Frito-Lay Stymied by Healthy Snack Biz

Though PepsiCo has been one of the most innovative mainstream CPG companies in the industry’s drive to provide better-for-you products, the company has come up against at least a couple of major frustrations in at least one segment of the growing healthful-foods genre: salty snacks.

Frito-Lay has been a leader in terms of substituting “good” cooking oils for bad, for instance, and in introducing lower-calorie baked varieties of its Lays potato chips and other brands. It also has succeeded by acquiring startup healthy-snack brands such as Stacy’s pita chips.

But when Frito-Lay initiates a better-for-you brand, watch out.

The company went far out on a limb several years ago with products based on olestra, a substance that blocked fat absorption, for example. But the olestra initiative was soon abandoned because of digestive side effects in some consumers from the active ingredient.

And now Frito-Lay is giving up on one of its boldest better-for-you snack gambits yet: True North.

Frito-Lay launched the line of premium nut products in 2007, but True North never caught on with health-conscious consumers — even though most nuts are intrinsically healthy, a prime advantage for marketing.

And now Frito-Lay has bailed on the brand, selling it to DeMet’s Candy, a Stamford, Conn.-based company that owns Turtles, Stixx and other candy brands.

The lazy performance of True North follows Frito-Lay’s disappointments with its Flat Earth brand of vegetable chips, which so far it has retained. The PepsiCo division has tried eliminating Flat Earth’s original fruit-based SKUs, tweaking the packaging, and testing other brand tweaks to goose Flat Earth’s sales – but largely to no avail.

The Flat Earth logo is a flying pig – implying that it was impossible to imagine a snack that was so tasteful and yet better-for-you, provided by a company as mainstream as Frito-Lay. But last time we checked, pigs are still earthbound.