Out of the Box

Turning Lemons into Lemonade

By Menachem Lubinsky on March 23 2007

I recently observed some old furniture waiting to be picked up the next morning by the Sanitation Department. By daybreak the dresser and a small table were gone. What was destined to be grinded up by a garbage truck probably ended up with a new coat of paint and a glossy finish and sold as antique furniture. A friend of mine collected campaign buttons and was recently told by a collector that his 50 or so buttons, some going back some 60 years, were worth over $20,000. Old cars that could not fetch a buyer 30 years ago are now on the market as priceless antique cars and so forth.

I like to think of the above examples as much more than simply recycled marketing opportunities. They are creative ways of turning “lemons into lemonade.” Many a business is faced with the possible obsolescence or decline of their products. It may very well be that the product is headed for oblivion due to circumstances that are beyond the control of the business. With the demise of the typewriter, what purpose would there be to continue producing typewriter ribbons?

Food companies face similar dilemmas on a regular basis. When sales of frankfurters plummeted due to publicity about the ill effects of Monosodium Glutamate (MSG), the industry adjusted and produced hot dogs without MSG. The same was true for reduced fats, carbs and so forth.

More recently, there has been a growing national concern about obesity, particularly in children. One of the culprits, experts say, is carbonated beverages or soft drinks. For the giants like Coca-Cola and PepsiCo it meant a drop in sales in some markets. They had already been on a major campaign to diversify into many non-traditional products, like water and non carbonated drinks. But they still had to deal with the fact that their main “bread and butter” products were taking a beating in the media and with the public. They were also watching a new category of more healthful power drinks and juices take market share from them.

Coca Cola and PepsiCo decided they had to act, announcing that they would soon come out with a new generation of healthier soft drinks. They announced that they would be adding vitamins to their carbonated beverages in an effort to appeal to health-conscious consumers. The New York Times reported that the new Diet Coke Plus and PepsiCo’s Tava will be promoted as "sparkling beverages" instead of "soft drinks." Tava will contain vitamins B3, B6 and E, and chromium, while Diet Coke Plus will contain niacin, vitamins B6 and B12, magnesium and zinc.

Michael F. Jacobson, executive director of the Center for Science in the Public Interest, says the new beverages "are certainly a lot better than a regular soft drink" but said consumers are better off getting their nutrients from natural foods, rather than fortified soft drinks, the Times reported.

So this is how the mega beverage companies will be making lemonade from lemons. They will follow another adage which says “if you can’t beat them, join them.” The move is already being touted by several marketing publications as “an ingenious way of dealing with change.”

Sometimes companies are too quick to throw in the towel, opting for diversification rather than coming up with a creative way to salvage a core product. They hire high-priced consultants to come up with the new idea, while there may be an obvious answer with an existing product. For example, a yogurt company that found itself removed from the list of approved products in a popular weight-reduction program decided to reformulate their ingredients, thus reducing the fat and caloric content. The new product had a big 80 (for the number of calories) across the front of the label. Weight Watchers put it back on the list.

With the low interest rates that banks were paying just a few years ago, a bank in the Western United States began to feel the pinch. They found it difficult to attract new depositors and its overall deposits fell dramatically creating somewhat of a panic with shareholders. The bank began to offer services that were more fitting for a five-star hotel. It even added a concierge to the front of its main branch, a café, and a free financial consulting service. The depositors returned.

Coke and PepsiCo may very well find a unique response from customers: “thanks but no thanks.” They will in essence be saying that they expect the two beverage giants to continue producing what they’re best known for, but Coke and PepsiCo will be trying to create an image that they now produce health conscious products, joining the health and wellness revolution of our day.

The realization that something may have become or is on its way to being a lemon can happen to every business. The challenge is to recognize that change is in the air. It is important to keep an ear to the ground and when it appears that something may be turning into a lemon, to quickly turn it into lemonade.

I recall hearing about a shoe repair store that had an enormous stock of shoelaces. It would take many decades of changing shoelaces to use up the inventory he had, which he had inherited from his grandfather who founded the business. One day the store featured a new sign: “We sell lanyards.” Now that’s lemonade!

Out of the Box is a collection of strategic marketing articles that Lubicom has published on various topics, trends and ideas in the marketing world. The articles have been published in the Hamodia weekly newspaper circulated on three continents to a readership of well over 100,000.

The name, "Out of the Box" is a term used frequently in business nowadays to describe creative thinking that is not the norm. It is meant to help a business pull away from the pack or separate oneself from the competition. It is to some extent fraught with risk, simply because it is not the run of the mill thinking, but it is at the same time the key to reaching the next opportunity.