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Perishable Pundit
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Produce Business

Deli Business

American Food & Ag Exporter

Cheese Connoisseur

What Consumers Really Want

Hat tip to Lee Smith of DELI BUSINESS for passing on this release from The Natural Marketing Institute, which reports its finding that three quarters of consumers are concerned about their energy level. My first response: only 75%? I don’t know anyone who wouldn’t like a little more energy.

The implications of this are significant. The release speaks to product development such as low-sugar and sugar-free foods and, more broadly, of the opportunity to tie in to the idea of “Stable” energy and low- glycemic foods.

The release, though, also stands as a critique of the marketing in every perishable department in the store. In meat, poultry, seafood, deli, dairy, produce, even in bakery and floral — the typical marketing is limited to description: “We have salmon or ham or lamb chops or roses.” If we are fancy, we have Wild Alaskan salmon or New Zealand lamb chops. Once in a while, you will see more elaborate description: High in anti-oxidants, fresh or on sale. Even organic is still a description.

It is as if we all forgot Marketing 101: sell benefits, not features.

A consultant in the publishing field was critiquing some promotional copy for a Feng Shui book. He pointed out that the promo read: "Have you ever asked yourself, ’Why can’t there be a simple, easy-to-understand guide to Feng Shui’?"

But the consultant pointed out: This likely isn’t what the reader is asking himself. What the reader has asked himself — and would have a stronger reaction to in a subhead — is "Why can’t I get rich?" and "How can I stay healthy?"

In other words, all marketers need to determine what the real motivation is for people to purchase a product. That is what we need to be thinking of and that should shape how we position products.

The floral arrangement should probably say: “It will win her heart,” not “a mixed flower bouquet.” The children’s birthday cake with the cartoon character should be promoted as something that will “Thrill your little boy when he sees his favorite cartoon friends.”

Look at Abraham Maslow’s heirachy of needs and see what the consumer really wants from your product:

Return Of The Automat

“To have your own stack of nickels placed in your tiny hands; to be able to choose your own food, richly on display like museum pieces; to make quick and final decisions at the age of eight; this was a lesson in financial dealings that not even two years at the Wharton School could buy today.”

— Neil Simon

Long before anyone thought of shopping over the Internet, Horn & Hardart was advertising food as “Quick as a Click.” Now a restaurant named Bamn! is due to open as an Automat in New York. The last automat in New York closed in 1991, and I had the pleasure of eating there the day before it closed. But it was already well past its prime, and I never new the excitement that led the concept to be part of the popular culture — the automat that Irving Berlin wrote about, that actors and actresses used to frequent ― that was gone by the time I was born. Though when my parents took me just once to experience the last standing automat at 3rd Avenue and 42nd Street, I do remember as a boy feeling some of the thrill and excitement that Neil Simon describes above.

Some of the early planning meetings to launch PRODUCE BUSINESS were held in an art deco deli on 57th Street and 6th Ave. It was a former automat (shown above) and the building was beautiful. Now it is being torn down to be replaced by a Hilton Vacation Club.

There have always been some automats in the Netherlands, and Japan has an enormous amount of vending machines. But the automat was in-sync with the times, its self-serve vending machine bespeaking a faith in technology as the path to a better tomorrow.

In its time, Horn & Hardart was famous for coffee. And now they sell franchises.

Recently in the Pundit, I recommended overseas travel as a path to competitive advantage. It worked for Messers Horn and Hardart. Frank Hardart was inspired on a trip to Berlin where he saw the Quisiana Automat. They bought the German equipment and opened their first Automat in Philadelphia in 1912. The rest was history. You can buy the book here.


Doubtful Immigration Policy

Immigration is a crucial issue to business in general and the food industry in particular. The big growth in foodservice probably wouldn’t be possible without substantial immigration to provide staffing for all those restaurants. And it is said that no industry is as dependent on illegal immigrants as the business of harvesting produce.

There are important philosophical issues at play about what kind of country we want to be and what our obligations are to people who are not part of our country.

There are economic divides between those who focus on building the overall strength of our economy and those who focus on raising wages for specific sub-groups.

There also is a real struggle over how we make immigration compatible with our national security interests in an age of terrorism.

Yet I would say the biggest obstacle to actually passing legislation is the total breakdown of trust that the government will enforce any law that is passed.

Look at how this just stops discussion in its tracks: The produce industry has been pushing for a guest worker program. It is an attempt at compromise between those who want to restrict immigration severely and those who want more open borders.

Guest worker programs have been proven to have many issues. But it is only a compromise at all if those who favor restricting immigration perceive that the guest workers will, in fact, leave the country when the program is done.

And here, our current policies leave more than reasonable doubt on that fact.

A lot of attention has been paid to “protecting our borders” and, indeed, there is a big problem with illegal immigration from Mexico.

But that is not the half of it; you don’t have to be an expert in immigration to know that we have tremendous issue in terms of legal immigrants that overstay their visas.

Many a person could name ten housekeepers or nannies who have overstayed their visas and, in fact, the Department of Homeland Security estimates that people who have overstayed their visas account for one-third of the seven million illegal aliens in the U.S. as of January 2000. And surely if they ever actually secured the border with Mexico so people couldn’t enter illegally, that number of overstays would zoom.

The bottom line is that, right now, nothing happens when an individual overstays his or her visa. No “All Points Bulletin” is issued because someone had a six-month tourist or educational visa and doesn’t show up to leave the country.

What possible reason is there to think that if someone working on a guest worker program doesn’t show up to leave the country that the FBI will hunt him down?

And as long as that trust is not there, it is very hard to get anything enacted.

Seafood Prize Goes To Florida Chef

At the recently held Great American Seafood Cook Off in New Orleans, the winner was Chef Justin Timineri, Executive Chef of the Florida Department of Agriculture, who worked with Chef Joshua Butler, Chef for the Governor of Florida. The winning dish, which the Pundit vows to prepare knowing that Mrs. Pundit will be more than suitably impressed, was built around Florida snapper, shrimp, tropical fruits and citrus. You can read about the winning chefs and get their recipes here.

Now you may not have known (which is a clever way of saying that the Pundit didn’t know) that the Florida Department of Agriculture had an Executive Chef. But, this guy does great stuff. The department describes his job this way:

“As Executive Chef for the Department’s Division of Marketing and Development, Justin’s responsibilities include promoting all of Florida’s agricultural products, creating new recipes, attending trade events, performing cooking demonstrations and educating children on the value of health and nutrition in food.”

So, for example, earlier this year he was in the United Kingdom as part of the Fresh from Florida, Florida Agricultural Promotional Campaign. He did demonstrations in the flagship stores of the Waitrose chain to promote Florida grapefruit, sweet corn and blueberries. It was a follow-up, building on the success of a program confined to sweet corn, which was done in 2005. The Perishable Pundit’s sister publication, AMERICAN FOOD AND AG EXPORTER, profiled that effort here.

There is some controversy over the degree to which many of the various state promotional programs increase total demand, as opposed to re-shuffeling it toward the more active promoters. But foreign promotions, which often involve introducing consumers to new products, are often a big win. For example, the article in AMERICAN FOOD AND AG EXPORTER explains what was experienced at the promotional effort in Britain:

“…only three out of 30 people at a recent demonstration had ever tried sweet corn. When we introduced children’s workshops into our demonstrations, we found that no child present had tried blueberries.”

What opportunities the world presents to expand business. But Americans are blessed with a large and rich domestic market and so are generally lazy exporters. There are exceptions, of course, with some firms highly dedicated to the pursuit of business overseas.

By and large, though, most producers of agricultural marketers see export as a place to turn when the domestic market is saturated. They forget all about their customers overseas when the domestic market turns around. That is no way to build a business.

WIC Juggling Act

There is nothing more painful in politics than a zero-sum game. The perishable food industry finds itself creating crossfire over the Special Supplemental Nutrition Program for Women, Infants and Children, or WIC for short.

For some time now, the produce industry has lobbied to see fruits and vegetables included in the national program. Now the USDA has proposed substantial changes to the program, particularly the addition of whole grains and fruits and vegetables. The United Fresh Fruit and Vegetable Association expressed agreement, and the Produce Marketing Association expressed its praise for the decision.

However, Congress isn’t allocating any more money for WIC, so this gain for produce and whole grains, plus some for canned fish and some ethnic foods, has to come out of someone else’s federal dollars. The dairy industry will get hurt, so the International Dairy Foods Association and the National Milk Producers Federation jointly expressed their concern. The egg industry will also be cut back, so the American Egg Board responded negatively. Juice is being cut back as well, but the juice association must have not had my e-mail. You can be sure they don’t like it either.

The USDA has made the only possible call, but it is easy to understand why the dairy and egg folks and the juice folks are upset.

The proposed changes roughly follow the recommendations made by the Institute of Medicine, one of the national academies that advise the nation on science, engineering and medicine. It also brings the WIC program into closer accordance with the current dietary recommendations.

However, the WIC program gives vouchers worth about $35 per month. So it is not as if anyone was getting such an overdose of anything before the changes. And there are always arguments to be made. According to Welch’s spokesperson, Jim Callahan, “Allowing more juice would help ensure kids are getting the vitamin C they need and discourage kids from drinking soda or other sweetened drinks.”

In truth, the fight may give each association the opportunity to earn some credit with its members for fighting the good fight, and it is a triumph for good government to have whatever money is there to be allocated based on science, not politics or tradition.

But money is a fungible commodity, and most families supplement the WIC allotments for food with their own cash. So the net result of a change in the WIC program is likely to be a re-shuffling of which items are purchased with WIC funds and which are purchased with cash.

There will not likely be any substantial change in sales of any food items, only a change in how those items are paid for.

The biggest nutritional change may actually come about in the requirement for whole grain cereals. This is a category that many WIC mothers weren’t buying at all, and so the change may create substantial increases in whole grain cereal purchases.

That’s A Wrap

A very special thank you to everyone for sharing some of your really valuable time with Jim Prevor’s Perishable Pundit during our launch week.

I head into our first weekend invigorated with the advice and well wishes of the many of you who took the moment to send me e-mails. Thank you. Plus, our first week isn’t even over and business people from over 40 countries are already regular readers. That is pretty amazing. And we have a lot more great things coming up ahead.

A reminder to everyone to please subscribe so you will get every edition. You can always click the subscribe button on the side of the page or you can subscribe right here.

Have a great weekend. I look forward to chatting with you on Monday.

— Jim

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