Sunday, November 18, 2012

Hostess' demise a tragedy, but not for the reasons you might think

First of all, I want to offer my condolences to the tens of thousands of Hostess employees who will be affected by the bankruptcy and disappearance of Hostess treats from the shelves of American markets. The human impact is the most overlooked component of the media story. 

 Hostess is iconic. It is arguably one of the most recognized brands in America, and one with a noble mission - to feed people. The tragedy is that this didn't have to happen.  It happened because the brand lost its way; it forgot its mission and ignored its customers.  And now it is relegated to a footnote of American pop culture history.

 In a culture that is suffering from an epidemic of obesity and lifestyle-induced diabetes, how is it possible that a company that made sweet things can't make ends meet?  Ask yourself: what companies today are still selling product offerings, unaltered, from 40 years ago?  Precious few.  Did the product developers and marketers utterly fail in their job?  Without a doubt.  But this is still not the real tragedy here.

 The real tragedy is that Hostess had a huge opportunity (and an even larger responsibility) to re-brand itself and deliver the kind of product that was transformative, not just to its bottom line, but to the American people.   Today's consumers are smarter and more empowered than ever before, engaged in an endless dialog with other consumers and with retailers about the value of what they consume. The company's leaders ought to have seized that power of insight and used it to design and deliver an entirely new line of foods that were compelling in value and nutritional worth.  They ought to have reached out to its decades of customers and made them a promise, a commitment to feed them, and to feed them something they would both enjoy and benefit from.  People respond to that kind of statement - especially from a name they know as well as their grandparents.  Its bold.  Its customer-first.  Its compelling.  Its what the food-blind consumer public desperately needs.  And its what Hostess didn't do.  That's the true loss. 

 Companies must always remember that they exist to serve the public they profit from.  Lose your way, refuse to change, ignore the customer, and you will fail.