Chattanooga Bakery, Inc.

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Chattanooga Bakery, Inc.

900 Manufacturers Road
Chattanooga, Tennessee 37405
U.S.A.
Telephone: (423) 267-3351
Fax: (423) 266-2169
Web site: http://www.moonpie.com

Private Company
Incorporated: 1902
Employees: 150
Sales: $39 million (2004 est.)
NAIC: 311330 Confectionery Manufacturing from Purchased Chocolate; 311423 Dried and Dehydrated Food Manufacturing; 311821 Cookie and Cracker Manufacturing

Chattanooga Bakery, Inc., is the company behind the South’s most famous of snacks, the MoonPie. This marshmallow and cookie sandwich grew to such prominence as an inexpensive treat that it was celebrated in songs, books, and even a festival or two. Owned by the Campbell family for generations, the company has produced billions of MoonPies over the years. Along the way, Chattanooga Bakery has overcome technical hurdles such as extending shelf life, developing a new product for vending machines, and automating production to keep up with mass market demand. A million MoonPies are made every day. The company has extended the appeal of the classic treat with new coating flavors beyond the original chocolate (which is still by far the most popular flavor) and new sizes. Recognizing the value of its nostalgic brand, it has also licensed the production of MoonPie-themed merchandise.

MADE FOR MINERS

Chattanooga Bakery was formed in Tennessee at the beginning of the 20th century. It was originally a unit of the Mountain City Flour Mill and industriously developed dozens of products using excess flour from its parent company. These included ginger snaps, lemon cookies, and sugar cookies.

It was a single product, or family of products, however, that lifted the firm to regional, national, and international acclaim. This was the famous MoonPie, the chocolate-coated marshmallow and cookie snack that has become a southern culinary icon.

The MoonPie is a good example of consumer-driven marketing. While servicing his route in the Appalachians, sales representative Earl Mitchell, Sr., learned that coal miners there wanted something more substantial than available cookies to tide them over between meals. According to legend, one said the new snack should be as big as the rising moon.

The answer developed at the bakery was the Moon-Pie: two soft four-inch graham cookies with a layer of marshmallow between, and dipped in chocolate. The sweet sandwich, priced at just five cents, was an instant success. The chocolate-covered confection had a longer shelf life than most bakery products, allowing it to be distributed regionally. An exodus of workers from the South during World War II brought MoonPies to northern industrial centers such as Chicago.

Sam Campbell, Jr., had bought into Chattanooga Bakery in the 1930s after the death of his father, the bakery’s original president. The firm would remain in the hands of his family throughout the rest of the century.

“GIVE ME AN RC COLA AND A MOON PIE”

The MoonPie would soon reach unprecedented heights in popularity, especially when paired with another popular product. A relatively large snack for five cents, the MoonPie was one of the better bargains to be had at markets, as was the bottled beverage RC cola, which came in larger containers than other sodas for the same five cents. So for ten cents, a MoonPie and an RC made a popular “workingman’s lunch.” This combination was even immortalized in a country song by Lonzo and Oscar, “Give Me an RC Cola and a Moon Pie” in 1951.

The Chattanooga Bakery was making a few other items in the 1950s, including vanilla wafers, club crackers, gingersnaps, and graham crackers. By this time, the MoonPie’s success had spawned several imitators, but many of these other brands were manufactured at the Chattanooga Bakery plant anyway. The bakery’s success in formulating a product with superior shelf life (eventually extended to four months), helped it emerge victorious over other competitors such as the Scooter Pie, Wagon Wheel, and Whoopie Pie.

The company looked next to improve on the enduring classic. In the 1960s, a new variety with a second layer of graham cookie and marshmallow was added to the original recipe to form the Double Decker MoonPie. This was developed to meet a demand for a product thick enough to be dispensed in the new generation of vending machines. The new MoonPie weighed three ounces more, allowing the company to reasonably raise its price to a dime, which in turn allowed it to raise margins at a critical time while still delivering a good value to the consumer. Within a few years, the Double Decker was making up half of all sales.

By the end of the decade, MoonPies had become one of the most popular prizes thrown to revelers in Mobile, Alabama’s Mardi Gras celebrations. The soft, round disks were less dangerous projectiles than the boxes of Cracker Jacks they had supplanted.

A SUPERSTORE FAVORITE

In the early 1980s, Chattanooga Bakery relocated from its original site downtown to a location by the Tennessee River. The new plant was soon making more than 300,000 MoonPies every day. The spread of microwave ovens in the 1980s energized MoonPie fans with the enhanced taste sensation of gooier marshmallow and molten chocolate.

Around the same time, the company was making inroads with the world’s largest retailer. Wal-Mart buyers agreed to stock MoonPies in the late 1980s but offered the product to store shoppers on a rotating basis: sometimes the stores had MoonPies on their shelves; other times they did not. This was frustrating for Chattanooga Bakery and frustrating for store managers, particularly in the South, where customers would complain about the sporadic supply. Known for visiting stores personally and listening to his employees and customers, Sam Walton got wind of the situation and stepped in personally, ensuring placement of MoonPies throughout his stores on a regular basis. This naturally led to orders of unprecedented scale. Another important relationship, according to MoonPie historian David Magee in his MoonPie: Biography of an Out-of-This-World Snack, was with the Cracker Barrel Old Country Store, a 500-unit chain of restaurants and nostalgic gift stores. The company began supplying Cracker Barrel with MoonPies in special nostalgic packaging that would catch the eye of customers in the old-fashioned general store atmosphere of Cracker Barrel.

By 1992, distribution had spread to Japan, where the treats were called Massi Pies (from the Japanese for marshmallow). The snack was still popular on its home turf. In the mid-1990s, the small town of Bell Buckle, Tennessee, put together a festival dedicated to celebrate the classic pairing of MoonPie and RC Cola. Events included a MoonPie toss. A decade earlier, the town of Oneonta, Alabama, had launched a MoonPie-eating contest after a local store accidentally ordered too many.

COMPANY PERSPECTIVES

Nope, contrary to conspiracy opinion, MoonPies didn’t fall from the sky. Made in the USA for over 75 years, the MoonPie has a sweet history.

MODERN MARKETING AND PRODUCTION

Chattanooga Bakery revamped the MoonPie’s packaging in 1998. Its tagline was “The only one on the planet.” By this time additional coating flavors had been introduced, including banana, vanilla, and the seasonal variations lemon and cherry. The late 1990s also saw the introduction of a smaller version of the MoonPie called the Mini. These were packaged in boxes of six or 12 and intended for lunch boxes and other situations requiring a less substantial snack than the original.

The bakery was also promoting the items with such initiatives as free NASCAR trading cards. The MoonPie Rookie Dash for Cash awarded rookie drivers cash prizes for winning certain races, and consumers could also vie for cash by entering a drawing.

The process of modernizing the production line resulted in delayed shipments and tried customers’ patience, reported Magee. These were eventually sorted out, allowing production to reach new heights.

The humble, whimsical MoonPie captured the imagination of a number of authors over the years. In 2000 the Chattanooga Bakery helped promote a children’s book inspired by the treat (Jimmy Zangwow’s Out-of-This-World Moon-Pie Adventure ) by including its artwork on the MoonPie’s packaging.

Vanilla Raspberry Full Moons were introduced in 2001, featuring Smucker’s fruit filling next to the marshmallow inside the sandwich. Other fruit-filled sensations in the Full Moon line followed, such as apple-cinnamon.

Promotional efforts included a link with another Tennessee institution, the Grand Ole Opry; single-serve MoonPies were baited with entry forms for a chance to win a trip to Nashville. MoonPie’s sponsorship of a Casting Call for the Outdoor Life Network helped it connect it with outdoorsmen, a key demographic for the brand.

In 2001 the MoonPie had estimated sales of $20 million, a record, according to the Associated Press. It was a recession-proof snack, explained company president Sam Campbell IV. Chattanooga Bakery maintained a workforce of about 150 at this time.

CELEBRATING 100 YEARS

A line of branded merchandise appeared in 2002, the year of Chattanooga Bakery’s 100th anniversary. These products included children’s apparel, linens, and kitchen items. The Mayfield Dairy of Athens, Tennessee, produced a special MoonPie-flavored ice cream to celebrate the centennial. In other efforts, 15,000 people sent Chattanooga Bakery their “MoonPie Memories,” which would form the basis of a book.

In 2005, Chattanooga Bakery experimented with its first ever television advertising campaign, which aired in Birmingham, Alabama, and Charlotte, North Carolina. Still, the enduring success of the product, a cultural phenomenon, was built with hardly any promotion at all.

Frederick C. Ingram

PRINCIPAL COMPETITORS

Interstate Bakeries Corporation; McKee Foods Corporation; Nabisco Biscuit Co.

KEY DATES

1902:: Chattanooga Bakery is formed by Mountain City Flour Mill.
1917:: The first MoonPie is created as a snack for hungry coal miners.
1951:: “Give Me an RC Cola and a Moon Pie” is a hit country song by Lonzo and Oscar.
1983:: Chattanooga Bakery relocates to a larger plant.
2001:: Company reports record sales of $20 million on eve of 100th anniversary.
2005:: The MoonPie’s first television ads appear in a couple of key markets.