Policy Updates

Healthy Choice Offered Frequent-Flyer Miles for Every Ten Bar Codes Mailed In During 1999. A Davis Engineer Bought 12,150 Cups of Its Pudding at 25 Cents Each and Had the Salvation Army Peel Off the Labels.

Healthy Choice was born of a cardiac event. In 1988 Mike Harper, chief executive of ConAgra, had a mild heart attack, and his wife persuaded him to eat food with less salt and less fat. The experience, as the trade press later recorded, led ConAgra to introduce the Healthy Choice brand in 1989. A decade on, the label covered frozen entrées, canned soups, cereal, popcorn, pasta sauce and individual cups of chocolate pudding, and in 1999 the company ran a promotion to sell more of all of it. Every ten Healthy Choice bar codes mailed in by 31 December would earn 500 frequent-flyer miles. Bar codes mailed by the end of May would earn double: 1,000 miles for every ten.

In May 1999 David Phillips, a civil engineer with Facilities Services at the University of California, Davis, was pushing a shopping cart down the frozen-food aisle when the offer on a Healthy Choice entrée caught his eye. Part of his job was monitoring the campus's compliance with the conditions of its environmental permits, which, he told the university's staff newspaper, had left him well-versed in reading the fine print. "I started doing the math," he told the San Francisco Examiner, "and I realized that this was a great deal."

The Math

The entrées cost about $2 each. A few aisles away, Healthy Choice soup was 90 cents a can, and Phillips filled his cart. Then he went to the Grocery Outlet, a warehouse-style discount store, where Healthy Choice chocolate pudding was selling for 25 cents a cup. "And each serving had its own bar code on it," he said. As Time put it, "A mere $62.50 worth, he quickly calculated, would buy 25,000 miles." Phillips described his next step to the magazine: "Being a geeky engineer, I came home and put everything into a spreadsheet."

The spreadsheet answered questions the promotion's designers had presumably not asked. A ticket to Aruba required 300 cups of pudding. A Mercury Villager minivan held 3,456. Phillips cleared out his local store, asked the manager for the addresses of the other Grocery Outlets in the Central Valley, and spent a weekend driving between Davis and Fresno with his mother-in-law riding along, buying every cup he could find. Terry Larson, at the Grocery Outlet in Woodland, told the Sacramento station KCRA that after several rounds of reordering four or five cases, "he kept cleaning us out," and so Larson ordered him a full pallet. In Phillips's own account, posted at the time on the FlyerTalk website, the store eventually special-ordered him 60 more cases of 144.

"My wife thought I was nuts," Phillips told KCRA. "We had a lot of discussions before I took $3,000 out of the bank to buy 12,000 cups of pudding, believe me." The final count, by his own tally, was 12,150 cups for $3,140, along with what KCRA reported as 900 cans of soup. The pudding filled his garage to the rafters, and further cases went in the living room.

The Labels

The pudding was not the difficulty. The difficulty was the deadline. Every cup had to be stripped of its bar code before the end of May, and Phillips and his wife Cindy, a schoolteacher, did most of the peeling themselves until it became clear they could not finish in time. "She got blisters pretty quickly from peeling off the labels," Phillips said, and he promised her a first-class trip to New Zealand by way of compensation. "That was my bribe."

So he trucked the pudding to two local food banks and the Salvation Army, which agreed to remove the bar codes in exchange for the food. In Phillips's account, they pulled the codes off as they served the pudding and kept them for him to post. "We'd never seen anything like it," said Larry Hostetler, community relations director for the Salvation Army in Sacramento. "We've gotten some big donations, but always from companies and institutions, not individual people." The donation also qualified as a charitable gift. Phillips put the write-off at $815, which he said reduced the effective cost of a ticket to Europe to $75.

The Fine Print

Phillips sent the bar codes by registered mail in time for the double-miles deadline and waited. "The promotion specifically said I could get the miles for any Healthy Choice product," he told the Examiner. "But still, it seemed like there was a good chance they'd get me on some technicality." No technicality came. What came, according to his FlyerTalk post, was a form letter from Healthy Choice saying it had no record of his order, even though someone at the company had signed for the package. He had made copies of everything and photographed the haul, and when he sent the proof, the miles followed.

They arrived as 2,506 certificates, each worth 500 miles, for a total of 1,253,000. Of that, 1,215,000 came from pudding and the rest from soup and other products. Because the terms let him post the miles to any airline, Phillips split 216,000 among United, Delta and Northwest and put the remaining 1,037,000 into his American Airlines account, which took him past the million-mile mark and gave him lifetime AAdvantage status. The company, by Snopes's account of the Wall Street Journal's coverage, said the offer had "met and exceeded expectations," though its spokeswoman would not discuss sales figures.

Nobody, it turned out, had lost anything. Bruce Chemel, president of American's frequent-flyer programme, explained the arrangement to Time: "Because we sell the miles." Partner companies such as Healthy Choice paid about two cents a mile, which, the magazine noted, could add up to more than an airline made selling a straight round-trip ticket. Healthy Choice had bought the miles, the airlines had been paid for them, and the pudding had gone to charity.

The Miles

The story reached the Wall Street Journal, the London Times and NBC's Today show. On 26 January 2000 CNN ran the KCRA report, which closed with Phillips's own summary of the lesson: read the fine print. For spring break that year, the family planned to spend their first free tickets on Milan, Barcelona and London. Phillips's daughters, then seven and five, were by his account sick of pudding.

He had already found the next offer. A group of Latin American carriers was running Latin Pass, which awarded a million miles for flying ten of them and meeting several other requirements by 1 July. Phillips did it in two trips over ten days. Time caught up with him after Cindy learned he had been lounging on a beach in Bonaire during a layover while she managed the household, and had grounded him. "I think it's still negotiable," he said. The magazine noted that his job gave him 18 vacation days a year, "and neither pudding nor miles can buy more."

By 2011 Phillips was director of utilities at UC Davis, had visited 40 countries and had accumulated more than six million miles. The pudding miles were all gone. They had paid for, among other trips, first-class flights on British Airways to Mauritius with his wife, and seven free tickets to Playa del Carmen for his family, his parents and his sister. Punch-Drunk Love, starring Adam Sandler, had borrowed the pudding angle. "Companies still make mistakes like this all the time," Phillips said.

Healthy Choice said the promotion had exceeded expectations, and the airlines had been paid two cents a mile. Phillips had his miles and his status, and he had a tax deduction for giving the pudding away. The only complaint on record came from the recipients. After several months of serving chocolate pudding, Hostetler told KCRA, the Salvation Army had started to get questions about "when are we going to get a different flavor."

Filed from public reporting:

Healthy Choice Offered Frequent-Flyer Miles for Every Ten Bar Codes Mailed In During 1999. A Davis Engineer Bought 12,150 Cups of Its Pudding at 25 Cents Each and Had the Salvation Army Peel Off the Labels.

The Math

The Labels

The Fine Print

The Miles

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