Jon Malankar (EC) asks about the real price of Lay’s move to crowd-source its product innovation
The votes have been tallied. A victor has been chosen. The winner of the Lay’s Do Us A Flavor contest for 2015 is…Southern Biscuits and Gravy! After receiving millions of submissions from consumers all over the U.S., and after logging millions more votes on Facebook for the four finalists, Lay’s has its newest flavor. And one with an established fan following, to boot.
That process certainly sounds much better than the traditional, out-dated approach of trend watching, focus grouping and taste testing. Lay’s has leveraged the crowd in the simplest yet most effective way to source new flavors. But letting Millennials in on the proverbial sausage-making could lead to questions about more than just flavors.
Want to know what consumers want? Just ask, and offer prizes
Lay’s Do Us A Flavor began outside the U.S., first gaining popularity in the United Kingdom with classic flavors like Scottish Haggis and, ironically, American Cheeseburger. The concept is simple. Any consumer can submit a flavor suggestion. A group of brand representatives and foodies choose 10 top flavors. Frito-Lay food scientists mock up sample chips and three to four finalist flavors are chosen. Consumers then get to vote on the finalists to choose a winner. The person who submitted the winning entry gets one million dollars or one per cent of sales from the first year, whichever is higher.
Lay’s is not the first to go this route. Sam Adams and Arizona Iced Tea both made attempts but neither brought the same social media might of Lay’s. Do Us A Flavor launched in the U.S. in 2013 with celebrity endorsers Iron Chef Michael Symon and actress Eva Longoria. Entertainer and restaurateur Nick Lachey took center stage for this year’s contest. The Lay’s Facebook page is teeming with Do Us A Flavor content for the almost seven million people that have liked the page. To date, this promotion has stretched across 14 countries and collected more than 25 million submissions.
We can safely say this has been a success, so far. The campaign has brought in millions of impressions on social media and won industry awards for innovation and creativity. That said, Lay’s Do Us A Flavor could be setting a dangerous precedent of consumer engagement that might soon reach too far for comfort.
Invite Millennials inside and they may never move out
Do Us A Flavor launched in the U.S. to re-engage Millenials, who had effectively forgotten about Lay’s. Frito-Lay Chief Marketing Officer, and architect of Do Us A Flavor, Ram Krishnan told Ad Age “Consumers have gone from being passive to active, highly engaged consumers. These are like venture capitalist consumers. They actually want to spend their time giving feedback on the products.”
Venture capitalist consumers sound challenging enough. But what if they one day become activist consumers? Perhaps having a say on the next Lay’s flavor won’t be enough and consumers will demand a steep reduction in sodium. Or only responsibly grown potatoes. Or vegan chips with no preservatives. This might sound far-fetched, but we’ve already seen examples of consumer activism forcing large companies to change course.
Take a look at Nike. Well before Facebook and Twitter gave all consumers a digital megaphone to make their voices heard, Nike came under fire for labor malpractice in their factories. The 1990’s global boycott of Nike forced the company to clean up its supply chain. Later in 2001, one passionate consumer, now-Buzzfeed CEO Jonah Peretti, launched a campaign with a provocative user ID to continue the movement. No doubt this case of consumer activism led to positive outcomes for society, but it also cost Nike a ton.
If apparel seems to unrelated, then look inside PepsiCo at Gatorade. In 2013, a 15-year old named Sarah Kavanagh successfully launched a war against Gatorade over the use of brominated vegetable oil (BVO). She started a petition on Change.org and quickly found herself on morning talk shows pushing her cause. To be clear, the actual research on BVO is inconclusive at best, and PepsiCo’s products were in line with FDA regulations. Even still, PepsiCo had to take action to remove the ingredient all together because one outspoken teen decided to speak out.
Walking a tightrope
Consumer packaged goods companies walk a fine line every day. They must delight consumers to get close to their hearts. At the same time, firms must keep consumers at arm’s length to maintain control. Campaigns like Do Us A Flavor fundamentally rewrite the contract between companies and consumers. The consequences of that new contract have yet to be determined. When Ad Age asked Krishnan about the drawbacks of having such a close relationship with consumers, Krishnan replied “Sometimes you don’t like their feedback”. If the past is any indication, not liking consumer feedback might be least of their worries.