Mega-Branding: The Purple Oreo Problem

In Decoy Marketing, I described my befuddlement when staring at a shelf full of shaving gel product variations. In that case, a jumbo-sized can at the same price as the regular-sized cans put an end to my indecision. It turns out I’m not the only marketer with an eye on the shaving gel shelf. In The Pitfalls of Megabranding – Consumers Don’t Necessarily Want More Choice, Ad Age’s Al Ries notes, “Edge shaving gel now comes in 13 different varieties, some of which have exceedingly long names like Edge Active Care Shave Gel Natural Cool, with Eucalyptus.”

A key conclusion of Ries’s post is that the proliferation of brand variants is leaving less shelf space for the best-selling original product, in turn leading to stockouts and lower sales, not to mention dilution of the original brand. Here’s a quick scorecard on how popular brands are exploding:

Tostitos – 11 varieties
Wheat Thins – 11
Gatorade – 23
Goldfish – 16

Does the market really need 16 flavors of Goldfish crackers, including “Blazin’ Buffalo Wing Flavor Blasted Goldfish?”

46 Kinds of Oreos – Including Purple

Ries didn’t include my favorite example of branding excess in his post: Oreo cookies. The Nabisco website lists 46 varieties of Oreo products, almost all sandwich cookies with different stuff in the middle or different cookie-halves to contain the stuff in the middle. Some of these products may well be sensible: Double Stuf (with twice the frosting) is no doubt a popular variant. Some of the more unusual ones include “Chocolate Sandwich with Organic Sugar and Flour” and, of course, “Spring Purple Creme.” For those who can’t decide if they like chocolate or vanilla better, a “Duo” variety uses one of each cookie to form the sandwich. (Unfortunately, it doesn’t look like they have introduced that one with the optional purple frosting yet.) There’s also the cryptically-named “Golden Uh-Oh with Chocolate Creme.”

Mega-branding’s Mega-Problem

In addition to the inventory issues and potential loss of brand focus that Ries highlights, I’d add one other problem: behavioral research shows that too many choices reduce sales. In More Choices, Fewer Sales, I described research which showed that consumers presented with a large number of choices made only a tenth as many purchases than those with just a few:

A 2000 study at Columbia University compared consumer behavior when confronted with a selection of either six or 24 gourmet jams in an upscale grocery store. The bigger selection did indeed cause more customers to stop and check it out – 60% vs. 40% for the limited selection. The interesting part, though, was the purchasing behavior. While 30% of the customers presented with the limited selection made a purchase, a mere 3% of those who saw the extensive selection bought something.

How different is the research setting – a couple of dozen gourmet jams – from 16 varieties of Goldfish? Or a shelf unit full from top to bottom with different Oreo variations? I think it’s very possible that even as these mega-brands garner more shelf space, they could be selling less total product than had they focused their efforts on a few key varieties.

To top it off, despite their 46 varieties, Nabisco still hasn’t introduced the Oreo variation I’d find most appealing: pre-opened Oreos, minus the cookie half that the creamy filling didn’t stick to. ;)

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— who has written 957 posts on Neuromarketing.

Roger Dooley writes and speaks about marketing, and in particular the use of neuroscience and behavioral research to make advertising, marketing, and products better. He is the primary author at Neuromarketing, and founder of Dooley Direct LLC, a marketing consultancy. Follow him on Twitter.

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6 responses to "Mega-Branding: The Purple Oreo Problem" — Your Turn

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Prentiss Riddle 18. August 2008 at 1:07 pm

I’ve heard the claim that this phenomenon isn’t meant to appeal to consumers so much as to crowd out the competition. More linear feet of shelf space for Nabisco means fewer for Pepperidge Farms and Little Debbie.

The question of whether and how this strategy can backfire is an interesting one. It might be subject to a lot of variables. Maybe there are product categories in which a huge selection is appealing (I’m thinking wine) and others in which it is just annoying (toilet paper). Maybe there are product categories for which consumers don’t want to pay “gourmet” prices and a smaller selection subliminally implies more basic products and a more affordable price (this could be going on with the jam). And maybe there’s a difference in how the effect works for household names vs. unknown brands (46 varieties of Oreos may evoke the power and the glory of the Nabisco empire, whereas 46 varieties of Joe’s No-Name Cookies would just seem bizarre).

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Roger Dooley
Twitter: rogerdooley
18. August 2008 at 2:03 pm

All good points, Prentiss. Locking up shelf space is no doubt a consideration (although, depending on the venue, Nabisco may have to pay for that space). It would be interesting to compare (in different stores with similar demographics) how the same shelf space with an abundant selection of a few varieties would compare in revenue to the same space with dozens of variations. (In one supermarket I frequent, Oreos take up one shelf section from floor to out-of-reach.)

Roger

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Marc Rapp 21. August 2008 at 10:40 pm

I think its a little more simplistic then this. And the problem revolves more around the issue of *time and how much someone has to make a choice. Most retail environments are designed for quick response and the fabled *impulse buy, whereas in this case, as Prentiss mentioned, it’s a competitive strategy. Faced with indecision, consumers will look for what was recommended through WOM or a previously purchased name brand. Given *time, most will look for the deal followed by the newest brand-to-shelf. In contrast, from a retail packaging standpoint, you want your packaging to stand out and claim it’s space.

In the case of the Oreo picture above, it’s clearly become visual noise. And the only take-away thought is: Oreo. Not *Chocolate Cookie, or Vanilla-something-or-other. The brands are hurting themselves. Even if its an attempt to slowly phase products out of shelf space, it only causes the prospect to become disoriented.

Retail environments are in desperate need change and an evolution. I think we’ll see a more concentrated effort in revisiting and exploring selling-spaces in the next few years as they may become more valuable if treated as social spaces.

Great post, as usual.

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Roger Dooley
Twitter: rogerdooley
22. August 2008 at 6:44 am

Thanks, Marc – you make good points. I think it would be an interesting test to devote the same Oreo shelf space taken up by so many varieties and replace it with a creative display showing only a few top-sellers. It wouldn’t surprise me if it got more attention and outsold the current setup – without all the SKU hassles!

Roger

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Rich and Co.
Twitter: richandcom
25. January 2011 at 6:08 pm

Strongly disagree with the statement: “…marketers should never assume they know what is going to work..”

These results follow both evolutionary and neuroscience evidence that is old and well established. Increased male risk-taking and giving less attention to immediate financial rewards in favor of impressing a potential mate is behavior found in other social animals as well.

Even if the man has a mate already, these reflexes and deep brain systems are very, very old and powerful. This kind of triggering may also increase as men age due to cognitive normal declines and increased disinhibition.

One could further argue that the point of money for men is:
- To impress potential mates
- To compete with other men for mates, i.e., “dominance”

If basic mating triggers don’t work for marketers — what will. Obviously not abstract mathematical and economic ones.

The next logical and interesting step is to segment out the males who responded by testosterone levels and other genetic traits. Visual acuity? Social skills, etc.? Finger length is a good indicator of inherited testosterone levels.

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Roger Dooley
Twitter: rogerdooley
25. January 2011 at 6:20 pm

My point wasn’t that marketers don’t know any thing about consumer behavior, Rich & Co, but rather that every situation is different. The best marketers in the world test, test, and test to see if what they think might work better is actually able to outperform their control.

Roger

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