ConAgra sets Peter Pan relaunch

By Brad Dorfman

CHICAGO (Reuters) - ConAgra Foods Inc (CAG.N) is gearing up to bring Peter Pan back to life.

The company plans to relaunch the brand this month -- which was pulled from store shelves because it was tainted with salmonella -- with a new jar, a money-back guarantee and an extensive direct marketing campaign.

"Our full intent is to regain the trust from both our consumers and our (retail) customers so that we can regain the business that we had, or even more," David Palfenier, president of grocery for ConAgra, said in an interview with Reuters on Tuesday.

Peter Pan, the No. 3 U.S. peanut butter brand, was pulled from store shelves in February after it was linked to cases of salmonella. The Centers for Disease Control said that 628 people in 47 states got sick during the outbreak, which began a year ago.

The salmonella contamination, which ConAgra says most likely was the result of a leaky roof and faulty sprinklers, caused the company to shut down its Sylvester, Georgia, plant, the company's lone peanut butter plant.

The plant reopened this week and ConAgra has also contracted with an outside supplier to build up inventory.

But the peanut butter aisle is also very competitive, so it may be difficult for ConAgra to win back all its customers that have since moved on to other brands, said Tim Calkins, clinical professor of marketing at Northwestern University's Kellogg School of Management.

"Peter Pan will regain some of its market share, but it's unlikely it will be back where it was, and it certainly is not going to be bigger for the experience," Calkins said.

FREE PEANUT BUTTER

ConAgra hopes otherwise. The company plans to try to reach 2 million consumers with a direct marketing campaign, offering coupons for a free jar, as well as $1-off coupons for up to three friends.

Those consumers are people who have previously contacted ConAgra either about the Peter Pan recall or to find out when Peter Pan would return to store shelves.

Additional Peter Pan consumers will also be reached with $1-off coupons at grocery checkout lines, triggered in part by scans of shopper loyalty cards that show they bought Peter Pan in the past. In total, ConAgra hopes to reach 5 million Peter Pan consumers with this direct marketing approach.

Additionally, the company will use full-page inserts in major periodicals as part of the relaunch campaign.

Palfenier would not say how much ConAgra planned to spend on the relaunch.

"It's the single-largest investment we've ever made in Peter Pan," he said.