• Some brands remain untouched by discounts – Yet another (rambling anecdotal) story about changes in purchase behavior. We just did an ethnographic study in this area and didn't see (or probe for) the brand-motivating power described.
  "The reasons fall mostly into three categories: old habits die hard, brand loyalty runs deep and the Economics 101 law of supply and demand means the most sought-after brands can command the best prices. Beyond that, there are some items consumers stubbornly just won't forgo — sale or not — no matter how hard they're trying to stretch their budget.
  …
  "There are certain categories … where there are no substitutes accepted. It's infusing your brand with those things that people then say 'I have to have the real thing.'"
  …
  Heather Fox scours stores for sales and clips coupons for food and clothing discounts. But she won't cut corners when it comes to her Marlboro Lights.
  …
  Corlett puts it differently. "You may drink less Coke, but you're not giving up Coke," she said."

Coca-Cola is running a three-page ad in the Sunday paper.

As part of our ongoing commitment to finding new ways to suit your changing tastes and needs, we’re always working to develop innovative options. We’d like to say thanks for the inspiration. And please stay tuned, because it’s just a taste of things to come. To learn more about our latest innovations….

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I noticed the use of innovation twice in their copy and as much as I like to throw the word around, I’m often troubled when I see how it’s being used by others. I think most of us find new brands or new products or new packages interesting (granted, some of us more than others!), but the small can (for example) isn’t new.

Mini cans of Pepsi, Burlington, ON, 2004

The ad also reminded me of an image from 2005, showing just the diet beverages sold by Pepsi.

That’s a lot of choice! But good luck trying get a handle on how many different things Coke sells. It’s impressive and overwhelming. Their huge list of brands (worldwide) is here and a virtual, global vending machine is here.

Meanwhile, Oroweat is doing their small-packaging bit with new smaller bags of bread.

I wondered what has changed that necessitates this new package? Are breadboxes getting smaller? According to their site

, the smaller bread package came out at the beginning of 2007 (emphases mine)

New Smaller Loaves Fit with Industry Trend of Reduced Size Options

The unique line of mini-sized variety breads are perfect for smaller households or families that like to buy several different varieties of bread. Although the loaves are smaller in size, they deliver the flavor and quality known from Oroweat.

“We all like the freshest bread and many consumers have told us they cannot finish a full size loaf of bread before its expiration date. Oroweat Mini Loaves are the perfect solution for smaller households that typically toss away a portion of a loaf of bread,” said Dan Larson, Oroweat Marketing Director. “Mini Loaves also make it easier to enjoy a variety of breads for different occasions; including 100% Whole Wheat with whole grain nutrition, and Country Buttermilk, a favorite for the perfect grilled cheese sandwich! Now you can have both. This is one more example of Oroweat’s innovative thinking to offer new options that are important to our consumers.”

With the average number of people per household just over two in the United Sates, smaller size offerings are gaining attention in the food industry. Keeping an eye on trends and listening to consumers, Oroweat is one of the first bread companies to introduce smaller loaves. Last year, Oroweat successfully introduced premium buns in four-count packages.

Oroweat confirms it, then. Small packaging is innovative thinking.

The Loft store in Tokyo has an entire section that offers a huge range of reusable grocery store bags. Do the Japanese values around “choice” and “sustainability” collide? Does it make sense within that culture? Does it make sense to outsiders?

I had an uncomfortable reaction along the lines of “Oh, crap, something else to buy.” It seemed to contradict my expectations of restraint in a product category that carries a meaning of “sustainable.” Of course, that may not be the meaning that these bags have in Japan.

Unsurprisingly to anyone who knows of the early Louis Cheskin work, a recent Stanford study established that the more wine costs, the more people enjoy it, regardless of how it tastes.

Expectations of quality trigger activity in the medial orbitofrontal cortex, the part of the brain that registers pleasure. This happens even though the part of our brain that interprets taste is not affected. While many studies have looked at how marketing affects behavior, this is the first to show that it has a direct effect on the brain.
…
“We have known for a long time that people’s perceptions are affected by marketing, but now we know that the brain itself is modulated by price,” said Baba Shiv, an associate professor at the Stanford Graduate School of Business.

When we worked with a wine brand recently, we sought to understand the complete wine “usage” process, from planning, through shopping, to storage, to opening, to serving and drinking. We looked specifically at people who were interested in lower-priced wines and most of them were limited in their knowledge and/or experience.

In other categories when the customer is new and is presented with enormous product choice (the amount of wine choice dwarfs most other categories I can think of) we might feel sympathetic for the learning/selection/usage learning curve they would face; with wine people spoke very enthusiastically about the journey. Each trial experience involved drinking wine…something they liked to do! A social, tasty, and rewarding experience. Even a wine they “didn’t care for” (the typical critique) wasn’t a failure, because it still carried all the symbolic meaning.

The marketers were hampered by a limiting view of their customers; the market had been sliced into ridiculously narrow price points and this inevtiably drove discussions of people characterized exclusively within those $3 slots (as in, “I’m a $7.99 to $10.99 drinker”). While our client no doubt had cash register data to support their segmentation, it was completely at odds with how people saw themselves. They purchased across a much broader price range, and their primary concern was their own knowledge and accumulated experience. We were given a great opportunity to offer this different view and illustrate some of the unmet opportunities this presented.

In The Paradox of Choice: Why More Is Less

and The Substance of Style we learn about the dramatic increase in choice for so many products and services, why that is, and what it means to our experience with those products and services.

But let’s not forget that things go other way as well. Like the banana convergence I blogged about before

, apples are a paradox of limited choice.

The United States was once home to more than 10,000 named apple varieties, but nowadays it’s hard to find more than a handful, even at farmers’ markets.

Although theories like those authors put forward (and I’ll throw in the Long Tail too) are useful lenses to help make sense of out what we see there often completely opposite gravities occurring simultaneously. But hey, culture is a complex beast, isn’t it? Because both of the contradictory trends are indeed true.

This weekend we checked out Palo Alto’s new restaurant, The Counter; a place that is having some buzz in the blogosphere (and their original Santa Monica place supposedly being mentioned on Oprah). The thrust seems to be highly customizable burgers. Kinda like The Fractured Prune’s version of donuts I blogged about recently.

I was surprised at how sedate and genteel the whole thing was, aesthetically. I was expecting much more of a cartoony-branded affair. This was nice.

Even the cash featured art more than heavily branded graphics. This worked against them a little bit – it was hard to figure out what to do, there was no hostess stand. Upon coming in, if no one is there to greet you, you see a stack of cilpboards with menus. Are these for us? I actually told the guy who came up “we have no idea what we are doing” – a comment I wouldn’t normally make (I’m not that insecure, but really, we couldn’t figure out the script. A bit more wayfinding signage, branded or not, would have helped.

Here’s the menu:

There’s a lot of choices there! It’s surprising, exciting, and overwhelming. They could use a little help in form design here, again, asking you to wayfind through a series of decisions (although burger OR bowl needs some visual work to make the decision-fork a little clearer). But really, the impact of that massive set of choices (some with price premiums, some not) is pretty incredible.

They have mitigated that slightly with a set of pre-defined burgers, where they’ve chosen a few combinations, given them names (The Counter Burger) and saved you the trouble of figuring it out. But what I want is to make my own custom burger – the key experience here, it seems – but with some guidance: what goes with what? what tastes complement other tastes?

If you want to redo a room, you can consult a color wheel for info on complementary colors, you can find advice that might tell you to pick the carpet first and then select paint and fabric next [whatever the advice might be], that hot colors look good in a small room, and cool colors in a big room will make it feel more empty [again, or whatever – I’m making this up].

It’d be pretty amazing to have some help with this, if you want it. If you know what you want to eat, go for it, but if you need some help pairing up sauces and buns and so on, what can we do? Perhaps The Counter wants you to experiment and come back over and over again (we felt that urge, certainly), but what fun it would be to have some guidance!

We figured it out, eventually, with a mix of traditional (tomatoes) and curious (hard boiled eggs, english muffin) choices.

Appetizers: dill pickle chips, yet again proving that anything is good when breaded and fried. And a half-and-half appetizer of regular fries (poor) and sweet potato fries (good, but not the best I’d ever had).

Burgers were unique, tasty, fun. Overall a good experience. We’re eager to go back and try something different next time. But $70 for four burgers, appetizers, a couple of beers and glasses of wine? Ouch.

They had just the right amount of new-restaurant inquiries from servers and managers asking us if everything was okay; good problem solving when something was missing (they ran in and got us a plate of the stuff we wanted).

We see these in small retail all the time – handwritten signs exhorting the customer to follow some non-natural path of behavior in order to simplify the merchant-centered purchase process. Here’s a fun one, where the experience is pretty cool anyway, and the creativity and ineffectiveness of the signs is something to smile about, rather than grimace.

The setting certainly helps. In the town of Waimea, on Kauai, on your way to getting a sweet and cold treat – shave ice.

The cash register sits underneath the most awesomely diverse and interesting list of flavors. You approach the guy at the cash and of course you want to say how many you want, and what sizes, and (after having gaped open-mouthed at the display for a few minutes) the flavors

.

The signs attempt to warn you off from doing that, but it’s human nature. And with each person that tries to ask for a flavor, the cash guy tells them ‘I don’t care about flavors. I just need to know what size you want.”

They are so dogged with their insistence, but they’ve designed an experience where it’s entirely natural to ask for the flavors right then. Nope.

He’ll go and get the plain shave ice (with ice cream, if you want it) and then at another counter they take your flavor order. It may end up being the same guy working the other counter, or someone else. But they don’t care about flavors, until you get to the flavor counter.

It’s not so terrible that they go through the same thing over and over again, it’s just a great example of design and human nature and the ever-present sign which purports to fix the whole thing by simply warning people what not to do!

This sign is posted behind the cashier.
1. How many Shaved would you like (ice)?
2. What are the sizes you would like?
3. Would you like ice cream on the bottom?
4. Would you like our tasty creams on the top of your ice We have Vannilla Cream And also Haupia cream (which is coconut)
5. We do also sale extras so this would be the time to ask for them
Mahalo (thank you)

The cutaway detail of the Halo Halo Shave Ice is pretty neat. Nice combination of 2D and 3D presentation of the details:
Haupia cream topping
cocohut
Shave Ice
Haupia cream topping
Halo Halo
Ice cream opsional [sic] with Halo Halo

The SF Chron writes

about those little extras costs on various services that add up pretty dramatically, with some economics research on how we perceive and make decisions around fees.

“In the end, you don’t fool the customers with the hidden price,” he says. “They know they’ve paid it even if they didn’t know they were going to pay it.” And if they feel ripped off, they won’t come back. In the cell phone industry, he says, carriers lose 40 percent of their customers each year, a tremendous “churn” rate that industry players are starting to take note of. Sprint, Nalebuff points out, recently began pushing what it calls its “Fair and Flexible” plan, which adjusts customers’ calling plans to minimize overage charges. Sprint is betting, in other words, that customer loyalty is worth more, in the long run, than sneaky fees.

They consider the cost of ink in owning a printer, and hotel costs. The quote takes a customer-centric view of what will most effective, but consider the switching costs (in terms of time, aggravation, and sometimes money) for banks, credit card companies, telephone service providers, and internet service providers. Not to mention that some hidden-fee situations such as utilities or cable TV may be monopoly situations. Frankly, we get shafted by these firms because they can. Because it’s too hard to make the switch or there is no one to switch to. It’s not loyalty on our part, or tolerance for this sort of crap, indeed there may not be any place to go. Do you see CitiBank or Wells Fargo or Bank of America as having dramatically different fee policies (we could investigate and see, for our specific needs, what the advantage is, of course, but my point is that these companies are all playing these games, and if you start factoring in the research required, it’s just silly)? Of course not.

We live in a society of choice, but not ubiquitous simple cross-category choice. If Coke on the shelf is going to charge a hidden fee, and Pepsi on the same shelf isn’t, then after the first time, we might consider Pepsi differently (for those who aren’t powerfully loyal to a beverage). If one gas station has a hidden, and the one across the street doesn’t, sure. On a purchase-by-purchase basis, there can be lots of choice.

But for an ongoing relationship, who the hell can deal with making changes. Would you change your car insurance? Your house insurance? Your health insurance? Your calling plan? Your broadband provider? Not if you could help it, not unless driven to it.

I wish it was easier, and I appreciate the pro-consumer attitude the Chron quotes, but I just don’t think it’s realistic.

Probably everyone knew this but me, but Fossil Watches offers an impressive (at least in terms of number, if not actual appeal) array of themed watches. Themes (or shall we call them brands) include Ohio State, Universities of Illinois, Alabama, Michigan, Tennessee, Florida, as well as Starck, Gehry, Atari, and some other geeky options. Fossil is riding the same trends as everyone else – co-branding with entertainment properties, designers as brands, target = “_blank”Substance-of-Style-esque massive choice.