Obesity Business Opportunities

Business (and innovation) opportunities are linked to demographic changes and data from which you can target a large or specific population to satisfy their needs.

In September 2010, the OECD revealed that Mexico was #1 in child obesity worldwide (and not too far in adulthood either), which grew concern in governmental health departments due to the future social and economical costs this might represent. Government did pull out a reform on controlling the food (specially junk food) sold to children in schools although the outcomes are yet to be seen. The regulation was a controversial measure since it arose the question "should government regulate market or is it just responsible of creating social awareness campaigns?". It was even more complex since it affected private interests, specially from large companies such as the soda and chips industries who find in schools a great captive market.

During a consulting sales project for a soda industry, I remember working with the brand "Chubby" a few years ago. "Chubby" is a small-amount soda from Puerto Rico with fun flavors TARGETED to kids, with neon colors and cute-round packaging. In those days I never stopped to think about health hazards with the product, I guess I thought since it comes in a small amount, it is best suited for kids, being consumed as an alternative for other larger sodas which are culturally consumed anyway. The truth is, now being aware of the obesity issue (diabetes and other sickness related), sodas in general (as they exist right now) should not be a drinking alternative for kids, at least not as frequently as they are or as an alternative to water for hydration needs. It is our responsibility to teach kids about it and for us to set the example in buying healthier products, and in that way to guide market as consumers. I do agree to regulate sales in a captive environment such as schools where there are no choice of going elsewhere and where kids have the purchase decision themseleves. What is also wrong is companies having marketing strategies targeted to kids when products could have health risks.

"Chubby" is honest, the logo is a morbidly obese character with a hip hop attitude and the brand name even refers to his obesity. Why then does it prevail? I do have to say kids love it, but parents (which are the ones buying it) also do, especially due to the nostalgia of their own childhood. Whose fault is it then? Marketing is not all. I would love working again with Chubby brand, this time in a challenge where the entire marketing and product is reconfigured for new health trends.

Regulations and new consumer demands (such as healthier food), open up opportunities for new product development, inside the organizations as well as for startups. For example a new Mexican company: International Healthy Snacks has gained popularity with their products such as Fit Bits being 100% natural snacks with 0 Fat. The company is shown as successful innovation case in Mexico. I applaud this initiatives.

What I do not applaud and even condemn is what the local company Laila's is doing. Continuing my "street reporter" phase as with the Mennonite post, I took some pictures that gave me the idea for this post. Can you tell what is wrong in the picture in the headline? Even with all the obesity related information and regulation controversies going on, this doughnut company PARKS their "ambulatory" selling carts outside schools everyday for an hour or two when kids finish their classes around lunch time. Sure you can regulate inside the school, but just a few meters in the street walk where the hungry kids gather after class? I think this is damn unethical, even cynical.

I guess it is also a "business opportunity" driven from the regulations and it is infact legal, but it consciously doesn't have society's best interest in mind and hurts a good governmental intention. Don't motivate these kind of practices and don't buy from them outside schools!

Mennonites and Branding

Today I bought Mennonite Cookies in the street from two adorable girls in a gas station. Mennonite population is scarce in my city, although there are larger groups in nearby states such as Chihuahua, people still find it strange watching Mennonites in their traditional outfits and blonde traits in the streets selling cookies. You can only see them eventually in specific street crossings at un-known hours and days, and then vanish, as if not being part of society. I’ve never seen them somewhere else or know where they live. I declare I don’t know much about Mennonites, customs and beliefs and this was even the first time I bought the cookies.

The package of three Mennonite cookies had a price of 15 pesos, but two packages were sold for 20. The discount for buying the second package seemed too attractive (almost 66% discount), that in my consumer mind even made me think it was mistakenly calculated or that people were paying a high price (almost being robbed) when only buying one. Still, I just wanted one so I paid the 15 pesos and asked them if I could take a photo. They said yes and smiled. Then the little girl on the left told me “I can give you that one package for 10” and handed back 5 pesos from the money I had already given her. Of course, I told her that it was alright and she could keep the extra 5 pesos, but her actions and the entire buying experience got me thinking and deserved a post.

No ordinary person would hand back money after agreeing on the price and already being paid, especially in informal street market and for an un-harmful small amount of money. Why then offering it back? Was it because she was an innocent kid? Was it because of Mennonite beliefs and values? Was she really outsmarting me first by saying the price was 15 when in fact it was 10 and then regretted it? I’m really not sure and will never know. What became important to me is that she did offer it back.

Then there was the package. No ticket, no stamp, nothing. Just a plain transparent bag with the cookies inside and a hand-done knot. It’s clearly not a business with marketing and brand strategies, but a way of earning some money with what they like and know how to do. But then I thought again. No marketing strategy? No brand identity? What about the little blond girl in traditional dress handing me out a no-brand product when I am in the gas station? Isn’t that a marketing strategy and a brand identity? Of course it is.

I am not saying Mennonites are consciously using their traits and traditions as brand identity and therefore not being authentic (I really think they stand for their beliefs and admire them for it), but in our costumer perception during purchase it does become a brand identity issue. Think it this way: Would it be the same if you bought the cookies with an elaborated packaging and brand strategy? It wouldn’t. Would it be the same buying the cookies out of a shelf in a big international store? It wouldn’t.

Buying directly from the Mennonites on the street is an interesting consumer experience worth analyzing. Even with no brand, their own presence translates characteristics to the product, such as delicious traditionally-made cookies with a “historically special recipe” not massively commercialized and even cheap. In some strange way, a brand (like logo, slogan, elaborated packaging) could even kill the product’s authenticity and value. The marketing and branding lesson:

· Authenticity sells. We don’t want fake promises or marketing phonies, we want the real stuff that can be transmitted through many ways, not only a logo and slogan.

Second, you actually feel you are helping others that are working hard in getting the money, it seems as if you were doing it for a social benefit or charity for people that deserve it, making you feel good, even though it is not necessarily like that. The marketing and branding lessons:

· Hard work sells. Make sure your client appreciates your value for their price and gain it with hard work. More than ever, what we pay for must be worth it.

· Feeling you are helping others is part of a gratifying post-purchase experience.

Third, there is also the visual impact of the experience that can attract customers. In Mexico, European blond traits are usually found in families that come from ancestors who had or gained some kind of wealth in the country. Those in need such as street beggers and hard son-working jobs (like informal street sellers) are not associated with white-blond physical traits. And here you have skinny delicate blond girls working in the middle of the day, wearing big flower old-fashion dresses, long white stockings and prairie hats. It is visually different, and what is different can attract us. Up until I wrote this sentence is that I realized these are kids and shouldn’t be working. I never give money to kids since their parents will continue sending them to the streets. I guess this same impact of the experience I am describing blinded me of the fact that this was child labour and exploitation. What lessons I find in marketing and even in innovation?:

· What is different attracts costumers. Visual impact is part of the experience.

· When you give for granted that “it is different”, you can overlook other things. i.e. The iPAD is not a computer, you can’t expect to work like one, “it is different”. (then again we don't want phonies nor un-worthy products remember).

Buying the cookies from the Mennonites, and even being offered to get some of the money I already agreed to pay back, is definitely a strong consumer experience from which we can learn. Buy the cookies they are good!