Saturday, October 18, 2014

Slaying the Fatted Cash-Cow

One of the unforeseen benefits of growing older, balancing receding hair, multiple mysterious aches and pains, and creeping conservatism is the occasional delight of having one's prejudices 'opinions informed by the wisdom of experience' validated. On rare and precious occasions this combines with the unadulterated delight of watching people be every bit as stupid as you always suspected they were. It's a particular form of schadenfreude gifted to the grumpy old bastards wise and experienced among us allowing we few, we old and knackered few, to smile and say to ourselves, 

"Oh God. I know exactly how that particular piece of idiocy came about."

Well this week I had one of those perfect moments, one so sublime I actually burst out laughing, and have been cackling chuckling about it for days (but not in a disturbed or insane-y way). 

It arose out of a recent dinner-table conversation with friends when I vouchsafed that economics was an entirely ridiculous and misconceived venture given that people are stupid, annoying, irrational creatures, and most decisions in business aren't made logically or even remotely in the best economic interests of the company. At the time I couldn't come up with a single example to back up my pompous, extravagant, dazzling claim, insight. Until last Tuesday, when the perfect illustration dropped into my breakfast trough plate.

Not a morning person.
I'm not a morning person. When I rise at the crack of noon for breakfast I am often hungover, not at my best. On brighter days my keeper, fellow inmate, beloved spouse will hand me a pair of mirrored sunglasses to stave off the sun's savagery until I've had my two pints of coffee and seven, two, four slices of toast. Any change or variation on this palsied routine is to be shunned as one would a rabid dog. I need consistent, predictable routine; caffeine, nourishment and silence. If all goes well I can grunt, fart, construct a sentence converse amiably with my wife on any number of urbane topics within hours, minutes.

Imagine my horror, then, when on several consecutive days I found my toast routine failing me. The butter, or rather, the 'Devondale Dairy Soft' kept falling off the knife before I could reach the plate. Worse still, when I had abandoned smearing everywhere, scraping up, cleaning up the dropped 'butter' and moved the plate closer to the butter container it melted so fast it ran off the edge of the toast and onto my trousers, iPad, fingers! I was bewildered, confused, appalled! Manfully, within hours, minutes I chose to investigate and discovered that the Devondale people had changed their product. 

As the lid now shouted it was: "NOW MORE SPREADABLE".

It was a situation that called for immediate action. So, two days later, I crafted an email in my best 'Angry of Mayfair' grumpy old bugger buffer style. I pointed out that I had been using their, bloody, damn, fine product for over twenty years, and given a reasonable life-span I had planned to use it for another thirty. I even went so far as to calculate how much cash they would lose ($4.70 x 52 weeks x 30 years = $7332) as a result. It's these little details that convey just how bonkers, loopy, potential stalker, concerned one is. The salient point, however, was this:

"Why take a mature product with a solid consumer base and steady sales and mess around with it? If you wanted to bring a new product in to the mix, fine. But don't wreck your own product for no good reason. That's just madness.."

Having ranted incoherently, had my hissy-fit, got the fuck over it, unburdened myself I cheerfully whizzed the missive off to the land of wherever this stuff comes from. I thought that would be an end to the matter. But to my surprise, Devondale's "Quality Manager Domestic Retail" sent me a reply. I reproduce it here, with slight annotations to make it bleeding obvious, underline the flaws in their thinking:

"Re: Changes to Dairy Soft.

In response to consumer demand for a more spreadable Dairy Soft, we recently improved our Dairy Soft butter blend."

  • Translation: We ran some focus groups to justify our existence, and talked Management into stuffing around with one of our best cash cows. We called it 'improving' it.
"We worked hard to find a way to churn the butter to make a softer, more spreadable product without having to change any of the ingredients."

  • We spent a lot of time and money on this. An absolute bloody fortune, and months of everyone's time. But the PowerPoint presentation went over great with the bosses and convinced everyone it was a winner. We just knew it would be a terrific success. Yay, us!
"Most importantly, we made sure we did not compromise the taste of Dairy Soft, which we know is the best tasting butter blend around. However, not everyone has enjoyed the new, more spreadable Dairy Soft."

  • Oh shit, it's a disaster! They hate it! The ungrateful bastards hate it! We've been buried in stupid complaints and loony phone calls from old farts and angry mums, and the sales figures are in the crapper! Oh God, I'll be lucky to keep my job and my career will be stalled for years, bloody years! Aaagh!..
"So we have listened. Dairy Soft will return to being made the way it has always been made. This change will be made immediately, and will be available in supermarkets in mid-November."

  • Oh God! Oh God! Oh God! Please let the sales figures come back! Please let the sales figures come back! Please let the sales figures come back!.. 
"Thank you for your feedback and for supporting Devondale, the Aussie Farmer Co-Op.

Yours faithfully,

           Xxxxx Xxxx , Quality Manager Domestic Retail."

Sadly, this is how businesses all over the world operate. When Coca-Cola brought out New Coke in 1985, changing the taste and substituting high-fructose corn syrup for cane sugar it cost them a fortune in marketing and 'research' and generated the biggest consumer backlash in history. It was the Edsel of the beverage industry. It cost Coke's management even more money to publicly rationalise their mistake. And this goes on all the time. And when people aren't completely ballsing up their jobs they're making completely irrational choices about what to buy, what to eat, and how to spend their money.

Perfectly normal. Perfectly.
People buy and sell stock portfolios based on a mixture of greed, fear and what their astrologer told them. They choose a new car based on their lucky colour. They make life-changing decisions on a hunch or a coin toss. They move to a new town, or stay where they are, because their psychic said it was right for them. They spend $ thousands on medicine for a pet, and ignore a starving homeless man on the way to the vet. They vote for the candidate with the nicest hair, or because the other one looks like a relative they can't stand. They even keep changing the packaging on a product for some damn fool reason and have me wandering in the damn dairy aisle looking confused all the damn time.

An intuition, or indigestion misunderstood as a gut-feeling is just as likely to sway a decision as logic, facts, the weather or the time of day. We are largely irrational creatures with a breathtaking capacity for rationalising our weirdest behaviour. Which is just as well. It's what makes us interesting, worth knowing, worth caring about. Worth loving.

Adam Smith's Invisible Hand of The Market is a complete fantasy, subscribed to only by those who need to feel secure in a confusing and chaotic world. It takes the irrational behaviour and decisions people make and irons out the human wrinkles until all that's left are graphs and statistics. Nice, safe, clean graphs and projections and statistics. And PowerPoint presentations, lots and lots of PowerPoint presentations.

"Oh my God we're out of bread!" 


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