Velveeta organizes a comeback

New York
CNN Business
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In 2020, something amazing happened in the dairy aisle: Velveeta started stealing shelves.

Sales of the processed cheese product, which food snobs love to hate, have been in decline for years. Then the pandemic hit, and suddenly stressed, housebound people wanted Velveeta for their extra-cheesy queso, fudge and mac and cheese. The sudden interest in the brand presented a rare chance to reintroduce itself to new customers and those who hadn’t purchased Velveeta in years.

“We recognized this was a great business opportunity,” said Kelsey Rice, senior brand communications manager at Velveeta.

Velveeta wanted to make a big swing, not just to increase sales, but to establish itself as part of the culture. “We believe Velveeta is an iconic brand, and it should be seen and seen as such,” she said.

To change her image, Velveeta had to change the way she talks about herself.

That means fewer ads for affordable, gooey cheese, and more marketing stunts like cheese-scented nail polish and expensive Velveeta martinis.

Velveeta was born in 1918, according to the Smithsonian magazine. It was the brainchild of a Swiss cheesemaker named Emil Frey, who developed the product from leftover cheese while working for the Monroe Cheese Company in Monroe, New York. The Velveeta Cheese Company was incorporated in 1923, operating out of Monroe, and was purchased by Kraft (KHC) in 1927, according to the article.

When asked about the brand’s history, a representative pointed to a 2005 book published by Kraft, titled “The Greatest Thing Since Sliced ​​Cheese,” which states that Kraft introduced Velveeta in 1928, a year after funding research at Rutgers University on a processed cheese. development.

In the late 1920s, Kraft was calling Velveeta a hit.

“Never in the history of our company have we offered a cheese product to the market that was so immediately successful as Velveeta,” said a 1929 advertisement aimed at retailers. “It seems like a perfect product.”

Not only was Velveeta “delicious” and “healthy,” the ad continued, but it spread “like butter” and melted easily when cooked.

Brand marketing has evolved with the times. A 1940s advertisement noted that Velveeta was a smart wartime ingredient, offering a recipe for Velveeta Pudding with Spanish Sauce, “a hearty main course that saves you ration points”.

An advertisement from the 1950s suggested to young mothers that “while you are watching your weight and also trying to get the necessary nutrient intake from milk, make your Velveeta desserts and fresh fruit”.

In the 1970s, Velveeta was a worldwide phenomenon. A 1976 New York Times article called Velveeta a “world favorite”, adding that Kraft’s overseas sales increased 12% between 1974 and 1975, thanks in part to the product.

Over the following decades, American consumption of processed cheese continued to rise. In 1996, it peaked at 8.75 pounds per capita consumption, according to the USDA. Then things took a turn.

Two decades ago, consumption began to fall. People were concerned about the health effects of highly processed foods and started eating more natural cheese.

To make matters worse for Velveeta, in 2002 the FDA sent a letter to Kraft warning it could not use the term “pasteurized processed cheese spread” to describe Velveeta because it is made with protein concentrate from milk. Thus, Velveeta evolved from a cheese spread to a cheese product – today the company still makes Velveeta with milk protein concentrate and calls this a pasteurized recipe cheese product.

As consumer attitudes changed, Velveeta began to evolve its advertising. Advertisements showed that Velveeta was used to create an easy side dish, such as a cheese dip suitable for a party, rather than dinner.

Even changing its marketing approach, Velveeta has stuck to a few clear messages. The product is easy to handle. It’s affordable — Walmart’s website shows a 32-ounce package of Velveeta on sale for around $6.50. And above all, it can melt.

Years after processed cheese hit the market, it still melts better than natural cheeses like cheddar, noted Chad Galer, vice president of food safety and product research at Dairy Management Inc., a dairy trade association. Processed cheese contains ingredients that allow it to melt into a sort of gel when heated, he explained. When the natural cheese heats up, the oil oozes out, giving it that globular texture.

“We try to melt natural cheese like Velveeta,” Galer said. “But we haven’t unlocked that yet.”

This unique fusion quality has been Velveeta’s advertising goal for most of its life, Rice said. Now he is trying something new.

In 2018, Velveeta’s sales fell about 4.5% to $1.1 billion from a year earlier, according to IRI. In 2019, sales fell again – by around 2.4%.

But, during the pandemic, Velveeta has benefited from people’s interest in comfort foods and easy-to-cook meals. In 2020, sales of Velveeta jumped nearly 24%.

To take advantage of this movement, the brand has developed a new identity. In Rice’s words, “Velveeta exists to make outrageous pleasure a way of life.” The brand updated its logo and launched a new advertising campaign, La Dolce Velveeta, to accompany the change.

Then came the waterfalls.

In June, Velveeta began selling cheese-scented nail polish. More recently, he unveiled the Veltini – a Velveeta martini made with cheese-infused vodka and sold in select restaurants or online.

The nail polish received good reviews. The Veltini… not so much.

A Washington Post writer who ordered the drink at a restaurant said it looked “like a deranged cheese monster, with olives as piercing eyes and a rim of dripping Velveeta cheese as an unhinged mouth.” Today Show’s Hoda Kotb reluctantly tried it and wasn’t a fan. “Yuck,” she said, “No, girl, no.” Her co-host, Jenna Bush Hager, said it wasn’t bad.

Bad reviews don’t really matter to Velveeta, who is often the butt of the joke.

“Overall, we’re really happy with how the world has welcomed Velveeta Veltini,” Rice said. The most important thing is that people think back to Velveeta.

When brands make flashy marketing moves, “people pay attention,” said Bob Samples, executive-in-residence at Western Michigan University, where he teaches food and consumer goods marketing students. “They go to the store, they remember the name, they buy it.”

So far, Velveeta appears to be retaining that pandemic momentum. After falling 1.1% in 2021, sales rose 3.2% through July this year, according to IRI.

According to Samples, Velveeta has gone from benefiting from pandemic trends to high inflation environment. Because Velveeta has a long shelf life, it may be more appealing now as people try to avoid food waste to save money, he said.

Also, new ad campaign or not, people know what they are getting when they buy Velveeta.

“People know what to expect,” Samples said. There is a “feeling of comfort that goes with it”.