Fewer Oreos, More Profit

It’s always good that Foodie Friday follows my shopping day, which is Thursday (gotta get that senior discount – Thursday only!). If you aren’t the primary shopper in your house and you haven’t been to a grocery store lately, you probably haven’t noticed that the shelves are less-full than usual. It’s not just the meat case (you’ve probably heard about the issues with meatpacking plants during the pandemic) or the toilet paper aisles that are on the empty side either. I’ve noticed lots of gaps.

It turns out that while it’s due to the current crisis, it might not be for the reasons you think. As CNN reported:

It’s also because major food companies — the ones that make our cookies, chips, and canned soups — have been paring down their product offerings. When stay-at-home orders went into effect this spring, Mondelez, General Mills, PepsiCo, J.M. Smucker, Campbell, Coca-Cola, and others saw a massive spike in demand for some products. To help meet that increase, they sped up production lines on their most popular items -— and that meant cutting back on more fringe offerings. That translates to fewer varieties of Jif peanut butter, Oreo cookies, and Frito-Lay chips at the store.

In other words, they reverted to the Pareto Principle and focused on the items that brought them the most revenue and profits and didn’t worry much about line extensions or the varieties that filled the shelves but not the corporate pockets, at least not as much as the main lines do.

Restaurants are doing much the same thing. Many places have trimmed their menus way back to focus on the most popular and profitable items. For example, Dave & Buster’s reduced its 40-item menu to 15 offerings and McDonald’s has cut salads, bagels, yogurt parfaits, and all-day breakfast during the crisis. IHOP used to have a 12-page menu. Now it’s giving guests a 2-page, disposable menu. This should improve economies of scale, simplify ordering supplies, make it easier on the staff, etc. 

Less can be more and the exercise that these businesses have conducted to deal with a crisis is something that your business might consider as well. What services are you providing that are less attractive or less profitable? Is your product line overextended? Is it better to focus on the more profitable sectors even if it costs you a few customers? Something to think about this weekend!

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Filed under food, Helpful Hints

A Little More Privacy

Sometimes I feel that I use this space to relay only bad news. I rage about lousy customer service and vent about idiocy in marketing. Well, not today. Nope. I have some good news, at least from a consumer perspective. Frankly, from a marketer and application developer perspective, it sucks, but that’s life, I guess.

Apple released the details about the latest version of iOS yesterday. I’m not an Apple fanboy and I don’t own an iPhone. However, I think this announcement is a big step forward in many ways. You see, this new version of iOS will offer new privacy features, including one that could make it harder for ad-tech companies to track users.

When an app that’s installed on the phone wants to track them for ad purposes, the phone will let the user know and will ask people to either allow or prohibit tracking by that app. If you choose not to have an app track you, the system won’t let the app grab the identifier for advertising (IDFA) — an alphanumeric string that allows developers to track mobile users across different apps. My Android phone has something similar but it’s really a binary yes/no choice for all apps and not set at the app level. What Apple is doing is a step forward in improving our privacy.

Needless to say, the Network Advertising Initiative criticized Apple’s move. They say that it will make life harder for app developers since it will be harder to make money via ads. They say this could lead to developers having to charge for apps or for in-app content. I realize I might not be typical, but I do pay for apps that I find useful, especially if that removes the advertising. A few bucks a year for something I regularly use is, in my way of thinking, a fair exchange of value. Tracking me without my permission and selling the data is not.

Apple did something similar to this in their Safari browser a year ago. You would expect Apple to lead the change on privacy with respect to ads because unlike Google or Microsoft, their business isn’t based in the advertising world.  Their hardware isn’t a secondary line as it is with others. Is this going to have others doing the same? Maybe not, but since third-party cookies have disappeared and now tracking is more difficult on a significant portion of the installed mobile base, other changes in how privacy in the ad business works are sure to follow. Stay tuned!

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Filed under digital media, What's Going On

Egg Creams

Foodie Friday! Unless you grew up in the New York area, you probably have no idea what an egg cream is. I suspect you might even have to be of a certain age to know. No, it has nothing to do with those eggs Cadbury sells. It’s a beverage, one that was a real treat when I was a kid. Here’s the thing: it contains neither eggs nor cream.

An egg cream is basically a glass of chocolate milk with some carbonation added via seltzer. Of course, a REAL egg cream is made only with Fox’s U-Bet chocolate syrup, whole milk, and a good spritz out of a blue seltzer bottle to froth the whole thing properly. Good luck finding one of those bottles any more!

The egg cream actually has its own day – March 15. Its origins are shrouded in mystery and it seems as if every soda jerk in NYC had his or her own closely-guarded recipe (proportion is everything!). The most interesting thing about it to most people is that it’s not at all what one would think it is, which leads to our business point today.

One thing that’s essential to any successful business (or businessperson) is authenticity. Their purpose is clear, they operate under a set of values that everyone involved knows and adheres to, and they have a defined personality. You can call it a brand image but I think it goes deeper than that. Apple, Disney, and others are great examples of this. As Dennis Green famously said, “they are who we thought they were.” Unlike the egg cream, the image you have about them is probably spot on to reality.

None of us can afford to be egg creams. We need to be clear about our personal and business brands. We need to project an image that rings true. I hope that makes sense. Now if I could only find a way to get a full, traditional seltzer bottle here from NYC without spending $100!

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Filed under food, Reality checks