JULY 30, 2001
Baseball and hotdogs
|Partnerships between stadiums and hot dog companies capitalize on an all-American summertime tradition. Sales at the ballpark can translate into higher profits at the checkout stand as well.||
MEAT&POULTRY, June 1, 2001
Meat processors, however, are more interested in capitalizing on other fan favorites, with names like the "Fenway Frank," "Dodger Dog" and the "Mariner Dog." During baseball season hot dog sales are hotter than a Randy Johnson fast ball. And when umpires howl "play ball," in major league ballparks across America, its music to the ears of hot dog processors everywhere. The spike in hot dog sales during baseball season is undeniable and well documented, with a growing number of companies profiting from its popularity.
Companies are all too aware of the windfall that accompanies a contract to be the exclusive supplier of hot dogs for ballparks, not so much because of the profitability, but more for what they call priceless exposure to a targeted group. Fees paid to stadium operators for the right to be the exclusive hot dog vendor start at about $50,000, making the immediate profitability minimal at best.
Representatives of the fortunate few say while ballpark sales are respectable, the bang for their buck is realized in the form of marketing and advertising at the ol ball game. Whether the stadium works through a national concession provider or directly with the processors, giving fans a quality ballpark experience, right down to the food they eat, is a priority for stadium operators and a huge opportunity for hot dog and sausage processors.
A fan favorite:
Officials from the National Hot Dog & Sausage Council (an offshoot organization of the American Meat Institute) Arlington, Va., say most baseball fans are as rabid about their hot dogs as they are about their favorite team. The pairing goes back to the days of Ruth and Maris, says Josee Daoust, spokeswoman with the Council. "Theyve been coupled from the very beginning," she says.
Despite all the varieties of foods available at todays ballparks, which includes everything from sushi to Chinese cuisine, Daoust says the demand for hot dogs is secure as ever. A total of 27 million hot dogs are expected to be consumed during the 2001 baseball season, which would top the previous season by 300,000.
Jacobs Field, home of the Cleveland Indians, is expected to sell nearly 2 million hot dogs during the 2001 season, making it the king of the hill among major league teams. Even small market stadiums, like Kauffman Stadium in Kansas City, Mo., are expected to sell about 600,000 units this year.
On opening day in PNC Park, the new home of the Pittsburgh Pirates, more than 8,500 hot dogs were sold, according to figures from Aramark, the facilitys Philadelphia-based concession provider. Aramark, which manages services at 13 M.L.B. parks estimates those locations served 205,000 hot dogs during this years opening day games.
The ongoing love affair between baseball fans and hot dogs is attributed to an emotional link, says Daoust, "because its so nostalgic. Hot dogs are as American as apple pie." If anything, a larger variety of food options at the ballpark is good for the industry, because it also means an opportunity to expand the varieties of hot dogs. "Sausage consumption is way up across the board," says Daoust, and fans will likely find a concession menu of hot dogs as well as a variety of sausages in most ballparks.
Dodger Blue and the color of money
In the early 1960s, the Los Angeles Dodgers were looking for a hot dog supplier for their stadium. As fate would have it, hot dog-producing Farmer John, based in Vernon, Calif., had just lost its longtime marketing and advertising vehicle, Polka Parade. Steve Kolodin, vice president of marketing for Farmer Johns parent company, Clougherty Packing Co., says it was ideal timing for the company, which then, was more than 30 years old. "The opportunity arose at a time when we were looking around for something to hitch our brand to," says Kolodin. Executives from both parties met, discussed and agreed that Farmer John would be the next hot dog of the Dodgers. "The entire agreement was done on handshake," says Kolodin.
Since then, the relationship has flourished, and Farmer John is approaching its fourth decade of processing some of the most popular concession items in the league.
Back when the deal was made, a little-known radio announcer, named Vin Scully, was the voice of the Dodgers and, between plays, was the pitch man for advertisers including Farmer John. Today, most of the games are televised, and still calling the plays is Scully. He has earned icon status among Dodgers fans and throughout baseball, and to this day, the legendary announcer still does promotional spots for Farmer John, which Kolodin says gives his products unmatched credibility. "Vin still does our spots that run two times per game and are prerecorded. Hes as closely linked with Farmer John as he is with the Dodgers."
Despite the decades of success of Farmer John at the ballpark, stadium sales do little to enhance the companys already thriving retail sales. Kolodin estimates unit sales at Dodger games to be just under 2 million units per season, compared to more than 24 million pounds of hot dogs sold at retail outlets each year. The two venues, "Are not related at all," he says, although there is a variety of hot dogs available in grocery stores that is exactly the same as the ballpark product. Because of copyright issues, though, the Dodger Dog-like product can only be labeled as offering "ballpark taste."
Farmer John also has its products in other high-profile arenas and stadiums including: the Rose Bowl Coliseum; Staples Center; the Forum; and Qualcomm Stadium. Having already established a sports presence in many venues, Farmer John is no longer chasing down stadium deals. Nowadays, says Kolodin, "They come to us. We entertain proposals all the time." If a contract would give the company superior market penetration or, if it shows a promising business development scheme, Farmer John officials might consider signing on. But getting into every sporting event in America is not one of the goals. "Its not part of our growth strategy," Kolodin says.
Another company taking advantage of the baseball-hot dog link is ConAgras line of Armour hot dogs, formerly know as "The dog kids love to bite."
The company is now spending millions to establish a link between its hot dogs and Major League Baseball. Marketers are all too aware of the male-dominated portion of sports fans. Armour and other companies have looked beyond the obvious and are now "Trying to appeal to the gatekeeper," of most households cupboards, says Mike Kelly, vice president of Armour and Eckrich brands, produced by ConAgra Foods, Inc., Downers Grove, Ill.
Unlike most sports, says Kelly, the number of women who watch baseball is surprising to many, with as much as 52 percent of the baseball audience on a given Saturday afternoon being female. Marketers figure if they can impress the "gatekeepers" following the sport at home and in the ballpark, they will be sure to grab their products when they are grocery shopping. "From a sports marketing aspect, its the right tie-in," Kelly says. To reach consumers of both genders, Armour has signed seven major league players to their marketing roster, in seven major cities. Unlike in seasons past, this years pitch is designed to transform consumers perception of the hot dogs from being a value-focused product to one known for its quality.
While Armour doesnt sell its products at the ballparks, the company is using baseballs festive atmosphere to increase sales at retail outlets. Since the campaign began this past year, Kelly says sales havent exactly soared, but distribution in retail outlets has gone from 48 percent to 70 percent of U.S. stores. Armour also is featuring the faces of this years "Armour Stars" players on its packages at grocery stores and has produced a commercial featuring all of the stars. The company began running the ads just before Memorial Day and plans to continue placing them throughout the 2001 season.
Cloverdale Meats, based in Mandan, N.D., has seen its products drafted by a major league team. In 1999, when the Seattle Mariners moved into their new stadium, Safeco Field, they also went shopping for new food providers. Scouting reports on the teams former hot dog offering, known as the Kingdog, warranted concession operators decision to deal for an improved product. Many companies solicited bids for the hot dog contract, but for Cloverdale, it was a case of "being at the right place at the right time," says Donna Thronson, marketing manager with Cloverdale, an 87-year-old manufacturer of processed meats. When the decision boiled down to a handful of companies, Mariner officials let their taste buds take over. "Our hot dogs tested very well, and the decision was made to go with us," Thronson says. Following the lead of other ballpark concessions, Thronson says concessionaires at safeco oven-cook their dogs first, then grill them on what she compares to a George Foreman grill, giving fans the look, taste and temperature theyre looking for. Served on a Gais bun, the Mariner Dog is a "far cry from the steamed and foil-wrapped variety because its actually served hot," says Thronson. Vendor fees were set, contracts were signed and voila, the Mariner Dog was born. In its first year at the new venue, sales exceeded 200,000 pounds, which also exceeded expectations. Taking into account the companys expenses and its status as one of the Mariners sponsors, Thronson says the team is breaking even surprisingly early, which came as good news for a venture originally intended to be used solely as a promotional and marketing tool.
Since becoming the hot dog vendor of the Mariners, Cloverdale has seen some peripheral benefits to being a ballpark fixture. While Mariner dogs arent sold in retail outlets per-se, Cloverdale has been granted an endorsement on the label of a Mariner Dog-like retail product. Ideally, Thronson says, the company hoped to be able to put the Mariners logo on the packaging, but instead, had to settle for a label with the phrase, "Served at Safeco Field."
While the retail version of the Mariner Dog might seem a less-glamorous beef hot dog, Thronson says, "Its the same flavor profile, and we use the same ingredients, but it is a different size."
With their products previously limited to Midwestern distribution, getting a foot in the door in the Washington market has allowed Cloverdale to expand in the Northwest.
Already, foodservice tonnage for the Washington market is more than 500,000 pounds, with 200,000 attributed to the Mariner partnership. Thronson says Cloverdale plans to gain even more market share through foodservice venues. "The target goal is to increase tonnage by an additional 100,000 pounds of business into the Washington market," she says.
The experience with the Mariners has been a home run for the Cloverdale
team, and Thronson says future agreements in sports venues have already
begun. "This has opened up a lot of doors for us."