Speaker 1: Bloomberg Audio Studios, Podcasts, Radio News.
Speaker 2: Hello and welcome to another episode of the Odd Blocks podcast.
Speaker 3: I'm Joe whysn't Thal and I'm Tracy Alloway.
Speaker 2: Tracy, we like to talk about snacks and drinks and
Speaker 2: stuff on the show, and you know, it's kind of
Speaker 2: just how that we're interested, But I actually think that,
Speaker 2: like there's like a deeper fundamental reason by why we
Speaker 2: keep coming around to this topic.
Speaker 3: Wait, it's not just because we like snacks.
Speaker 2: I mean, that is the deep, deep, deep reason. But
Speaker 2: the other reason is, Ah, I kind of think I've
Speaker 2: been thinking about this lately that like the proliferation of
Speaker 2: different types of snack foods and beverages and energy drinks
Speaker 2: which multiply like crazy and store aisles. It's like the
Speaker 2: ultimate story of like capitalist success and like the consumer
Speaker 2: economy that we just keep getting this like endless permutations
Speaker 2: of like great flavors in different ways to consume these flavors.
Speaker 2: It's like the pinnacle of the consumption economy.
Speaker 3: Okay, Well, I would say, I guess capitalism, Well, capitalism
Speaker 3: has to have some upsides, and I guess a loaded
Speaker 3: flavored Cheetos are one of them. That's fair I do
Speaker 3: think what's interesting to me about this moment in snacks
Speaker 3: is there seems to be sort of two things going on,
Speaker 3: like two mega trends, the very early beginnings of two
Speaker 3: mega trends. So one is the idea of what's going
Speaker 3: to happen to snack food in a GLP one fueled world.
Speaker 3: And we touched on this a little bit last year
Speaker 3: when we spoke to James van Kielin and he was
Speaker 3: talking about his ozembic and GLP one investment thesis. And
Speaker 3: I really like speaking to him because it wasn't just
Speaker 3: like all the companies that are making these drugs are
Speaker 3: going to see their share prices absolutely surge. It was
Speaker 3: also there are going to be these second order knock
Speaker 3: on effects on some consumer companies. And you could see
Speaker 3: that playing out a little bit last year. You can
Speaker 3: certainly see it playing out now. I think almost every major,
Speaker 3: you know, food and beverage company that reported in the
Speaker 3: most recent quarter had AGLP one or ozembic related question.
Speaker 3: And then I guess the other mega trend is just
Speaker 3: this idea of companies having to become more and more
Speaker 3: creative to also drive consumption. So you have to have
Speaker 3: more flavors in order to grow your market share, to
Speaker 3: keep people engaged and interested and posting pictures of your
Speaker 3: food on TikTok or Instagram.
Speaker 2: Or whatever totally, and you just see this play out.
Speaker 2: I don't know. This is why I go back, you know,
Speaker 2: I think about those sort of famous or infamous and
Speaker 2: maybe apocryphal things where it's like some Soviet leader came
Speaker 2: to the US, it's a grocery store. It's like, Okay,
Speaker 2: capitalism is the answer. Maybe there was something, but it
Speaker 2: really does feel like we're sort of at this moment
Speaker 2: where these maybe almost two mega trends are in competition
Speaker 2: with each other, right because there is this seemingly race
Speaker 2: to provide more flavor and more variety and more versions
Speaker 2: and special versions and stuff like that, and then the
Speaker 2: sort of looming threat to the sort of traditional way
Speaker 2: of doing business from the GLP ones Lego Zembic. So
Speaker 2: there is never too much snack food and there's never
Speaker 2: too much conversation about snack food.
Speaker 3: Well, the other thing that I just remembered, I totally
Speaker 3: agree you can never have enough snack food. But the
Speaker 3: other thing was the conversation we had with Ryan Harlan
Speaker 3: where he was talking about the technology that's now going
Speaker 3: into producing these snack foods, and also AI nowadays. So
Speaker 3: this idea that you can basically model a virtual manufacturing
Speaker 3: line for a new flavor, you can use AI maybe
Speaker 3: to come up with new flavors. So it seems like
Speaker 3: all of foods is getting more sophisticated. And some of
Speaker 3: it is, of course in response to good old fashioned
Speaker 3: consumer demand give the customer what they want. But part
Speaker 3: of it, also, I have to think, might be in
Speaker 3: response to competition from GLP one and ozepic and the
Speaker 3: idea that well, if we're going to eat less food overall,
Speaker 3: then maybe the way to keep customers is to make
Speaker 3: sure that food is really really interesting.
Speaker 2: Yeah good, I'm glad you brought up the Ryan Harlan
Speaker 2: episode because right that was about the sort of supply
Speaker 2: side innovations that allow companies like say A for you
Speaker 2: Delay to try more limited run lines and move things
Speaker 2: faster and get a you know, you have a theoretical
Speaker 2: test flavor, you can make a chip faster anyway. So
Speaker 2: that raises the question where does the flavor come in
Speaker 2: the first place. When there is a new chili lime
Speaker 2: or a new Durian flavored.
Speaker 3: Sto, are we going to Flavortown?
Speaker 2: We're going to say we're going to We're going to
Speaker 2: flavor Toown. I hadn't thought we're not. Who's the chef
Speaker 2: that we're not talking to that chef? Well, we do
Speaker 2: have the perfect guest because it's someone who is in
Speaker 2: the business of great flavors. We're going to be speaking
Speaker 2: with Barb Stucky. She's the chief innovation and marketing officer
Speaker 2: at Madsen, which is a Silicon Valley based food and
Speaker 2: beverage innovation company. She has written a lot about what
Speaker 2: makes great flavors, and she has studied a lot about
Speaker 2: this moment in flavor history. So, Barb, thank you so
Speaker 2: much for coming on outlaws.
Speaker 4: Well, thank you for having me.
Speaker 2: What do you do the chief innovation and marketing officer
Speaker 2: at Madson? What do you do in the flavor world?
Speaker 4: Oh? What don't we do in the big flavor world?
Speaker 4: So the company's been around for about forty seven years,
Speaker 4: and over the course of those decades, we have worked
Speaker 4: in pretty much every food and beverage category that exists,
Speaker 4: with the exception maybe a beer okay, but we work
Speaker 4: on everything from baby food to alcoholic beverages to frozen
Speaker 4: trace to confections, to dietary supplements. And we also do
Speaker 4: work in the restaurant channel, so we work mainly for
Speaker 4: national and global restaurant chains, but we help them identify
Speaker 4: new menu categories and new menu items. So we are
Speaker 4: really all over one hundred percent share of stomach is
Speaker 4: how we like to sit.
Speaker 2: I like stomach share. I've never heard that. I've never
Speaker 2: heard that one before, but that makes sense.
Speaker 3: So one thing I was wondering is the basic premise
Speaker 3: of this conversation. I mentioned gop one drugs earlier, and
Speaker 3: this is something that has come up in various forms
Speaker 3: on the podcast and also on various earnings calls. As
Speaker 3: I mentioned, Is this something that's on your radar as
Speaker 3: a chief innovation officer in the food industry.
Speaker 4: Yes, absolutely, it's very much on our radar, and I'll
Speaker 4: tell you how this happened. So you know, we work
Speaker 4: in food and beverage. We are not in the pharmaceutical
Speaker 4: and so we started getting some questions from our clients,
Speaker 4: who ranged from some of the largest global CpG companies
Speaker 4: to small founder funded startups, and they were asking questions
Speaker 4: about these new drugs and what's going to happen and
Speaker 4: should I be worried about this? And this was about
Speaker 4: middle of twenty twenty three. So in the fourth quarter
Speaker 4: of twenty twenty three, we decided that, because of our
Speaker 4: position in the industry where we do work across companies
Speaker 4: and we work across categories, that we were going to
Speaker 4: educate ourselves and we were going to make ourselves as
Speaker 4: smart as we can about this topic, and we were
Speaker 4: going to then put forth the learnings that we gained
Speaker 4: and share them with the industry. So we just did
Speaker 4: that in a webinar format. It works like this, so
Speaker 4: we handled it as we would do a client project.
Speaker 4: So we started reading secondary resets that was out there.
Speaker 4: There was a great report from Morgan Stanley that enabled
Speaker 4: some of our learnings. And then we have a consumer
Speaker 4: panel at Matson, So these are just consumers who have
Speaker 4: been willing to give us their feedback on new ideas
Speaker 4: and products, and we surveyed the panel to see if
Speaker 4: anyone in our panel was on ozembic or some of
Speaker 4: the other medicines we call them aom's anti obesity medications,
Speaker 4: and we found out that there was about one hundred
Speaker 4: and twenty five people who were either on the drugs
Speaker 4: or had been on the drugs. So all of a sudden,
Speaker 4: now we've got a patient population that we can talk
Speaker 4: to to understand more. So we started doing that. We
Speaker 4: put a survey in front of those consumers and got
Speaker 4: to learn a little bit about what they were experiencing
Speaker 4: and how things were changing for them. We also talked
Speaker 4: to medical practitioners, so we talked to doctors, we talked
Speaker 4: to practitioners, we talked to people who were prescribing the AOMs.
Speaker 4: And then we did a lot of work with our
Speaker 4: proprietary AI models to talk to AI personas to see
Speaker 4: what was what was resonating with them, and that was
Speaker 4: super interesting as well. And then the last thing we did,
Speaker 4: which I can tell you more about, is we created
Speaker 4: some new food and beverage concepts, some new ideas. They
Speaker 4: ranged from beverages to snacks to meals, and we tested
Speaker 4: those ideas with our patient panel of humans. I should
Speaker 4: say we did test them with humans, not our AI,
Speaker 4: which we can do, but we didn't do. So we
Speaker 4: have so much data, so much to share.
Speaker 2: So let's start with some of that before we get
Speaker 2: to the new concepts. What did the one hundred or
Speaker 2: so people in your panel who are on the AOMs
Speaker 2: tell you about their experience and how changed their relationship
Speaker 2: with food and beverages.
Speaker 4: Yeah, it's a great question. And just to clarify, our
Speaker 4: sample size ended up being about seventy five Okay, so
Speaker 4: seventy five those patients, so some of them dropped off.
Speaker 4: But what we heard from patients is that most of them,
Speaker 4: the vast majority of them, were extremely satisfied or positive
Speaker 4: with their experience on the drugs. And this is interesting
Speaker 4: because many of them reported having side effects. It just
Speaker 4: goes to show that it's so hard to lose weight
Speaker 4: through typical strategies, you know, a combination of diet and exercise.
Speaker 4: Some of our panelists had even had previous weight loss
Speaker 4: surgery for example, but other interventions. And they were also
Speaker 4: just really pleased with these drugs as giving them success
Speaker 4: that they were unable to have or unable to sustain
Speaker 4: using other methods. So that was really interesting to us.
Speaker 4: So it does seem that these things are these drugs
Speaker 4: are working incredibly wealth for people, not everyone. A lot
Speaker 4: of the side effects are continual and a small number
Speaker 4: of people do have them, but you know, they can
Speaker 4: be really unpleasant in terms of GI. And one of
Speaker 4: the ways that these drugs work is that it's hormonal.
Speaker 4: But they also happened to slow your your gastric emptying,
Speaker 4: meaning the food stays in your stomach longer and so
Speaker 4: you feel full longer, which also happens when you have
Speaker 4: weight loss surgery, your stomach is actually reduced in size,
Speaker 4: but with these drugs, it's not reduced in size, but
Speaker 4: it feels that way because the food stays in there longer,
Speaker 4: and so people really really cannot overeat. They told us
Speaker 4: really horrific story of overeating and getting sick because it
Speaker 4: was just nauseating. Also, there are problems at the other
Speaker 4: end of the GI track two. A lot of people
Speaker 4: reported constipation or diarrhea other things like that. So these
Speaker 4: are not without their challenges and not without their side effects.
Speaker 4: But for the vast majority of people, they were extremely
Speaker 4: happy and we're losing significant amounts of weight. The other
Speaker 4: thing is that we did notice in our survey that
Speaker 4: a lot of people were having some pretty significant changes
Speaker 4: in their food and beverage behavior, and that was ultimately
Speaker 4: our goal for this study.
Speaker 3: So what did you see in terms of food preference?
Speaker 3: Because when I go on a diet and I restrict calories,
Speaker 3: I usually end up this is terrible, this is not
Speaker 3: how you should diet. But I usually end up replacing
Speaker 3: healthy meals with like Oreo cookies, and I just eat
Speaker 3: like three Oreo cookies instead of having a larger meal.
Speaker 3: Does that hold out for ozembic people as well, or
Speaker 3: people who are on ozembic and the other AOMs. Do
Speaker 3: they still eat junk food just maybe less of it,
Speaker 3: or do we see a change in their food preferences.
Speaker 4: You know, it definitely depends on the person. But more
Speaker 4: people than not did say that all of a sudden
Speaker 4: they were not craving things like sugary sodas or salty
Speaker 4: snacks or animal proteins. So, especially for some reason, beef,
Speaker 4: people were really turned off by the idea of beef,
Speaker 4: and so they were instead sort of veering in the
Speaker 4: direction of fruits and vegetables, things that were lighter in
Speaker 4: flavor and lighter on the stomach. So you know, they
Speaker 4: were really trying to satisfy those cravings. We even we
Speaker 4: did some one on one video interviews, and I remember
Speaker 4: distinctly this one went talking about how, you know, I
Speaker 4: used to crave chips and now I crave cucumbers and parrots,
Speaker 4: and she said the flavor of a crisp cucumber is
Speaker 4: just so tantalizing, And I'm thinking to myself, while tantalizing cucumber,
Speaker 4: I mean, that is a significant change in cravings and
Speaker 4: you know, and the resulting caloric intake. So it does
Speaker 4: seem to be doing something akin to teaching people how
Speaker 4: to eat healthy, which is crazy that a drug can
Speaker 4: do this, but it's that seems to be the case
Speaker 4: with a lot of people.
Speaker 2: It's pretty incredible. But it also has an interesting implication
Speaker 2: because I think like sort of one cynical expectation is that, Okay,
Speaker 2: people don't want to eat salty chips as much anymore,
Speaker 2: so then the food industry is going to respond by, oh, well,
Speaker 2: we're just going to put even more salt in the
Speaker 2: chips and will make it even more tantalizing and it'll
Speaker 2: make it even harder for people to resist. But it
Speaker 2: sounds like from your research that that will just make
Speaker 2: the end products even more repellent to people.
Speaker 4: I think you're absolutely right. Yes, we heard people really
Speaker 4: really just turning their nose up at certain foods that
Speaker 4: they used to love and it's really odd, but I
Speaker 4: do think that's what would happen. So, you know, a
Speaker 4: lot of them were they were cutting from their diet
Speaker 4: in the neighborhood of a thousand calories a day, Well,
Speaker 4: that's crazy, Like for most people, that's half of the calories,
Speaker 4: are a third of the calories that you're consuming. So
Speaker 4: you know, that results in you having to make decisions
Speaker 4: about what is going to be my calorie consumption based
Speaker 4: on the fact that it is so much less. I'm
Speaker 4: really to make those calories count. And so you know,
Speaker 4: that just gets at the fact that you know, I
Speaker 4: think you said at the beginning, like people want interesting food,
Speaker 4: people want delicious food, in the case of the folks
Speaker 4: that we heard from, just a lot less of it.
Speaker 3: Well, where does that leave, say a potato chip maker,
Speaker 3: because it seems like if people aren't craving salty food anymore,
Speaker 3: it seems unlikely that a maker of potato chips is
Speaker 3: going to suddenly substitute their offerings with something like cucumbers.
Speaker 4: Absolutely, you're totally right. I cannot imagine that happening. Of course,
Speaker 4: it takes a different distribution channel and different buyers in
Speaker 4: the grocery store and yeah, that's not going to happen.
Speaker 4: But what you know, we're in the innovation business, and
Speaker 4: so what you could see potentially happening is that these
Speaker 4: makers of chips, for example, what would create portion sizes
Speaker 4: that are much smaller. Perhaps instead of increasing the sodium,
Speaker 4: they reduce the sodium. Perhaps they do chips that have
Speaker 4: some vegetables blended into their tortilla chip dough something like that,
Speaker 4: to give it a little bit more fiber, to help
Speaker 4: with the gi stuff, to give it a little more
Speaker 4: nutrient density. So, you know, this could be an opportunity
Speaker 4: for the food and beverage industry to really reset things
Speaker 4: and reset expectations. You know, if you think back to
Speaker 4: the size of a snack bag thirty years ago, or
Speaker 4: the size of a hamburger thirty years ago, or the
Speaker 4: size of a bagel, you know, they were all so
Speaker 4: much smaller. So this is an opportunity for us to
Speaker 4: go back to those sizes as expectations and really help
Speaker 4: the entire country eat better. I don't know if that's
Speaker 4: going to happen. Maybe it's a little pie in the sky,
Speaker 4: but these are the kinds of things we were trying
Speaker 4: to educate the end a story about because there are
Speaker 4: some new opportunities.
Speaker 2: So you mentioned coming up with some new food concepts
Speaker 2: or flavor concepts and actually serving them to your non
Speaker 2: AI panelists. What are you cooking up there and what
Speaker 2: resonated with people?
Speaker 4: Okay, well, I have twenty two products that we came
Speaker 4: up with and tested. Not all of them scored well.
Speaker 4: For example, the one that we created that was about
Speaker 4: trying to tame nausea with ginger. That one bomb bomb Okay,
Speaker 4: totally good.
Speaker 2: To bomb early before a nationwide launch, I guess.
Speaker 4: So, yeah, yes, that is so true that that's why
Speaker 4: we do these kinds of us. Yeah. So essentially what
Speaker 4: we were doing is writing these concepts for the AOM user.
Speaker 4: So one of the top score it, we'll give you
Speaker 4: two or three of the top scoring ideas. So one
Speaker 4: of them was a brownie cube. So this idea was
Speaker 4: ready to eat brownie. It's about the size of a nickel,
Speaker 4: but in cube shape, and it's baked with extra protein added.
Speaker 4: It's got a little bit of fiber in it from
Speaker 4: the cocoa, and it's basically kind of a one byte indulgence.
Speaker 4: And that really resonated. I think again, because when your
Speaker 4: gastric emptying thing is slowing down. You really just don't
Speaker 4: have room to eat a whole brownie.
Speaker 3: I suppose a nickel sized or byte sized brownie kind
Speaker 3: of preserves customer choice in some ways. So if you're
Speaker 3: on an AOM of some sort and you're not that hungry,
Speaker 3: you can have one byte of the brownie. But if
Speaker 3: you are not on AOMs and you are very hungry,
Speaker 3: you can, you can. You'll probably just eat like a
Speaker 3: bag full of them, right.
Speaker 4: Well, yes, And you know what that brings up a
Speaker 4: really important point, which was that all the things that
Speaker 4: rose to the top of our test were things that
Speaker 4: the whole family could enjoy, and that was an important
Speaker 4: criteria for the you know, mostly women, it's mostly women
Speaker 4: on these because they didn't want to buy things and
Speaker 4: bring them into the hot household that would just for
Speaker 4: them that their kids wouldn't eat, their husband wouldn't eat,
Speaker 4: their partners wouldn't eat. So we saw other things like
Speaker 4: these chicken strips that are grilled chicken breast that are
Speaker 4: cut into strips and then individually wrapped, and so you
Speaker 4: could imagine, you know, you're trying to get your protein,
Speaker 4: but you don't want to eat a whole chicken breast
Speaker 4: because that's just way too much. So that was our
Speaker 4: number two scoring concept, and it just makes so much
Speaker 4: sense because if you can't eat a whole chicken breask,
Speaker 4: you really probably don't want to cook one and then
Speaker 4: cut it up yourself. So this was a refrigerated product
Speaker 4: that you could you could take it out of the
Speaker 4: refrigerator and snack on it cold, or heat it up
Speaker 4: and put it in a tortilla. So things like that,
Speaker 4: you know, those represent some different format options, different packaging options,
Speaker 4: portion sizes, and then you know, we have a whole
Speaker 4: other list of stuff that seem to resonate some more
Speaker 4: than others.
Speaker 2: So it sounds like a lot of the innovation that
Speaker 2: you've worked on or that we could see coming, as
Speaker 2: you mentioned, sort of has to do with maybe foods
Speaker 2: that we're familiar with, but that in rethinking the distribution,
Speaker 2: and I have to say, I would snack on the
Speaker 2: grilled chicken strip. I would be down for that, And
Speaker 2: having like a big bag of those in my house,
Speaker 2: that actually sounds like a I would snack on that.
Speaker 2: You mentioned that the ginger infused foods sort of bombed.
Speaker 2: Were there any breakthroughs in terms of flavors or somehow
Speaker 2: recreating the sensation of a cucumber or a carrot, where
Speaker 2: the breakthrough is not in the shape or distribution of
Speaker 2: an existing thing, but in like some brand new type
Speaker 2: of flavor that really worked on the ozompic users, the
Speaker 2: AOM users.
Speaker 4: Yeah, you know, we tested a protein beverage. So this
Speaker 4: was a line of clear beverages with protein added. And
Speaker 4: that's that's a highly technical, very difficult challenge, having done
Speaker 4: it myself, Yeah, that one is a high degree of difficulty,
Speaker 4: let's just say that. But we tested this line of
Speaker 4: three and I think one of our flavors was cucumber
Speaker 4: or a cucumber line, and that actually resonated pretty well.
Speaker 4: The idea being that if you think about protein drinks
Speaker 4: on the market, they're usually chocolate, strawberry, really thick, they're
Speaker 4: very satiating. And the idea of using the clear protein
Speaker 4: in these lighter cucumber flavors and you know, other light
Speaker 4: citrus flavors was that you would appeal to the more hydrating,
Speaker 4: refreshing kind of experience but still get some protein. So yeah,
Speaker 4: I think that that is actually something that would resonate
Speaker 4: just because of the flavor because it's not chocolate or
Speaker 4: you know, even though number one scoring product was was brownies.
Speaker 4: So you said something else that made me think that
Speaker 4: the most the best, the best scoring products really were
Speaker 4: very familiar. And I think that that just gets a
Speaker 4: consumer behavior around food, because we'd like to say consumers
Speaker 4: want a foot in the familiar and taking one step
Speaker 4: out of the familiar to do to buy something really
Speaker 4: innovative is okay, but to take that second step out
Speaker 4: of the familiar is really disorienting. And so you know,
Speaker 4: if you're on a weight loss regimen and your body
Speaker 4: is doing things differently, it makes sense that the familiar
Speaker 4: stuff would score really well.
Speaker 3: Just building on this point, i'd love to hear from
Speaker 3: you what the sort of evolution of a new food
Speaker 3: product or flavor actually is like from start to finish.
Speaker 3: Do people come up with ideas for completely brand, new,
Speaker 3: foreign things and build them out from there or is
Speaker 3: it more taking something that already exists and trying to
Speaker 3: improve on it in some way? Could you maybe walk
Speaker 3: us through that process.
Speaker 4: The answer is yes, all of the above. So we
Speaker 4: have worked on things as novel as creating a roast
Speaker 4: and ground coffee without coffee beans, and that product is
Speaker 4: now in the market.
Speaker 3: And what's wade out of I have to ask.
Speaker 4: Well, you can buy it, and you know you can
Speaker 4: look at the ingredient statement, so I guess I can
Speaker 4: say it here. We actually tested well dozens and dozens
Speaker 4: of upcycled ingredients that were basically products that were either
Speaker 4: sent to animal feed or were really dis waste. So
Speaker 4: think about things like seeds and pits and yeah, exactly exactly.
Speaker 4: So where we ended up was date seeds. You know,
Speaker 4: when you get a date unless you buy the pitted kind,
Speaker 4: they have these seeds and so what we did was
Speaker 4: we roasted the seeds, we ground them, we brewed them,
Speaker 4: and then some other secret sauce that we can't talk about,
Speaker 4: but turns out that they work in credibly well as
Speaker 4: a replacement for coffee beans. So you know that I
Speaker 4: have to give credit to the company A Tomo. I
Speaker 4: want to give them a shout out. We just did
Speaker 4: some very early proof of concept and development work for them,
Speaker 4: but they have turned it into a business and it
Speaker 4: is incredible. So that that's the kind of novel thing
Speaker 4: that we might get an assignment to do. And then
Speaker 4: you know, the other things that we're getting a lot
Speaker 4: of these days is I want to do X, except
Speaker 4: that I want to make it healthier, I want to
Speaker 4: have more protein in it, I want to use clean
Speaker 4: label ingredients. And so we're i would say, reinventing favorites
Speaker 4: across a lot of categories. So you know, think things
Speaker 4: like indulgent cookies or crackers, or desserts, or you know,
Speaker 4: even meals where we're replacing a lot of the not
Speaker 4: so good ingredients with just more kitchen type of familiar ingredients.
Speaker 2: So we talked about this on a previous episode about snacks,
Speaker 2: and you know, some snack food trends come and go,
Speaker 2: but some stick around. And so for example, you know
Speaker 2: when I was a kid, you could get cool ranch chips.
Speaker 2: You can still get cool ranch chips. A hot thing
Speaker 2: these days is chili lime. Flavors seem to be everywhere.
Speaker 2: You wrote a book called Taste, Surprising Stories and Science
Speaker 2: about why food tastes good. So when I bring up
Speaker 2: cool ranch or chili lime, what is it about some
Speaker 2: of these flavors? What do they have in common that
Speaker 2: you can say that's like, yes, these flavors stand the
Speaker 2: test of time, and we'll be eating chili limes, chips
Speaker 2: in twenty years, sitting aside people who are on ams
Speaker 2: chili lime flavors, like, what do they have in common
Speaker 2: when you look look at the code of a great flavor, Well, I.
Speaker 4: Would say two words. One is complexity, and there is layered.
Speaker 4: So let's just we'll take cool ranch and pull that
Speaker 4: apart and think about it from the basic tastes. And
Speaker 4: human beings are only capable of experiencing five basic tastes
Speaker 4: on their tongue, So there's sweet, sour, bitter, salt, and
Speaker 4: new mommy, and then everything else that you get is
Speaker 4: either a texture or an aroma. So the thing about
Speaker 4: cool ranch or just ranch in general, is that it's
Speaker 4: incredibly salty and savory. And those two things together, salty
Speaker 4: and savory, and they kind of come together usually in nature.
Speaker 4: When you combine them with the sourness of the butter
Speaker 4: milk and the creaminess of the butter milk, you now
Speaker 4: have a whole lot going on. You've got creamy, you've
Speaker 4: got sour, you've got savory, you've got so and that
Speaker 4: complexity and then the other things that are layered in
Speaker 4: So now I'm talking about complexity and layering on top
Speaker 4: of complexity, so things like garlic and onion, which are
Speaker 4: also important elements to a really interesting ranch profile. So
Speaker 4: you know that, I think that really makes up a
Speaker 4: lot of those classic flavors. So if we do the
Speaker 4: same thing for a chili line, most of the chili
Speaker 4: lime seasonings like something like a taheen you're familiar with.
Speaker 4: It's not just chili and lime, but it's chili, lime
Speaker 4: and salt, and so you know, again, let's go back
Speaker 4: and sort of break it apart. So you've got the salt,
Speaker 4: which is one of the basic tastes, and you've got
Speaker 4: the chili, which is actually a texture that that heat.
Speaker 4: But the slight heat that you get is working on
Speaker 4: the same nerve that detec pain, so that is a texture.
Speaker 4: So you're getting pain from the chili, you're getting salt
Speaker 4: from the salt, and you're getting sour from the lime,
Speaker 4: and that is a lot of complexity going on. Now
Speaker 4: you also have to layer on that. There's some aroma
Speaker 4: that sort of smoky maybe dusty aroma from the chilis,
Speaker 4: and the lime has got its limy citrusness and those
Speaker 4: are aromas. So those two flavors that you caught out.
Speaker 4: There's a really really complex and they're very much layered,
Speaker 4: and the way that you experience them happens over time.
Speaker 3: Joe, I'm so hungry.
Speaker 2: I know this, I need this right. I haven't eaten
Speaker 2: yet either. Yeah, so now I'm going to devour my life.
Speaker 3: This is exactly what happened when we spoke with Ryan
Speaker 3: Harlan as well. Okay, well, I'm curious what you think
Speaker 3: makes a flavor or a food suddenly go viral. And
Speaker 3: we've seen various examples of this in recent years. I think,
Speaker 3: especially during the pandemic, everyone was stuck at home looking
Speaker 3: maybe for new recipes to do, and you would see
Speaker 3: something that looked really good on TikTok and so you
Speaker 3: would try to do it. But is it about a
Speaker 3: particularly innovative flavor or is it maybe you know, doing
Speaker 3: something slightly new with food that you're already familiar with.
Speaker 4: I think it's probably both. I mean that example of
Speaker 4: you know, sitting at home during the pandemic and looking
Speaker 4: for new recipes, I think that is pitomized by the
Speaker 4: Feta pasta phenomenon. And I'm sure if you if your
Speaker 4: listeners were on TikTok or if anyone remembers the TikTok
Speaker 4: Feda pasta was just this enormous phenomenon, and that was
Speaker 4: in twenty twenty. If you fast forward. What's so fascinating
Speaker 4: about that is that feta is now everywhere. If you
Speaker 4: think about in twenty nineteen and before, feta pasta had
Speaker 4: one roll and that was on a Greek salad and
Speaker 4: that's where you would find feta and nowhere else in
Speaker 4: the US. Nowadays, not only can you find feta everywhere,
Speaker 4: but you can go to the frozen food section of
Speaker 4: your grocery store and you can buy feta pasta that's
Speaker 4: clearly just developed and positioned to mimic that recipe that
Speaker 4: was done online. And then I guess the second answer
Speaker 4: to that question is what was really unique about the
Speaker 4: way that the I believe she was finished the Finnish
Speaker 4: woman cooked that that she took a whole block of
Speaker 4: feta and just put it in the plate and put
Speaker 4: raw tomatoes in with it and threw it in the oven,
Speaker 4: and it just it seemed very novel because you put
Speaker 4: an entire block of cheese in and it seemed really easy.
Speaker 4: And so you know, those two things in combination are
Speaker 4: pretty powerful.
Speaker 2: How quickly can that happen. So you're at a consumer
Speaker 2: package goods company and your marketing team, or maybe you
Speaker 2: at Mattson or someone says, you know, what, Feta's going
Speaker 2: viral and we need a feto play or whatever it
Speaker 2: is these days, how quickly can you go from Feta
Speaker 2: is viral to let's have a frozen Feta pasta bake
Speaker 2: in the freezer aisle.
Speaker 4: Well, it's a good question, and it depends on a
Speaker 4: lot of things, mainly the size of the company. I
Speaker 4: would say that the smaller companies are a little more
Speaker 4: nimble and they can move a little faster, so that
Speaker 4: has something to do with it. The other thing that
Speaker 4: makes it much easier to do is if you own
Speaker 4: your own manufacturing. So for companies that have their own
Speaker 4: manufacturing lines, they would be able to move much faster
Speaker 4: than someone using a contract manufacturer. So there's a lot
Speaker 4: of things that go into it. But I would say,
Speaker 4: you know, for a large CpG, it could take anywhere
Speaker 4: from six months to a year and a half, depending
Speaker 4: on how complex it is and depending on how many
Speaker 4: varieties you're launching and developing. And then you know, for
Speaker 4: the small companies, there was there was a phenomenon on
Speaker 4: TikTok for a while with pancake cereal. So somebody made
Speaker 4: teeny little pancakes in a pan, threw them in a bowl,
Speaker 4: poured milk over it, and was eating pancakes like cereal.
Speaker 4: It's kind of a brilliant idea. And there was a
Speaker 4: company called I think it's Belgian Boys, Belgian Boys, who
Speaker 4: picked up on it right away.
Speaker 2: Oh yeah, I say, I just I did a search
Speaker 2: for pancake cereal in the first The first one is
Speaker 2: Belgian Boys bite Sized Pancake Cereal.
Speaker 4: Yeah, there you go. So those guys are brilliant because
Speaker 4: they're already in the like the Belgian waffle kind of space,
Speaker 4: and so they blew my mind. But how quickly they.
Speaker 2: Got that quickly, I don't know.
Speaker 4: We did not work on it, but I remember seeing
Speaker 4: the thing on TikTok, and then maybe a couple of
Speaker 4: months later, they were at a major industry conference demonstrating it,
Speaker 4: you know, serving it. So that was pretty amazing.
Speaker 3: Who owns the intellectual copyright for something like, you know,
Speaker 3: the feta pasta bake or bite sized pancakes, Because it
Speaker 3: seems like you do see these things proliferate very quickly,
Speaker 3: and eventually they become so big that no one can
Speaker 3: really remember where they first came from. And then eventually
Speaker 3: you have companies that sort of formalize them into actual products.
Speaker 4: Yeah, I think those are the ones that end up
Speaker 4: owning and you know, air quotes owning the idea. It
Speaker 4: is very hard, if not impossible, to patent a formula
Speaker 4: or a recipe, so that almost never happens. So the
Speaker 4: best thing that you can do is put a really
Speaker 4: powerful brand on your product and make sure that your
Speaker 4: brand is associated with that thing. The other thing that
Speaker 4: you can do is you can trademark the name if
Speaker 4: it's not too descriptive, and you can patent with what
Speaker 4: is known as a manufacturing process, so you can get
Speaker 4: a process patent. But in the food world, it's just
Speaker 4: so easy for people to knock these things off. I
Speaker 4: can tell you because we've done it before, so you
Speaker 4: know it doesn't necessarily pay off to do that. The
Speaker 4: best thing you can do is just really market it well,
Speaker 4: make sure it tastes delicious, get lots of distribution, and
Speaker 4: sell it for a fair price.
Speaker 3: Jo, there goes my idea of making money from a
Speaker 3: corn rib grilled cheese sandwich dusted with fiery Cheetos.
Speaker 2: Yeah you could still if you had the right brand,
Speaker 2: the odd lots brand and the distribution, maybe you could
Speaker 2: do it. But yes, I agree, something bigger, all right.
Speaker 2: So a company comes to your barb and they're like,
Speaker 2: you know what, we need something new, we wanna we
Speaker 2: need a breakthrough snack chili lime. It's fine, but it's
Speaker 2: sort of getting mature whatever. Like I guess two questions
Speaker 2: like how do you identify the next big thing? And
Speaker 2: actually just what is the next big thing?
Speaker 4: Well, you have to be on it. You have to
Speaker 4: be watching the next big thing everywhere and all the time.
Speaker 4: So we look too higher end restaurants for inspiration. That's
Speaker 4: where we get a lot of them. We also look
Speaker 4: to TikTok. It's interesting that things are starting there and
Speaker 4: not just food, but the way that you're making food.
Speaker 4: The appliance is a using you know, there's a couple
Speaker 4: of appliances that have really taken off on TikTok, like
Speaker 4: the Ninja creamy that allows you to make high protein
Speaker 4: ice cream. So that's something that we're using on our
Speaker 4: trend lunch menu this year. So you really do have
Speaker 4: to look everywhere and then what we have to our
Speaker 4: advantage is that we are working with some forty to
Speaker 4: fifty food and beverage companies every day, and in our
Speaker 4: work for them, we're always doing consumer research. So we're
Speaker 4: constantly talking to consumers about what they like, what they
Speaker 4: don't like, what's resonating, what are they cooking at home,
Speaker 4: what are they eating out, where are they shopping. So
Speaker 4: we have a lot of institutionalized knowledge, and you know,
Speaker 4: that is our ip and that's part of what we
Speaker 4: bring to our clients. But it's a never ending search
Speaker 4: for the next thing. If I had to say one
Speaker 4: thing or one flavor right now, I would say that
Speaker 4: tropical flavors are just on fire. And tropical can mean
Speaker 4: everything from mango and pineapple to.
Speaker 2: Ube and everything, yeah and everything, yeah, exactly.
Speaker 4: So we're we're closely watching Southeast Asian flavors, so Filipino
Speaker 4: flavors like kalamansi, which is a bitter citrus that comes
Speaker 4: on the heels of yuzu, which is a Japanese kind
Speaker 4: of lime citrus. So you have to go far and wide,
Speaker 4: and it's it's really easy to do these days. I mean,
Speaker 4: if you think about just opening TikTok. And you know
Speaker 4: this is it's not a national audience of users, it's
Speaker 4: a global audience of users. So you're seeing what people
Speaker 4: are posting in Korea and elsewhere. That's the other thing
Speaker 4: we're very bullish on is Korean food.
Speaker 2: So I just have one request speaking of Southeast Asian flavors,
Speaker 2: and I'm seeing it more. But Pondon in particular is
Speaker 2: one of my favorite flavors, and so is a is
Speaker 2: a consumer. I just request please tell your clients to
Speaker 2: create more Pondon infuse sweets because that is probably my
Speaker 2: favorite flavor in the world. So I'm just passing down, passing.
Speaker 4: I will pass that along to all clients.
Speaker 2: Okay, thank you, Thank you very much, Barb Stucky. It
Speaker 2: was so great chatting with you. Really appreciate you coming
Speaker 2: on out block.
Speaker 4: Oh with my pleasure. It was super fun. Thank you
Speaker 4: for having me.
Speaker 2: Yeah, thank you so much.
Speaker 3: Thanks so much, Barb. I gotta go eat something.
Speaker 2: Yeah, Tracy, I never heard of a klamansi before, but
Speaker 2: it looks like a lime that looks like an orange
Speaker 2: in side. It looks amazing. Have you ever had one
Speaker 2: of these?
Speaker 3: I don't think I have. Hold on, I'm looking it up.
Speaker 2: Look at it. It looks like that. It looks like
Speaker 2: the cover of like the Freakonomics book, where it's like
Speaker 2: not the oh yeah, look at that. Doesn't they look good?
Speaker 3: That looks amazing. I don't think I have had that.
Speaker 4: No, I need.
Speaker 2: I definitely need to try a Kalamansi.
Speaker 3: Yeah, lots of ideas of foods to try. From that conversation,
Speaker 3: I thought the ozembic study was absolutely fascinating because my
Speaker 3: assumption had kind of been, well, if you're on ozempic
Speaker 3: and you're just not that hungry anymore, that companies need
Speaker 3: to try harder with like new and exotic flavors to
Speaker 3: lure you in, which means more sugar, more salt maybe,
Speaker 3: But per Barb's research, it seems like people don't want
Speaker 3: to eat that kind of stuff anymore.
Speaker 2: No, it's interesting too that the innovation, it sounds like,
Speaker 2: will be on preparation packaging in distribt.
Speaker 3: Yeah, and I think portion size.
Speaker 2: It sounds like so the idea of and the idea
Speaker 2: also that the maybe packaging in such a way that
Speaker 2: the person in the family who is on a GLP
Speaker 2: one can just have one of them, but everyone else
Speaker 2: can have more so you know, like a grilled, prepared
Speaker 2: chicken strip. Yeah, I could see like grabbing one out
Speaker 2: of the refrigerator and using that as a snack. But
Speaker 2: also you could have, like you know, someone else could
Speaker 2: grab five, or someone else could put a bunch on
Speaker 2: a salad or something like that, or the sort of
Speaker 2: sad sounding brownie cube.
Speaker 3: Really some of this does sound slightly dystopian to me,
Speaker 3: so nicol sized brownie bites, and like coffee made out
Speaker 3: of not coffee, although I can understand maybe why some
Speaker 3: people don't want to drink coffee, you know. In terms
Speaker 3: of individually wrapped chicken, this is something I remember they
Speaker 3: have in Hong Kong. If you go into a seven
Speaker 3: eleven or any of the meanings over there, they have
Speaker 3: like plastic wrapped I think it must have been boiled
Speaker 3: or roast chicken.
Speaker 2: I would eat that.
Speaker 3: You could just snack on. It never looks particularly appetizing
Speaker 3: to be but it does exist.
Speaker 2: Yeah, I would definitely eat it somebody. It sounds very utilitarian.
Speaker 2: It does seem like that maybe utilitarian is the way
Speaker 2: to put it. Also, this idea that like already, if
Speaker 2: someone is on one of these drugs, they're going to
Speaker 2: be eating in a new way or whatever. And so
Speaker 2: the idea of like keep some aspect of it that's
Speaker 2: familiar was an interesting idea. So something that people are
Speaker 2: familiar with, but maybe in a new way or a
Speaker 2: new portion. Or she mentioned the idea of like a
Speaker 2: clear protein drink instead of a gloppy like chocolate. One.
Speaker 2: Really interesting stuff there.
Speaker 3: Yeah, And I was thinking just going back to the
Speaker 3: original golp one discussion that we had with James Van Geln,
Speaker 3: and he was talking about these second order effects. I mean,
Speaker 3: it does seem like if you run a restaurant or
Speaker 3: something in some respects you can start tailor your menu
Speaker 3: to an increased proportion of the population that maybe doesn't
Speaker 3: want to eat really salty or heavy or sweet foods.
Speaker 3: But I have to think if you are a chip maker, yeah,
Speaker 3: not that kind of chip maker, a potato chip maker,
Speaker 3: or I don't know, someone who makes like soda or whatever.
Speaker 3: There must be maybe not soda, because I guess you
Speaker 3: could make a celsiest type energy drink that feels light
Speaker 3: and invigorating. But certainly if you're a junk food maker,
Speaker 3: this must be difficult for you, right, You are not
Speaker 3: going to be able to push a button and suddenly
Speaker 3: come up with a suite of healthy light options that
Speaker 3: satisfy the new gl P one population totally.
Speaker 2: Like if you get a bunch of people going around
Speaker 2: saying like I really am just craving a slice of
Speaker 2: cution cor Yeah, which, for what it's worth, I've been there.
Speaker 2: I've every once in a while just like a nicely
Speaker 2: crispiece of cucumbers.
Speaker 3: Who stick of celery.
Speaker 2: Yeah it's not bad or like I you know, I
Speaker 2: endorse that too, but it does not sound like a
Speaker 2: great opportunity if you're like in the business of like
Speaker 2: making ruffles or something like that.
Speaker 3: Well, the other thing I was thinking is I've seen
Speaker 3: some negative commentary around food packagers stemming from the weight
Speaker 3: loss drugs. So this idea that they're just not going
Speaker 3: to sell as much food, and okay, yeah, perhaps on aggregate.
Speaker 3: But on the other hand, it sounds like there might
Speaker 3: be opportunities if you're getting smaller portions for more packaging
Speaker 3: or more packaging for things like vegetable sticks or apple
Speaker 3: slices or whatever. It sounds like maybe there's an opportunity there.
Speaker 2: Well, if nothing else, I feel like after this conversation,
Speaker 2: I suspect we're going to start, you know, when we're
Speaker 2: going to the grocery store, notice things or pay closer
Speaker 2: attention to, like, oh, is this being portion sized or
Speaker 2: is this package sized in a way that looks tailored
Speaker 2: for someone on one of these drugs?
Speaker 4: Yeah?
Speaker 3: Absolutely, all right, a new grocery shopping game.
Speaker 2: Yeah, I thing to look forward to.
Speaker 3: Shall we leave it there?
Speaker 2: Let's leave it there.
Speaker 3: This has been another episode of the Odd Thoughts podcast.
Speaker 3: I'm Tree Alloway. You can follow me at Tracy Alloway and.
Speaker 2: I'm Joe Wisenthal. You can follow me at the Stalwart.
Speaker 2: Follow our guest Barb Stucky. She's at Barb Stucky. Follow
Speaker 2: our producers Carmen Rodriguez at Carmen armand dash O Bennett
Speaker 2: at Dashbot and kill Brooks at Kilbrooks. Thank you to
Speaker 2: our producer Moses Ondam. For more Oddlots, go to Bloomberg
Speaker 2: dot com slash odd Lots, where we post transcripts. We
Speaker 2: have a blog and a newsletter and you can chat
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