Jeff Koeze's Blog Good Food, Good Business, and the Good Food Business

25Nov/090

Powerpoint Banned, at least by me

Those who know me know that I hate Powerpoint.  I refuse to use it and have attempted to ban it internally at Koeze Company, Koeze Direct, and Nuthatch Software.  My co-workers always giggle nervously when a salesperson hauls out the slides, but I'm usually quite nice about it.

Among the things I hate about Powerpoint is that its use encourages passivity, as VC Fred Wilson points out in his blog:

A presentation is like a TV show. It's a lean back experience. A discussion is like an online chat room. It is a lean forward experience. They are not the same thing and in many cases they work against each other.

The last word on Powerpoint is Edward Tufte's essay The Cognitive Style of Powerpoint.  Federal law should prohibit use of slide/presentation software by those who have not read and passed a test based on this essay.

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23Nov/090

Amazing Unemployment Graphic

An amazing animated graphic of the spread of unemployment in America: The Decline: Geography of a Recession, by Latoya Egwuekwe

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23Nov/090

Customer Service in the Call Center

Sunday's paper had an interesting article on call centers and why dealing with them can be so frustrating.  One of my companies, Koeze Direct, has to staff up to run a seasonal call center every year, so I'm pretty familiar with the challenges of attempting to provide good customer service.

As the article points out, customer service begins with training:

But I was surprised, in some cases, how much training such workers did receive. Ms. Strong and Randi Busse, who worked at a Verizon call center on Long Island for 15 years, both said they underwent 12 weeks of training, close monitoring for a while after that and continuing training during employment.

But training is often complex because the IT systems used to operate customer service centers are so complex:

One problem, Ms. Strong said, is that most people don’t understand how difficult her job could be. “For one call, we have to look in a million places and go through a myriad of information,” she said.

Work schedules have to be based on projections about call volumes and other call center work loads.  Sometimes they are wrong:

[Sometimes] enough workers are scheduled for the expected number of calls, but a storm, a rate or policy change or a new product introduction can mean an onslaught of calls with too little staff available.

But all the planning and training in the world can't make up for the mixed messages that call centers send with their productivity standards that require call center agents to hurry up and provide good service -- a contradiction in terms:

[One agent] said the average call was supposed to take just under five minutes, and her target was to answer 70 to 100 calls a day. Although she was not judged solely on the number or time of the calls — and said she was never told to shorten a call with a client — the number of calls she handled was one part of how her bonus was determined.

While we do watch our call lengths, we don't give any incentives, positive or negative, to get customers off the phone quickly.  I will admit to cringing a little  bit when I hear that one of my agents spent 45 minutes chatting on the phone with an elderly customer,  but patience and listening are key to taking care of customers.

16Nov/090

Reading Your Peanut Butter Label

I have a bunch of Google alerts set to pick up blog postings about peanut butter. And what I've learned is that people are really confused by the labeling and ingredients in peanut butter products, and they especially confused about the difference between "natural" and "organic" peanut butter.  Justifiably so, because it is confusing.   Here is my explanation.  It is long.

In the beginning, there was peanut butter.  It was all the basically the same, consisting of ground peanuts, and, almost always, salt.  The liability of this peanut butter, then as now, was that the oil in the peanut butter and the solid components would separate over time with the oil coming to the top.  This is because peanut oil is liquid at room temperature.

In the 1920's and '30's, the separation problem was solved by adding hydrogenated vegetable oil to the peanut butter.  This had the effect of making the oil solid at room temperature (think Crisco).  Added in small amounts (as little as 1% by weight) by skilled manufacturers, the hydrogenated oil was enough to prevent separation.

As time passed, manufacturers figured out that hydrogenated oil was cheaper than peanuts.  As was, I believe, sugar.  So these ingredients began to be added to the product in higher and higher amounts.

In response, the Food and Drug Administration passed a rule (21 CFR 164.150) that provided a "standard of identity" for peanut butter.  This provides that to be labeled "peanut butter" a product must be 90% peanuts.  Anything with less than that must be called "peanut spread" (21 CFR 102.23).

Under the general requirement that foods use ordinary and customary descriptors on their labels, peanut butter labeled as "natural" or "old-fashioned" contained only peanuts and (usually) salt.

So, for the last 30 years or so, the world consisted of two kinds of peanut butter:  homogenized peanut butter and "natural" or "old-fashioned" peanut butter.  This was pretty simple, and I think everybody knew the game.

Coming forward to today, first add USDA organic standards.  These rules has nothing to do with the prior regime created by the FDA.  Either homogenized or old-fashioned peanut butter can be organic, so long as the ingredients meet organic standards, and they are made in a facility that meets organic standards.  The result is that not all organic peanut butter is "natural" by the ordinary, traditional nomenclature, nor are all natural peanut butters organic.

It gets worse.

Recently, the food marketers have gotten aggressive with labeling again, and I believe this is leading to additional customer confusion, based on what I'm seeing on the blogs.  (I'm not going to name names here because I didn't create this blog to attack competitors.)

Some companies have begun describing as "natural" peanut butter products that contain both palm oil as a stabilizer, and sugar.  Others have created products that contain 90% peanuts and a variety of other ingredients -- including things such as flour and chocolate topping -- which are being sold as "peanut butter spread."  Yet the most prominent word on the label is "natural," which again, some bloggers, wrongly in my view,  are describing and reviewing as a natural peanut butter.

On top of that, there are all of the various peanut butter and flavor combinations on the market -- pb and honey, pb and chocolate, etc. etc.  There are a number of peanut butter products that have enhancements that are marketed towards health and nutrition oriented consumers -- pb with Omega 3's, pb with flax, pb with sunflowers, etc.  And there are reduced-fat products on the market.  Depending on the ingredients, these may also carry the "natural" or "organic" labels.

I, self-servingly, advocate the KISS approach:  Cream Nut if you like the fuller flavor of Virginia peanuts, or Sweet Ella's if you either like a little sweeter peanut or prefer organic products.

13Nov/090

George Washington Carver Did Not Invent Peanut Butter

But who cares?  Carver was a remarkable person.  I would love to get to Philadelphia to see the exhibit put on at the Academy of Natural Sciences.  But I'll be there in spirit.  Their gift shop placed an order for our peanut butter to sell with the show.

G-W-Carver-flash

7Nov/090

Shameless Self-Promotion — Oprah Edition

Check out my Cream-Nut Clusters on Oprah's gift-finder!

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6Nov/090

Employment Prospects Look Bleak

Navigating this business downturn is has been difficult, but the unemployment situation is simply tragic.

I was struck today by this chart from Calculated Risk, which shows the decline in employment from the prior peak in several recessions graphed against the number of months of the decline.

EmploymentRecessionsOct

(Click on the chart to make it huge.)

One look at this tells us that the road back is going to be long.  I'd hate to see what this chart would look like for Michigan, with unemployment over 15%.

This lead economist Paul Krugman to suggest in his blog that we consider bringing back the WPA and CCC work programs.   Giving the suffering this kind of unemployment entails, and the length of time it looks like it will be with us, I'm for it.

5Nov/090

What’s Wrong with Marketing Firms

I have a love/hate relationship with marketing firms.  I often love the people who work at marketing firms.  I love the cool offices at marketing firms (though I don't like paying for them).  And I even sometimes love their ideas.  But there are lots of things I hate.   Several blog posts worth, I suspect.

The thing I hate most is being asked "What is your budget for this project?"  Or, worse yet, "What is your marketing budget overall?"

I always answer the same way:  "My budget is unlimited.  If you can generate (and measure) positive ROI on this project and any future projects there is literally no limit to what I will spend.  As long as your ideas keep making me money, the budget just keeps growing."

I have never been asked: "What is your ROI goal for this marketing project, and how will you measure the ROI?"

To me, this is the difference between being asked "How much of your money can we spend?" and being asked "How can we be sure the money you spend with us will produce an acceptable ROI?"  The first question is about how much money the marketing firm will make.  Now, here is something that might a be surprise to some marketers: The second question is as well, since that positive ROI is going to be the source of the cash to pay for your future work.

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4Nov/090

Talking ‘Bout my Certification

The controversy over the Smart Choices program has me thinking about consumers' growing interest knowing more about their food and the people involved in producing and selling it.  This has created an exploding number of rating systems and certifications from the grand-daddy of them all, kosher certification, through labor certifications, organic certifications, fair trade certifications, environmental certifications, animal welfare certifications, and so on.  This all on top of the variety of local, state, and federal regulatory schemes with which businesses are supposed to comply.

Today I learned about two interesting programs which attempt to go beyond the welter of fairly narrow "single issue," if you will, certifications to attempt more comprehensive looks at corporate behavior.  The Good Guide works from the level of individual consumer products, but beyond narrow issues of health and nutrition it purports to evaluate manufacturers on a wide variety of social and environmental factors.  The B Corporation works from the corporate level, and has what I would call a governance focus.

This is a fascinating area of development, and it will be interesting to see if any of these efforts gains sufficient traction to be a meaningful force for change -- approaching the mind share of the "Good Housekeeping Seal."  (I wonder if that is meaningful anymore? I remember hearing it as a child, but not recently.)

My own guess is that none of these efforts will penetrate the fog of constant consumer marketing and provide enough consumer market muscle to be worth much, thoough I think a few of the "single-issue" certifications will gain traction with consumers passionate about those issues.  The rest, especially the broader ones, will fade out, with the possible exception of the "local" movement.  More on that later...

2Nov/090

More on “Free” Shipping

This morning I was greeted by emails from a few Koeze Direct customers asking about whether we were going to repeat some of our prior free shipping offers.  A couple explicitly said, "Give me the free shipping, or I'll buy from someone else."   I emailed back to say how sorry I was to lose them.

Like all direct marketers, Koeze Direct loses a certain number of customers every year.  These customers need to be replaced with new ones, and that often requires making some sort of special offer to inspire prospective customers to give our products a try.  We lose money on the first order, but we hope to land a loyal customer and make a profit in the future.

For several years now, a "free shipping" offer has been the #1 motivator for new orders in the direct marketing business, and we have tested these offers extensively.  But such offers can only be successful if we retain those customers and they are willing to pay shipping going forward -- either in the form of shipping charges or in the form of higher prices for our products.  (For more on this, see this post.)

What we are beginning to see is that free shipping has become an expectation from some customers.  If this expectation becomes the norm, it will pose a huge challenge to the mail order business.