• Ad Age, Wednesday, March 21, 2007 2:21 PM

The recall of 60 million cans and pouches of wet pet food sold under more than 80 brands is revealing the industry's well-guarded secrets: Some of the premium pet-food brands in the U.S. use the same manufacturer that processes dozens of low-priced private-label products.

Though the formulations may be different, canned or pouch pet food for Procter & Gamble Co.'s Iams and Eukanuba, Colgate-Palmolive Co.'s Science Diet and Nestle Purina's Mighty Dog brands have been caught up in the same recall by processor Menu Foods as private labels for retailers such as Wal-Mart Stores, Food Lion and Meijer.

"This whole scandal can dismantle the pricing architecture for branded products when consumers see that branded is essentially the same stuff with a higher price point," says Burt Flickinger, principal with the consulting firm Strategic Resource Group. But Laura Ries, president of marketing consultancy Ries & Ries, says most consumers "want to believe in brands" and will give the benefit of doubt to expensive labels like Eukanuba.

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