Pink Slime Effect: Was The Consumer Reaction Irrational? Will Organic Food Take A Lasting Bounce?
As has been widely reported, "Three of four pink slime factories have been temporarily shut down after public outcry over the highly processed beef product."
Pink slime's temporary market collapse might very well have been based on irrational consumer reactions. The stuff has been sterilized pretty effectively with ammonia, after all. Risk of exposure to E-coli could at times be worse with spinach or with a meat product containing no pink slime at all. If E-coli superbugs continue their march toward the human mouth, more of us will be begging to be slimmed, or tempted to go vegetarian, or go only with organic and local meat or dairy. Those are the consumer market segmentation choices. What choices do food company execs have?
I say forget about the science. Most consumers are unable to grasp statistics and have no comprehension of risk management basics - if they did get risk management, then you would not have half the populace agreeing with the Republican bobble heads claiming climate change is not caused by human activity, and blah blah. What really matters is what Mom would say.
When a totally new production method or product formulation is being introduced at large scale, generally the first thing executives will ask their R&D team after how much do we make would be is it legal. The answer relative to pink slime (PS) was always a definitive yes, once the relevant Federal regulatory agencies signed off on unrestricted sales.
The next question would logically be is it safe and technically, yes, PS is safe under the stipulations of regulatory agencies.
The more important question to ask before going commercial with a novel new process or product - this would be especially useful if there is a formal stage-gating procedure - is this: What would your mother say if you told her in non-technical language what you were working on? If describing the project or product to Mom would not allow you, her food-executive son or daughter, to pass the red-faced test, then PROJECT HOLD.
If Mom herself got red-faced on hearing the project description, either out of anger or embarrassment, then PROJECT FAIL.
Broader marketing lessons.
Even if the science looks good, the lawyers said all is well, and paid customer focus groups were favorable, hold off for a bit until you ask Mom. Actually, ask a bunch of executive Moms. Just don't do it on Mothers Day.
I'm going out on a limb here. Mom will keep sticking her nose into business decisions whether or not the suits like it. She buys most of the food. Even so, the temporarily-closed PS factories will likely re-open, serving increasingly segmented markets. One segment, the organic one, will take a bounce from it, I predict. The other will need a cargo container.
To summarize: the public relations debacle over PS has strengthened the resolve of current organic and free range meat/dairy/egg consumers to keep the faith and maybe even buy more organics. Beyond that, newly interested consumers are sampling the organic fare.
Early indications of a Pink Slime Bump.
My year-old post on Organic Butter Is Better - Tastier And Shapelier - Why? just took a big jump in readership. I will be watching to see if this is a trend. Let us know what you think!
Last nite my local grocer was totally sold out of all organic and/or free range eggs. The shelf stocking guy said organic is flying off the shelves. If the Supreme Court throws Obama Care in the ditch, which they seem likely to do now, eating better will be the cheapest and most affordable form of health insurance there is.