- Nestle is launching a line of boxed mac and cheese called Stouffer's Supreme.
- Shelf-stable mac and cheese is a $2.9 billion category, dominated by Kraft Heinz.
- But Nestle thinks the frozen-food brand can capitalize on its strong name recognition and promises of more cheese sauce.
Stouffer's is exiting the freezer aisle and taking on Kraft Heinz with its new shelf-stable mac and cheese.
The Nestle brand, which celebrated its centennial in June, has spent the past 70 years focused on frozen entrees, such as pizzas, lasagna and macaroni and cheese. But with its strong brand recognition, Stouffer's sees an opportunity to capitalize on the two-thirds of shoppers who buy both its frozen mac and cheese and boxed versions from its rivals, said Tom Moe, president of Nestle Meals Division.
The average American consumer eats mac and cheese 22 times a year, trailing only pizza in its frequency, according to Moe.
Out of those 22 occasions, the mac and cheese comes from a box about 70% of the time. Shelf-stable mac and cheese is a $2.9 billion category, dominated by Kraft.
Mac and cheese represents a roughly $1.7 billion business for Kraft Heinz, the company's Chief Financial Officer Andre Maciel said at the Barclays Global Consumer Staples Conference on Sept. 5. It isn't bulletproof — changes to SNAP food assistance benefits hurt Kraft's mac and cheese sales in the fourth quarter. The food giant responded quickly with a slate of new mac and cheese variety packs and flavors, showing that it is willing to invest to maintain its leadership in the category.
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But Nestle is confident that shoppers trust Stouffer's enough to give the brand a chance.
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"When you want something that's got a rich, supremely cheesy taste, then you'll turn to us," Moe said.
To start, under the name Stouffer's Supreme, the brand will offer two variations on boxed mac and cheese: a classic cheddar and a three-cheese version made with cheddar, gouda and parmesan. Moe said the cheddar is a "sibling, not identical twin" of its frozen mac and cheese, while the three-cheese option is a "cousin."
The pasta is made to be cooked on a stovetop and then mixed with its cheese sauce. Stouffer's says its version has 10% more cheese sauce compared to Kraft's Velveeta.
Stouffer's foray into the pantry aisles is not the only innovation that Nestle is ready to unveil. Moe said his division has a "full suite" of new products hitting the freezer aisle this fall, too.
