Coming across a bag of Rachel's potato chips last weekend was like finding an old friend: Naming biases aside, I think the chips--one of the first "gourmet" potato chip brands--are a great product. Though somehow I couldn't remember the last time I'd had a bag: Was it back when Northwest Airlines used to pass 'em out with in-flight meals?
Rachel's may be best known for the exposure it received in 1998 when it was a tiny, Bloomington-based mom-and-pop operation. Two weeks before the Indianapolis 500, owner Jim Garlie decided to sponsor a team of racers--one of whom, an aging long-shot named Eddie Cheever, won the grand prize.[jump]
From Business Week:
...The chief sponsor of Cheever's Indy car, Rachel's Gourmet Potato Chips, has already bagged considerable benefits by taking a chance on a new owner-driver in an upstart racing league. A previous sponsor had jumped ship, and the Minneapolis-based snack food maker signed on just 10 days before the big race. To bring Rachel's on board, Cheever had to execute some flashy maneuvers. First, he persuaded an associate sponsor, Midwestern hardware chain magnate John Menard, to carry Rachel's at his 138 Menards stores. That virtually guaranteed Rachel's sponsorship investment would be covered before a single race was run.
The Indy win turned out to be a delightful double-dip for Rachel's. National print and TV coverage provided exposure worth $6 million to $8 million to those with their brands on the victor's car, according to Ann Arbor (Mich.) marketing researcher Joyce Julius & Associates. ''Since Indy, our phones have been ringing off the hook. Our chip sales have doubled,'' says James M. Garlie, president of RLD Enterprises Inc., parent of Rachel's brand. Garlie has also cashed in on Team Cheever's success by expanding his marketing to the 10 cities where the racers compete.
The company was later sold to a surprisingly large snack-maker, KLM Enterprises, based in tiny Perham, MN, that also makes Barrel O'Fun, and the Rachel's line has subsequently expanded to include healthier offerings such as puffed multi-grain snacks. Thanks, but I'll stick with the kettle chips.