When Products Splinter

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When Products Splinter

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A couple of talks in the copious TED collection make a fascinating counterpoint. In the first, Malcolm Gladwell tells the story of Howard Moskowitz, who brought choice to spaguetti sauces. The take-away is simple: people have a diversity of tastes, and by creating a diversity of products rather than a median product, we can make more people happy. Obvious? No! says Barry Schwartz, author of The Paradox of Choice. He says consumers have too many products to choose from and that it causes a paralyzing anxiety.

Rather than wade into this debate, let me suggest that when we see a company like Arnold Bread create this product roster, something else is going on:

100% whole wheat, 12 Grain, 7 Grain, German Dark Wheat, Health Nut, Healthy Multi-grain, Honey Whole Wheat, Oatnut, Country Oat Bran, Country Wheat, Country White, Country Whole Grain White, Healthfull 10 Grain, Healthfull Flax and Fiber, Healthfull Hearty Wheat, Healthy Nutty Grain, Double Fiber, Double Protein, Grains & More Flax and fiber, Triple Health, Dutch Country 100% whole Wheat, Butter Split Top, Extra Fiber, Premium Potato, Premium White, Rye Everything, Rye and Pump, Pumpernickel, Rye Seedless, Melba Thin, Rye with Seeds, Soft Family 100% Whole Wheat, Soft Family Classic White, Soft Family Honey Wheat, Soft Family Whole Grain White, Brick Oven Whole Wheat, Brick Oven Premium White, Premium Italian, Stone Ground, Light 100% Whole Wheat.

By my count, there are 40 kinds of bread, and that is just counting the sliced breads, not the thins or buns. Is there really anyone in this world who loves the Arnold 10-grain, but can’t stand the 7-grain or 12-grain? More importantly in business terms, is the advantage of addressing these additional slivers of taste (if indeed people can make distinctions between the varieties – I can’t) really outweigh the additional expense of producing 40 separate packages, 40 separate categories of inventory, and 40 separate (at least slightly different) production processes?

My guess is no. The motivator here isn’t making the customer happier, it’s the oft-neglected fourth ‘P’ of marketing: placement. Even if the supermarket carries only half the varieties that Arnold offers, all of a sudden they are hogging a big part of the bread aisle. Arnold is the bread that is most likely to be close to your hand.

PS: You can read a follow-on post to this one here.

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26 thoughts on “When Products Splinter

  1. beren

    It’s foolish to credit the opinions of people who pay no price for being wrong, and it’s downright dangerous to let them anywhere near the levers of power.

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  2. Hal Duston

    Just the other day I ventured into the grocery store for the first time in quite a while. I was only picking up some milk, some bread, and some cheese. Since I normally get the non-refrigerated items first, I went to get the bread. There were so many to choose from I was paralyzed with anxiety. ‘100% whole wheat, 12 Grain, 7 Grain, German Dark Wheat’, my palms began to sweat. ‘Health Nut, Healthy Multi-grain, Honey Whole Wheat’, my heart rate increased. ‘Oatnut, Country Oat Bran, Country Wheat, Country White’, my breathing became labored. ‘Country Whole Grain White, Healthfull 10 Grain, Healthfull Flax and Fiber’, what if I get the wrong one?!? ‘Healthfull Hearty Wheat, Healthy Nutty Grain, Double Fiber, Double Protein’, the aisle was starting to spin. ‘Grains & More Flax and fiber, Triple Health, Dutch Country 100% whole Wheat’ the loaves looked like they might leap from the shelf at any moment. ‘Butter Split Top, Extra Fiber, Premium Potato, Premium White, Rye Everything’, I’m never going to make it out of here! Just at that moment a young mother with two small children came down the aisle between me and the shelf, glanced at me oddly, grabbed two loaves of ‘Soft Family Whole Grain White’, placed them in her cart as was gone as quickly as she had appeared. I managed to catch my breath, collect myself, and placed a loaf of ‘Soft Family Classic White’ in my basket and fled while I still could. Next item, the cheese. Do you know how many choices for cheese there are? … … …

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  3. dwbudd

    William, your question: “Is there really anyone in this world who loves the Arnold 10-grain, but can’t stand the 7-grain or 12-grain” is really not the right one. In a consumer market place, a better one is: ” Is there really anyone in this world who is OK with Arnold 7-grain or 12-grain bread, who prefer a Vermont Bread Company option and buy it, but who would love the Arnold 10-grain version?”

    Arnold is a company in business to make money, and if their customers can differentiate, or even if they think they can, then there is unmet need in that area.

    I personally am not a bread snob, and am pretty happy with my Orowheat potato bread.

    On the other hand, wander into a wine shop, and you’ll find orders of magnitude more choices of wine varietals, regions, years, and labels. Some people are happy with Two Buck Chuck, and consider claims that people can distinguish years and labels pure pretension.

    In the end, Arnold will either make money or lose it, and I doubt that a shelf-space power play is the malevolent force behind the scenes you imply.

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  4. D.C. al Fine

    Your guess? Your guess? Bakeries, other manufacturers, and retailers don’t guess. They survey. They test. They measure. They research. They demand or provide data. They analyze. They do NOT guess. You obviously have no idea how they make their decisions if you believe that increasing the number of products automatically increases a brand’s shelf space.

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  5. Ejohnson

    There was not a even a crumb of evidence whatsoever brought up to support the bloggers half baked speculation. Most suppliers to the grocery stores pay for shelf space (also called “slotting fees”). They then work with retailer to determine what items will be slotted there. Just because a vendor has 40 skus doesn’t mean the retailer will stock them.

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  6. Ed

    There was not a even a crumb of evidence whatsoever brought up to support the bloggers half baked speculation. Most suppliers to the grocery stores pay for shelf space (also called “slotting fees”). They then work with retailer to determine what items will be slotted there. Just because a vendor has 40 skus doesn’t mean the retailer will stock them.

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  7. backyardfoundry

    One solution to the problem of choice-engendered anxiety would be for sufferers to shop at a store like Aldi which offers so few options. But how will they choose the right no-frills store in the crowded marketplace? Maybe the communists are on to something with the simple life they offer.

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  8. backyardfoundry

    “He says consumers have too many products to choose from and that it causes a paralyzing anxiety.”

    Maybe for some purchases, but not for food, which is too cheap for a “mistake” to be very meaningful.

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  9. Mailmjm

    Fight! Fight!

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  10. Ken

    My guess… That’s all it is – a guess. And a wrong one at that. I can’t really do much better than nicmart, so I’ll just reiterate: Thank goodness we have smart folks in New York and California who know what’s best for the rest of us dumbasses.

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    1. William Gadea

      If anyone prohibited Arnold from having 40 varieties of bread, I would be picking up a pitchfork right along with you.

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      1. Ken

        What is the point of this post, then? The implicit point is that you think that this limiting should be done. You throw out the statement: Is there really anyone in this world who loves the Arnold 10-grain, but can’t stand the 7-grain or 12-grain? as if it’s just obvious that no one in the world can tell the difference. But the point is that some can tell the difference and that difference is big enough to warrant the different grains. Arnold is satisfying niche demands.

        What seems to you a (seemingly unnecessary) splintering of products into slight gradations is in reality the recognition of an ever wealthier population desiring to get exactly what it desires. For me, there are only a couple types of bread. While I don’t get all worked up about bread, there are things that do work me up and I appreciate the fine gradations producers offer in those areas.

        Your post seems to say that since you can’t tell the difference between the different grains, obviously no one else can. This is simply a self indulgent myopia. People have preferences different from yours, including in the area of bread. While you and I may care only somewhat about bread, neither of us cares if there is 15 or 40 varieties of bread. What you seem to not understand is that you and I are not the only bread customers.

        There is surely something in this world you care about that you appreciate producers developing 40 different varieties of it such that you can pick and choose the exact variety you want. The exceptional variety offered of any type of product isn’t offered for the typical consumer, but to the connoisseur, of which there are plenty when it comes to bread (and cheese, meats, milk, jeans, cars, etc.) to support and make profitable Arnold’s nice selection of bread.

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  11. Charles Rice

    “He says consumers have too many products to choose from and that it causes a paralyzing anxiety.” I have lived in big cities for nearly my entire life and usually shop at huge stores with a bewildering array of products. As near as I can tell, I have never seen a single shopper in a state of “paralyzing anxiety” due to the large store’s choices. Not once. In 30 years. Perhaps I am just not very observant of other shopper’s behavior, which is very possible. Safeway has made an absolute science of shopper behavior, so how has Safeway not noticed this and created stores that have only two or three choices for every item? If the opening quote were true, those limited choice stores would be very popular.

    My theory is that people do indeed *believe* they can tell the difference b/t the 7-grain and 12-grain, and that belief is enough for Arnold to notice that they can sell more bread with 7 AND 12 grain options than they can with just 7 OR 12.

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    1. Anonymous

      you should have seen my wife the first few times she went to an American grocery store.

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  12. B

    Bread that sells will find shelf space, and bread which does not will not.
    This ain’t rocket surgery here.

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  13. Anonymous

    Maybe you should research instead of guessing.

    I’ve managed health food stores which carried 40 or more vitamin C products, and maybe a dozen from one company. We stocked them because consumers wanted them. What you are attacking is freedom of choice. You are suggesting that stores should only carry the most popular products, at the expense of consumers who prefer less popular products. You also assume that you know better than consumers what they want, which is an arrogant and dubious assumption.

    Once, while visiting a small bookstore in San Anselmo, California, I overheard the owner sneeringly say that there was no need for more than one kind of breakfast cereal. I considered asking her why she stocked 5 different adult dictionaries. No doubt her customers (affluent and white) could be trusted to know what books they needed, while the cereal buyers were all imbeciles vulnerable to the seductions of advertising and placement.

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  14. Ritwik

    Sorry, but the even if they stock half ..’ is an absolute dead end. Why should they stock even half, or even 2.5% for that matter. Margins.

    Not to mention the fact that having 40 SKUs adds significant cost of complexity to the back end.

    My guess is, over time you will see Arnold slashing its product portfolio.They are on one stage of a cycle/curve where the dominant thinking is to grab market share by offering more choice. After some time they will be in a ‘focus on the high margin basic stuff’ mode, wherein we will get another article from somebody else explaining why that is more rational.

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  15. Anonymous

    That’s not consistent with the behavior of grocery stores, which are shelf space limited and simply won’t stock 40 or 20 or probably 10 and likely not 5 different breads from one company without a reason of their own to do so.

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    1. William Gadea

      Check next time you’re at the supermarket. I live near a small one, and even they must carry at least ten, though probably not as much as twenty varieties of Arnold. I doubt that the supermarkets are passive dupes in this, but when a market leader says “we have this product that’s done well elsewhere,” they probably are willing to push out the laggards and open up some space. More space means more exposure… rinse and repeat.

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      1. Anonymous

        Please explain why reducing consumer choices would be a good thing.

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          1. Anonymous

            Your enthymeme is that we do not want such a great variety of choices. That so such diversity is foisted upon us.

      2. Anonymous

        my local Safeway owned store outside Chicago has three types of Arnold bread. I think Sarah Lee was the leader with 5. Arnold also got bottom shelf treatment.

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        1. Nachum

          Sara Lee’s bakery products are owned by the same company as Arnold’s, which also owns quite a few other well-known names. And they market them all! Horrors!

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    2. Ross Patton

      This is not true. It’s common practice, especially at larger grocery stores, for companies to buy shelf space for their products. Customers don’t like the product? Doesn’t matter: company X bought that row. Company’s want their products to be seen and appear popular, even if they aren’t.

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      1. Anonymous

        do I really need to link the picture of the bread isle I took the other day? The only things I can think of that really match this are soft drinks and laundry detergents, where they will stock a large variety and large percentage of the producer’s catalogue. And, of course, with beverages you have Pepsi saying I’ll be damned if Coke gets an inch more than we do” and working against it. Want to bet on finding similar parity in the bread isle across brands?

        . And Arnold or Safeway, from what I saw, was more interested in pushing their Italian with the space they did have than their variety.

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