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Kevin Ryan's: Culture Matters

The Trouble with Trust
Last week, a Panera Bread employee (@briannaraelenee) posted a short video of the back-of-house preparation of the restaurant’s mac and cheese on TikTok. Titled ‘Exposing Panera,’ the video quickly got picked up by several popular sites, racking up more than 950,000 views in a few days. The video shows the employee removing a plastic bag of the product from the walk-in freezer, submerging it in a hot water bath, cutting open the top and squeezing it into a bowl for service. Some users were outraged by what they saw. User @kaibrow commented, “Panera is just glorified hospital food.” @stunna_baby said, “ty, I always thought it was freshly made, smh,” (if you don't speak text: ty= thank you; smh = shaking my head) and @simplystrider said, “…but I thought they cared about what they cooked.”  Others were not surprised, comparing the prep to standard fast food or even gourmet sous vide cooking. Panera responded by saying the product is “made off-site with our proprietary recipe developed by our chefs and using our sourced ingredients that meet our standards for our clean menu offerings” before being frozen and shipped to stores. Within days of posting on TikTok, the Panera employee posted a tearful video telling her viewers she had been fired.

So What?  For many consumers, this story was a non-issue. CNN’s headline even mocked shock, ‘Panera defends its mac and cheese after a video exposed the menu item is, gasp, cooked in a bag.’ However, what is interesting, especially from a food industry perspective, is that for a significant portion of Panera’s consumer base--especially for younger consumers, TikTok’s main user—this story WAS trust-breaking and shocking. If Panera, a company whose success has been fueled by its clean food philosophy, can be momentarily weakened by an employee with a cell phone and a social network showing the truth (not some egregious action), what does that say about less prepared companies?  
‘Trust’ has become a hot topic in business lately. Books, seminars and whole conferences have been created to discuss the ‘trust issues’ that today’s consumers seem to have with brands. In the process, the whole concept of ‘trust’ has been complicated and contrived. ‘Building trust’ and ‘maintaining trust’ has been spun into a complex and multi-faceted ‘program’ that brands are now implementing on top of their day-to-day business. Companies now have ‘trust initiatives’ baked into their c-suite plans and ‘trust czars’ that sit on their boards. Honestly, I think this is all wrong-headed; an effort likely created by consulting companies looking to sell one more ‘process’ to deep-pocketed clients.  
In my opinion, the concept of ‘trust’ in companies is not a new issue and it doesn’t need novel solutions, just the better application of marketing principles that already exist. Let me take a step back. Trust is the reason that brands were invented in the first place. Faced with products of uncertain quality at a general store a few centuries ago, consumers looking to buy oats or tinned meat could put their trust in new ‘branded’ products like Quaker and Underwood that promised guaranteed quality. By slapping a name and a face on the product, early companies courted a relationship with consumers predicated on a simple contract of unwavering consistency. Even today, as brands have become much more complex and stand for more than just safety or quality, the central reason behind branding and messaging remains the same: to magnify the core values and communicate the implicit promises of the company.  As Dan Wieden (legendary adman behind Wieden & Kennedy) used to say, brands are verbs that shout their core values: Nike exhorts. IBM solves. Sony dreams. 
What’s happening today isn’t that consumers are becoming so untrusting that we need to upend the basics of marketing or advertising to win them back, its that brands are losing their ability to clearly and consistently communicate their core values across an ever-broadening sea of channels. I contend that while we blame consumers for becoming increasingly skeptical and less trustworthy, we are equally (if not more) at fault. Giddy with the potential behind all of the new avenues of advertising, we’ve spent too much of our time creatively blasting consumers with messages on every device they own and not enough time reflecting on how those messages are being interpreted, their consistency across channels and the expectations they are creating. As the saying goes, “It’s not what you say, it’s what they hear,” and when I look at some of Panera’s advertising, I can see where the problem started.
Here is a TV spot Panera ran last year and a print ad campaign showing bread baking, vegetables being cut and “specially shaped pasta, crafted to be delicious.” Most consumers undoubtedly didn’t take these culinary displays at face value, but quite a few did. In addition to doubling down on new messages that reinforced the idea that their ingredients were brought directly from the field to the kitchen, the company should have been checking in with consumers to understand the expectations they were setting up. Panera didn’t need to tamp down their focus on ‘clean food,’ but they probably should have inserted more clarity on how that ‘clean food’ is made possible. High expectations are a great thing to have in a consumer, but only if you can deliver. If their belief in you becomes too divorced from reality, you are living in a powder keg that can easily be ignited (i.e. a TikTok video). Checking in regularly on their expectations and maintaining a tight focus through all of your communications channels is the only way to keep your relationship on the right track.  
Oh, one last thing. You’ll notice that in all of this talk on trust I failed to mention the word ‘transparency.’ That’s because I think that concept too has been overblown. If we go back to the idea that brand relationships are like any other relationship, you’ll see my point.  For example, the reason we can maintain trust in our romantic relationships is because we set expectations  early in our courtship and live up to them every day through our actions. We don’t maintain them by arriving home every night and showing our significant other a log of our day’s texts or our daily Google Maps locations. Such blatant acts of transparency, much like brands that lead with transparency messages, have no place in a trusting relationship—in fact they resemble a relationship where trust has already been broken. That being said, that doesn’t mean that transparency is irrelevant. However, it should be kept in the background. Your significant other knows that IF they wanted to peek at your texts, you won’t hide them. Likewise, consumers need to know that IF they wanted to see where you sourced your vegetables, they could easily find out. The problem is, implementing transparency initiatives is so expensive that many companies insist on pushing them front and center to ‘recoup’ their investment—potentially hurting the very relationships they spent so much money trying to maintain.         
Take away message: when it comes to brand trust issues, the fault might be just as much with companies as with consumers. Focused, consistent, core value messaging and balancing expectations with reality will go a long way toward keeping your consumer relationship strong.
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The Reincarnation of KIND

Last week, KIND Healthy Snacks purchased the Creative Snacks Company, the first acquisition in KIND’s history.  Creative Snacks, founded in 2009 by husband and wife Hilary and Marius Andersen, has a product portfolio focused mostly on cluster-style snacks such as Almond Clusters, Coconut Snacks, Granola Clusters and Drizzlers (a handmade mix of dried fruit, nuts and granola with a yogurt drizzle) but also trail mix, dried fruit and nuts and chocolate-covered pretzels. The mission of the company is to make affordable, great tasting snacks without compromising quality. Since the beginning, the company has focused on giving back, actively working with the refugee community to create jobs and opportunities in their area.

So What? There are six main reasons companies make acquisitions, but to be honest, I was a little surprised which one KIND went with for their first purchase. Companies typically buy smaller companies to (1) gain access to a new technology; (2) obtain better distribution; (3) get into a new category; (4) eliminate a competitor; or (5) attract the best talent. However, none of these seem like the reason KIND acquired Creative Snacks, instead it (6) keeps them relevant.
When you look at Creative Snacks Company, you can’t help but see an earlier KIND. A company with a strong focus on incorporating whole foods into healthy snacking with an in-your-face ethos of social responsibility and equality; Creative is KIND circa 2004. My hypothesis is that, with this purchase, KIND wants to turn back the clock. KIND started out as the underdog and built a brand ethos of a small company that breaks the rules. However, KIND is now one of the big guys, with Nielson saying that, out of the 2,000 products in the nutritional bar category, six of the top 10 fastest-selling are KIND bars. My guess is that its slowly dawning on them that a brand built on disruption isn’t too comfortable with slow, single-digit, year-over-year growth and regular line extension innovation (i.e. big CPG). In fact, I think they’ve realized that becoming what they’ve always pushed back against might just mortally wound them, internally and externally. So they can either try to maintain their radical, disruptive demeanor at scale (didn’t work for their fruit snack business), change their brand to be less ‘edgy,’ OR buy their doppelgänger and try to do it all over again (but as a wiser company).
So, there are two ways to look at this if you are trying to compete against KIND. First, don’t underestimate how fast they will move with Creative! KIND knows what they are doing and they’ll find ingenious ways to sneak the brand into new occasions and channels. Their founder, Daniel Lubetzky, has admitted that even he is sometimes surprised at how saturated their distribution has become.  On the other hand, if my reasoning behind the acquisition is correct, it may signal a potential weakness at KIND. Their ubiquity has lessened their ‘entrepreneurial authenticity,’ and painting them as ‘just another one of the big guys’ could be their Achilles's heel.  
                                         Rekindling Wonder
The internet has been newly fascinated by ‘secret menus’ lately. Starbucks, one of the original founders of this movement, leads the pack with a Halloween themed Pennywise the clown Frappuccino and a Joker Frappuccino.  On the less scary side, consumers are excited by the secret twist on the company’s classic Pumpkin Spice Latte—Caramel Apple Pumpkin Spice—and by the internet finding out that there is a secret Starbucks menu just for dogs. Apparently, some people are just finding out that you can order a Puppuccino for your furry friend. (FYI—bakery chain Le Pain Quotidien also premiered an off-menu drink for dogs: the PAWmpkin Spiced Latte)
Not to be outdone, popular c-store Wawa has also revealed a secret Halloween menu accessible from their ordering menu. Consumers can access three spooky drinks if they know the correct order of buttons to push on the home screen.
Scottish brewer BrewDog Distilling Co. has launched their LoneWolf Gin by setting up a specially made pop-up bar in the Scottish Highlands. Customers that come to the bar are treated to a free drink and a tour from ‘grain to glass,’ but they first have to find the bar. The company has only dropped a few clues as to the whereabouts of the pop-up and it will only be around for a few days. 
So What? Too many sources of information might be hurting trust (see above), but its also hurting something just as precious: our sense of wonder. Pre-internet, you could see a wild stretch of forest or spy a strange flicker in the sky and your mind would race. What exciting and wondrous things could be happening? What amazing discoveries are waiting for inquiring minds willing to explore?
Then came the internet and shattered all the mystery. Its quick answers and matter-of-fact bluntness have taken the thrill of the unknown out of the world (that ‘wild forest,’ its owned by the state and contains a waste water treatment plant; that thing in the sky = swamp gas, probably from the waste water treatment plant).

Consumers want that wonder back.

Ok, maybe a secret drink menu at Starbuck’s isn’t in the same camp as discovering new lands or uncovering nature’s mysteries, but it serves a similar purpose. People want to believe that there are things in the world that a 10-year-old with a phone doesn’t already know, secrets and mysteries that require effort and aren’t instantly revealed by Google in 0.000001 sec.   
Its smart for brands to lean into this. Secrets and mysteries might be a solution to better brand engagement. Dangling the possibility that ‘there is more here once you dig in,’ could engage a hidden sense of wonder in consumers’ minds that brings about brand saliency in the future. However, there are caveats. If you are going to go through the trouble of making hidden menus and secret products, make them secret! Advertising them (I’m looking at you WaWa) just makes them menu items that are harder to access. The world of mouth component is key to the wonder and the bragging rights. Also, if the goal is to unlock a sense of wonder, the end result better be wonderous. If you make consumers go through the effort and they only get a mediocre experience, the impact on your brand could be devastating.
Brands I'm Watching 
Students at the Miami Ad School have created an experimental campaign called Ripe by Publix. To combat the issue of food waste, the campaign labels packaged food with chromogenic plastic strips. This translates the often confusing ‘use by’ or ‘sell by’ date into a color-based label. When the product is within its date, the strip is green. When it is approaching its expiration, it turns orange and then red. Finally, the label turns black when it has expired. The students suggest that the strips could help consumers manage their household inventories to help stop food waste. So What? Our evolution predisposes us to using our senses, not our rational brains, to determine if food is fresh. Ask someone to judge the ripeness of most whole food and they smell, shake, tap and touch it. However, with packaged food we have to resort to reading a label. Our inability to peek inside the package and let our senses be the judge results in a lot of consumers taking matters into their own hands (walk down the bread aisle at a grocery store and see how many people ‘squeeze versus read!’). Moving to a sensory-based system is a great idea.
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Reese’s, a Hershey brand, has released Mystery Shapes, a bag of chocolate-covered peanut butter treats in three new (but unnamed) shapes. The individually wrapped candies are the first new Reese’s shapes in 20 years. So What? Back in 2015, a group of angry Reese’s fans took to social media to complain that their beloved seasonal peanut butter- chocolate treats weren’t looking as good as they use to. Pictures of deformed Reece’s Halloween Pumpkins and Easter Eggs started popping up on Instagram, with misshapen Christmas Trees being labeled on Twitter with the hashtag #christmasturd. Mystery Shapes is a direct response to this ‘controversy,’ and a brilliant one. Most consumers will only see a novelty, but for a core group of rabid fans, an inside joke has been delivered. Often what separates big companies from little ones is a sense of humor. Legal departments and multiple levels of management often strip out any cleverness from big corporations. Bringing back this three-year-old joke shows Reese’s closest consumers that they are up for the game. It’s the equivalent of your brother gifting you those same socks you gave him last year—it signals a shared history and a common language.
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Over the last several months, Amazon has slowly and selectively been removing the barriers that made shopping for very low-priced items on the site inconvenient. In the past, if you were a Prime customer and were shopping for a single sub-$5 item on the site (e.g. a $2.79 box of Nature Valley Crunchy bars) you were forced to jump through hoops if you wanted Prime Next Day Free shipping. You either had to buy enough boxes to hit a minimum order amount (usually $25) OR the <$5 item was considered an ‘add-on’ and could only be added when an order hit a particular threshold. Today, that seems to have disappeared. Now, you can order quite a few $3, $2 or even $1 items by themselves and get free, next-day shipping. So What?  Dollars Stores have notoriously been Amazon-proof, but that might be changing. I’m not sure how, even with Amazon’s amazing logistics, the economics work out to ship me, ‘free’ (minus Prime membership) overnight, a $0.75 makeup crease brush, but this signals a massive change for CPG, Dollar and Drug stores. I’m sure much of the impact will eventually fall on the manufacturers, but for now it could radically change consumer habits. My advice to CPG companies: we are living in a magic window; once consumers see that they can order a box of Kashi Go for $2.99 with no strings attached they’ll likely try it and like it. Get into their virtual shopping list now, while its still a novelty, and you’ll probably stay there permanently.   
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