Pirate's Booty :::snack fight!

	The snack food market is one of almost limitless opportunity combined with unequalled competition. While it is dominated by such food giants as Frito-Lay (PepsiCo) and Nabisco (Kraft), the industry just as readily supports smaller companies.

One of those companies is Robert’s American Gourmet, maker of the somewhat notorious Pirate’s Booty brand. Pirate’s Booty is a quirky little brand with a backstory that reads like the American dream. Robert Ehrlich was a commodity trader who founded Robert’s American Gourmet in 1986 with the intention of creating “American” salad dressings. But he quickly gained a passion for developing healthy snacks. “I first got the idea for Pirate’s Booty while watching the pirate ship at Treasure Island,” Ehrlich says on his website. “Pirate’s Booty was initially named Pirate’s Treasure. The name didn’t matter—people just loved our air-puffed rice and corn with aged white cheddar.” Well actually, the name did matter, at least in terms of brand recognition. What Ehrlich did was differentiate the brand from the competition with a memorable identity—a unique name accompanied by a cartoon of a pirate character, drawn in a humorous rather than threatening way. Of course, it didn’t hurt that Pirate’s Booty was also a healthy, natural snack food. It had the kind of unique appeal that crossed over from parents to their kids. When Pirate’s Booty came to market in the mid-1980s, snack food companies were just beginning to discover natural, healthy snacks. Most competitors were using packaging that had the natural, healthy, nutritious, good-for-you, serious look. Only a few, such as Smartfood Popcorn, broke the brand mold. Smartfood launched its product in a reclosable black bag—highly unusual for a snack food. Frito-Lay purchased the company in 1989, but the black bag remains its signature. Pirate’s Booty ventured to the other side of the creative spectrum, employing a package that featured the cartoon pirate and an old-fashioned typeface set against a colorful background. As the product line expanded, color was used to differentiate brands and line extensions; for example, green is used for Veggie Booty, red signifies Pirate’s Cannon Balls and purple represents Smart Puffs. The pirate became one of numerous cartoon brand mascots used on Robert’s American Gourmet products. The model for the pirate was Ehrlich himself, while his father inspired the character on the Smart Puffs bag. It’s all part of a look and feel that is fun and a bit off-center. Jim Hardison, a creative director at San Francisco design agency Character, says, “These are characters who refused to accept the standard way of doing things, either by pioneering revolutionary approaches or by living outside the normal rules of society” (“Ay, Matey, Pirate’s Booty Hopes Mascot Sells Snacks,” FSB Magazine, October 2006). Pirate’s Booty is the flagship product of a company that generates some US $50 million in annual sales. Robert’s plays in a natural snacks segment in the United States that is a US $2 billion-a-year business, growing at over 15 percent per year, according to Kara Cissell-Roell, managing director of VMG Partners. A private equity firm, VMG invested in Robert’s American Gourmet in November 2008. Today Robert’s sells Pirate’s Booty and its other snack foods in all 50 states, as well as in Canada, Europe and Asia. Robert’s American Gourmet has had a few stumbles along the way. The company has been criticized in the past for misrepresenting the fat content in some of its products. In 2007, Robert’s was forced to recall Veggie Booty and Super Veggie Tings Crunchy Corn Sticks because of salmonella contamination. In recent years, Robert’s has significantly reduced its snack offerings from over 50 products to less than ten. And it’s anybody’s guess if events surrounding Somalian pirate attacks will help or hurt the image of Pirate’s Booty. But Pirate’s Booty has survived these challenges, and its popularity has apparently not diminished. Journalist Rob Walker, author of the book Buying In, says Ehrlich told him his company overcame past adversity because “it reacted quickly and openly” to problems such as the salmonella contamination. “He [Ehrlich] also notes that the company had long-established goodwill with its customers—it’s been around since 1986—drawn to its ‘authenticity’” (“Snack Mentality,” The New York Times, June 29, 2008). The company’s new challenge will be growing beyond its niche product status. While Pirate’s Booty and its companion brands have maintained their appeal to loyal customers, the brands now increasingly face look-alike competition. Small and large companies alike have Pirate’s Booty in their sights, and they are anxious to eat into the multibillion-dollar healthy snack food market. Despite the global recession, snack foods are doing well because people turn to them for comfort, even when they are pulling back on spending. Foods like chocolate, chips, cookies and other snacks give consumers a quick burst of energy and make them feel good, if only for a fleeting moment. If snack foods are healthy, so much the better. Yet the question remains: Will consumers continue to treasure Pirate’s Booty?