H.J. Heinz Co raised its 2010 earnings forecast, helped by strength in emerging markets, while U.S. foodmaker Campbell Soup Co cut its sales forecast as frugal U.S. consumers shunned ready-to-eat soup.

Campbell also led many analysts to believe it will turn to margin sapping discounts and price promotions to jump-start volume in ready-to-eat soup.

Ketchup maker Heinz said late last year it had started targeted promotions to drive consumption in certain markets, and it saw volume increase four percent in its third quarter in the United States.

But it also said earnings for the third quarter ended January 27 should be about 82 cents per share from continuing operations. Analysts, on average, have expected 71 cents per share, according to Thomson Reuters I/B/E/S.

We had initially feared that the (promotional) investment may buffet margins, but third-quarter results now alleviate these fears, J.P. Morgan analyst Terry Bivens said in a research note.

Volume, a measure of food shipped to retailers, also rose 9 percent in the United Kingdom, Heinz said.

Many packaged foods companies have benefited as consumers try to save money by eating at home more often. But shoppers are more selective about what they spend money on and ready-to-eat soup has not been enough of an attraction, even during a particularly cold U.S. winter.

Shoppers have become increasingly price-sensitive, Campbell CEO Douglas Conant said in a presentation to the Consumer Analyst Group of New York.

Manufacturers are finding it more necessary to balance between providing discounts and other deals to attract consumers without desperately cutting into margins.

They have had some room to maneuver in higher marketing due to falling commodity prices and cost-cutting efforts. But with costs for some commodities expected to rise this year, those discounts may be harder to pull off.

With a mature U.S. market, companies are looking more and more to emerging markets in Asia, Latin America and eastern Europe to find new areas to increase sales.

Heinz has been active in emerging markets like China and Russia for years and has made growth in that arena a priority as incomes rise and consumers buy more packaged goods.

Emerging markets represent a target-rich base of consumers who are likely to spend more and more of their income on branded packaged foods as they prosper, Heinz CEO William Johnson said.

The company is on track to have at least 20 percent of its total sales in emerging markets by 2013, Heinz said. It is also planning to launch Heinz infant formula in Russia and China, Johnson said.

Campbell, meanwhile, has only recently begun selling soup in China and Russia and expects investment in those regions to cut into earnings for the next three years.

Campbell expects sales to rise only 2.5 percent to 3.5 percent in 2010, down from a prior forecast of 4 percent to 5 percent. The average Wall Street growth forecast was 3.8 percent, according to Thomson Reuters I/B/E/S.

But it backed its 2010 net earnings per share growth outlook of 9 percent to 11 percent from fiscal 2009 adjusted earnings of $2.21. The average Reuters earnings growth estimate was about 11 percent.

Heinz raised its full-year profit forecast to $2.82 to $2.85 a share from its previous forecast of $2.72 to $2.82. Analysts on average forecast $2.82, according to Thomson Reuters I/B/E/S.

Shares in Campbell closed 3 cents higher at $33.62 on Wednesday. Heinz gained 1 percent to $45.02 and rose an additional 1 percent after-hours.

(Reporting by Brad Dorfman; Editing by Bernard Orr)