In today’s newsletter:
Where’s the Beef? Putting Back in What Industrialization Removed
At What Cost? How cost optimization can backfire
Thinking Forward and Back: Another way in to nostalgia
Tidbits: Quick links to fun food news
Did you miss last newsletter? Find it here
Can Impossible Out Beef, Beef?
Impossible is introducing a new burger to its line with the launch of Indulgent Burger Patties. The 1/3 lb. patties are advertised as being “beefier, thicker, and juicier.” The company plans on first rolling the burgers out at select restaurants (like Bareburger and Monty’s Good Burger) before they make their way into retailers.
So What? Even before Reddit dominated the news, I’ve been a fan. While it has dark side-streets, I like it because it provides an unedited peek at normal people that’s not as performative as the rest social media.
For years, I’ve followed the subreddits r/Cooking and r/AskCulinary, places where everyday cooks ask the Reddit community about ‘all things food.’ A common complaint you’ll see in these subreddits is that modern meat and poultry just isn’t very good. People criticize and lament the poor texture and lack of flavor in supermarket chicken, ask how to make supermarket ground beef “taste like something,” and marvel at the taste difference between grocery store beef and fancy butchershop beef.
This is alternative protein’s ‘in.’ While alternatives have been rushing to make products that taste like meat, meat companies have been steadily producing products that taste less and less like themselves. All of which makes me wonder if we may be about to see a cassette to CD innovation disruption in the meat case.
If you are of a particular age, you’ll remember cassette tapes. With their better audio quality and smaller size than the earlier 8-track, cassette tapes came to dominate the early 80s music culture.
However, fast-forward to the late 80s/early 90s, and the cassette tape industry decided that better sound quality wasn’t a benefit they needed to prioritize because they were the market leader (even though superior technology existed, see Digital Audio Tapes). Instead, most cassette tapes of the time were cheaply made and sounded horrible. Not surprisingly, a new medium that promised enhanced audio (aka CDs) quickly disrupted the industry.
As the perceived flavor of industrialized meat and poultry declines, alternatives are poised to pick up the slack. Just as CDs elevated audio quality over cassettes, alternatives can elevate flavor over industrialized meat and poultry. This new Impossible burger is throwing down a new gauntlet, saying not only have we reached supermarket beef flavor parity, we’ve exceeded it!
In my opinion, this is the new battlefield, and one where alternatives stand a good chance of winning. Whereas previous marketing about sustainability and ethics appealed to a small niche, flavor hits the average consumer. If alternatives can offer grocery shoppers proteins that have flavors reminiscent of the most expensive heritage breeds and gourmet techniques (e.g., dry aging) (or honestly just taste like beef or chicken when everything else in the meat case is lacking) they could turn the tide. I can see meat and poultry companies retaliating with more flavorful cuts (see Trader Joe’s Heirloom, Slow-Growth Chickens)
The Dark Side of Cost Optimization
The WSJ had a video piece last week documenting the significant cost-saving initiatives going into effect at the QSR chain Chili’s. Years of supply chain disruptions, inflation, and labor issues has cut into the margins of many major foodservice establishments. Chili’s claims that their upcoming changes will save the chain $6.5 million a year. Changes include a double-sided griddle that cuts cook-time in half, buying pickles in smaller tubs, and using one batter across their fried chicken offerings.
So What? There is a famous story in the corporate world about how a single olive helped American Airlines save $100,000. According to business legend, Robert Crandall, then head of AA, was on a flight when he noticed that the passenger sitting next to him didn’t eat the four olives on his in-flight salad. This got Crandall thinking two things: (1) would anyone even notice if we removed one olive from the salads and (2) how much would that save us. After the research was done and numbers crunched, Crandall was shocked to find that passengers didn’t care about a missing olive and that one olive would save the company $100K a year!
Now, that story is always told as an inspirational tale to execs, reminding them that their profit issues could be solved if they were only more mindful of the significant waste hiding in their business. However, I’ve always seen it as a cautionary tale. While the removal of that first olive was prudent, the ensuing wave of deeper and deeper cuts has led us to the miserable experience that is today’s airline travel (where getting served even one olive on a flight would be considered a luxury).
When times are good, corporations pay less attention to details. It’s easy for wasteful practices to build up in the system and no one to care. Maybe your restaurant has three bread suppliers when you really could negotiate a better deal if you went down to one, or your pallets are over-engineered for your product causing you an excess in shipping fees. When lean times come, and they always do, finding this waste and reversing it can greatly ease the shock from the drop in sales.
The problem comes when the lean times stick around. With margin pressure mounting, the company begins to fondly remember the sweet relief provided by cost optimization and they say, “Do it again!” Teams are assembled, efficiency is found, money is saved, and margins are maintained. And then it happens again, and again. Soon optimization savings become a permanent line item.
On its face, this sounds like a good result. A vigilant company shouldn’t allow wasteful processes to take root in the first place. However, in my experience, optimization teams often get tasked with consistently bigger numbers each year to make up for bigger and bigger margin shortcomings. The result is that they go from removing single olives to getting rid of the salad course and eventually the in-flight meal all together.
While the mantra of these optimization efforts is to stop any action if it affects consumer value, too often the boiling frog effect takes over. Each individual cost-saving effort appears minor. However, over time, the collective stripping of features becomes substantial, and the overall consumer experience suffers.
But there is hope! I’ve known a few companies that don’t fall into the cost optimization death spiral. These companies share three common characteristics:
1. In prosperous times, identify and detail the product and experience characteristics that are non-negotiable. That way, when lean times come, you can’t talk yourself into cutting important corners.
2. Create a non-biased system that pushes back on the desperate pleas of upper management when calls come for too deep of cuts.
3. Don’t become addicted to continual annual savings from optimization in the first place. If you come to rely on it to make numbers, it will be abused. Employees will hit the metrics you give them, even if it means negative effects down the line.
Both Sides of Nostalgia
Lipton, a JV brand between Ekaterra (Unilever) and PepsiCo, has a new social media campaign called Pops of Summer where select winners will receive frozen pops made from the brand’s signature ice teas. Featuring a cover of the song ‘Steal My Sunshine’ by rapper T-Pain, the campaign capitalizes on the “sweet nostalgic bliss” of carefree summer days.
Speaking of frozen pops, Chicago-based company Glow Superfood is out with frozen, superfood dessert bars. The desserts are made of plant-based ingredients like organic mushrooms, adaptogens, MCT Oil, coconut sugar, and unsweetened almond milk. The flavors include Vanilla Chai Latte, Chocolate Chip Peanut Butter Cup, Pistachio Wheatgrass, and Hazelnut Chip.
General Mills is expanding its Monsters Cereals lineup with a brand-new character named Carmella Creeper. This new cereal mascot is not only the squad’s first new character in 35 years, but it is also the first female one. The new cereal features bright green, caramel-apple-flavored pieces with colored marshmallows.
Kodiak has been busy expanding their offerings. A new kid’s line, called Kodiak Cubs, offers a series of frozen flapjacks and waffles with little hands and taste buds in mind. Additionally, the brand is out with a liquid pre-mix in a squeeze bottle that will quickly make Power Cakes flapjacks (potentially in fun shapes) for hurried families.
Instructional baking company Baking Coach is out with a new line of Baking Activity Kits. The kits contain all the ingredients necessary for a home cook to make either edible cookie dough or baked cookies. Users simply add butter and water and mix the dough directly in the pouch.
Japanese toymaker Takara Tomy unveiled a new Ice Da Yo-Yo toy, made in collaboration with the franchise Sanrio. The Hello Kitty-themed toy looks like a yo-yo, but one side can hold ice cream base and the other ice, water and salt. As children play with the yo-yo, it churns ice cream.
So What?
Nostalgia is ‘hot’ right now for several reasons, but one important one is anxiety. Research indicates that our search for the comfort of nostalgia is triggered when we are faced with difficult and stressful situations. With the levels of stress and anxiety among Millennials and Gen Z at record highs, it’s no wonder that we are seeing a pull for adult popsicles and retro cereals. However, in our race to get nostalgic items to adults, I think we often miss the desire by stressed-out parents to build pre-nostalgic moments with stressed out kids.
Vox had a great report last week about the disappearance of American children’s playtime. Kids, the article states, have slowly lost the ‘freedom to play’ through a combination of the fear of violence (abduction, shootings, etc.), over-scheduling, and lack of green space in urban environments. This has resulted in a surge in mental health issues with kids, and more parents desperate to reinstate play in children’s lives but lacking resources to do so.
For all those reasons, I expect we will see more of the ‘food meets fun’ products in the years to come as parents try to make good memories for their kids.
TIDBITS
Foodtech company BetterBrand, producing low-carb, high-protein bread and bagels, now has a $170 million valuation
Pizza sales are nose-diving as consumers ease up on delivery
El Niño is coming for coffee prices
Beverages dominated Circana’s (formally IRI) 2022 Pacesetters report, with Dr Pepper Zero and Truly Margarita taking the #1 and #2 spots
Miller Lite makes a beer ice tray so you can enjoy cold beer without dilution
How the alternative meat industry saved Dippin Dots
Winery opens a hotline to help you find the right wine pairing for pizza
A photographic tour of McDonald’s uniforms throughout the years