Duncan Hines introducing keto-friendly cake mix - Food Dive

Dive Brief:

Conagra Brands is refreshing the Duncan Hines brand in 2020 with keto versions of its cake mixes, co-branding with Oreo and a packaging redesign, according to a transcript of a December earnings call with President and CEO Sean Connolly.
Other initiatives that the company is taking to reframe the brand include introducing new flavors and working on more shelf-stable and frozen snacking options.
Connolly noted that efforts to reimagine the shelf-stable baking mixes earlier in 2019 resulted in a jump in share prices during the holiday season and an overall 7.3% increase in Conagra's sweet treat sales in the most recent quarter.

Dive Insight:

Conagra is stepping into 2020 with a plan to provide keto consumers an option to indulge. The ketogenic diet is a low-carb, high-fat regimen that has become popular in the last several years. It also inherently excludes cake from the mix. However, Conagra wants to show consumers that keto-friendly cake CPG alternatives exist.

Since Conagra acquired Pinnacle Foods for $10.9 billion in 2018, the company has invested resources in growing Pinnacle's three largest brands: Duncan Hines, Birds Eye and Wish-Bone. Refreshing a legacy brand like Duncan Hines with a keto recipe could help bring in younger consumers. Much like Whole30, paleo and Atkins before it, the keto diet has seen rapid growth in recent years. Technavio predicts the global keto diet market is poised to grow by an annual rate of 5% to $1.11 billion by 2023.

The diet’s continued growth has motivated manufacturers to provide consumers with packaged options that cater both to restricted ingredient lists and the modern desire for on-the-go goods. Ancient Nutrition is a brand that makes bone broth protein a popular and portable option for those following a keto diet. Danone has Two Good, a low-fat, low-sugar Greek yogurt that caters to the keto lifestyle. It also promotes digital tools like MyKetoPlanner that the company's experts developed.

Although many of the keto CPG options fall into the snack food and meal categories, there are also numerous keto dessert options on the market. Keto and Company makes buttercream frosting, Thrive Market offers a keto chocolate chip cookie mix and ThinSlim Foods makes keto brownies.

Providing products tailored to a niche of consumers can be risky. While lucrative when a diet is fashionable, once the fad reaches its end and the number of dieters dwindles, these products become passé. Low fat cookie brand SnackWell's epitomizes this conundrum. The brand had brought in about $490 million in sales in 1995, when low-fat diets were the rage. When B&G bought SnackWell's and granola brand Back to Nature in 2017, analysts estimated that both brands put together were worth $80 million in sales.

Worse yet, if a diet is found to be detrimental to one's health, products associated with it become quickly and widely blacklisted from consumers' grocery lists.

Perhaps that is a leading reason why other large brands like Bob’s Red Mill, Pillsbury and Betty Crocker chose to market products that can be used by keto customers as either gluten-free or sugar-free rather than calling out the diet itself on the label. Those keywords, while they can be integral components to a keto diet, are much more widely accepted by mainstream customers and can give products a longer shelf life if the keto diet falls out of fashion.

As it stands, the keto diet is still showing signs of growth, so Conagra's injection of money and R&D into its keto-friendly products has a good chance of paying off in the short term. And it could help that Conagra is one of the first major manufacturers to offer a cake mix that caters explicitly to this diet.

Reimagining the cake mixes for modern lifestyles also has the advantage of launching the brand back into the public eye for the long term. Even if the keto products themselves fade away, by giving shoppers a reason to try the product, Conagra could be creating a conversation that could takes the Duncan Hines brand from a grocery item of years past into a modern must-have for years to come.

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