product contains at least 9% of crude protein. Iams' product has a minimum of 6% crude fat and no more than 1% of crude fiber while Nutriplan's crude fat is at least 5% and crude fiber a maximum of 1.5%. The biggest difference may be the price: A 13.2-oz. can of Iams is 99 cents, roughly double the 50 cents for a Nutriplan can of the same size.
Both products say that moisture comprises a maximum of 78% in the product. The Iams product also lists omega-6 and omega-3 fatty acids, but notes that these aren't recognized as essential nutrients by AAFCO.
Hill's, owned by Colgate-Palmolive, says its pet-food products contain nutrients tailored to a pet's life stage, activity level or health condition. "Many generic brands offer 'all-life-stages' products that do not tailor key nutrients like protein, calcium or sodium to health requirements of different ages," according to a company spokesman, who notes that Hill's manufactures more than 95% of its products in-house and is building additional plants to further increase in-house production.
Still, some veterinarians aren't convinced. Jeffrey Barrow, a veterinarian at the Marshfield Animal Hospital in Marshfield, Mass., says he used to recommend Iams and Hill's products, but for safety reasons now advises pet owners to make their own pet food, supplemented by multivitamins, until the recall fully concludes.
When I first saw these simple TV spots, they really caught my eye because typical Rangers commercials are basically announcements. So, I decided to find out who made them. Being the Texas Rangers, in DFW, I thought the agency might've been The Richards Group or another local agency. Lo and behold, the AOR (Agency of Record) is Door Number 3 in Austin! Here is what the Creative Director, Prentice Howe, had to say.
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