Picture this: You are in a supermarket in Costa Rica.  Your favourite fibre cereal topping is All Bran. There are two different boxes available on the shelf.  One costs $5, the other costs $7.

Kellogg's All Bran vs. Kellogg's All Bran

Kellogg's All Bran vs. Kellogg's All Bran

Aside from being bloody expensive when you do the exchange calculation, you look closer to see what difference is.

They’re both:

  1. From Kellogg’s
  2. The same size
  3. Original, normal All Bran
  4. Containing exactly the same ingredients
  5. Best before a similar date (neither is e.g. a line-end)

The only difference: $7 All Bran is made in the USA.  $5 All Bran is made in Mexico.

I asked the store manager whether stocking both SKU’s was just a mistake.  Apparently not.  Some Americans and Canadians prefer to spend 40% more on something made in Michigan vs exactly the same product made in Mexico.

Is this nationalist?  Not really.  If it’s from Kellogg’s anyway, people know they’re supporting an American business somewhere down the line. I’m not one to call the racist card, but…

It’s racist. The only reason someone would trust the American All-Bran more (and be willing to pay more) is they either don’t trust the Mexican factory where it’s made or they think a secondary factory means it’s second rate cereal.

Of course I could go on a diatribe about how racism is wrong. Racism is wrong. But this blog is not about political, moral and race issues.  It’s about branding.

My message today to brands is: make money off the racists! They’re willing to pay for their stupidity. Emphasise your point of origin in markets where consumers are uneasy with your competitors’ origins.  When where you’re from is not useful, keep it quiet.

Join the conversation! 5 Comments

  1. Interesting…

    Especially the idea that they will pay more for the American brand. I actually feel like there is a distinct low level anti-american sentiment here and that the average Joe Tico would choose the non-American brand… even at a higher price point.

    I would love to know if the pricing of these items varies (or even if both exist side by side on the same shelf) in non-coastal, non-gringo units.. and if the pricing structure is maintained in units with differing demographics.

    This is the kind of demographic insight that I’d expect to see from a Wal-Mart owned business (of which there are plenty here in Costa Rica) and it’s interesting to see the cheif competitor to Wal-Mart working their mojo so well… here in Costa Rica.

  2. hey george, brands are not racist here. Infact its not abt racism atall. Its abt the small retailer, typically mom & pop shop owner who is trying make a better buck. Infact, now that i say it, it happens in big super-markets also. take Tesco in UK – in fruit aisles, you get grapes from greece, uk, spain and brazil (i don’t recollect exact countries, but the point is from multiple markets). Do we get different tastes, flavours, sweetness? Yes. Are some of us ready to pay premium for that? Yes! what brand are they – they are Tesco-branded with country of origin mentioned clearly.
    If you in singapore, there are electronics shops, where retailers sell you a sony camcorder – made in japan, china and malaysia. why? perceived value by consumers? can they charge premium? Yes. is there a quality difference – maybe yes, maybe not. Is there a difference in costs to retailers – yes, b’cos one is duty-free, while other attract different custom duties.
    In China, Jenny Luo (hope I remember correctly) retail chain imports and sell food items to expats living in china. there’s a market. Infact cereals from multiple markets were quite common there.
    Retailers will spot this opportunity and sell. Brands – shouldn’t!!!
    Cheers, Anand

  3. Anand, totally agree, brands aren’t racist; people are racist. But I also agree with you that there’s a lot more emotions and dynamics to the issue than just race, I was just trying to be a bit provocative. Nice to hear from you!

  4. Would have not viewed this as racist – very interesting take. Being a Mass Comm major and studying advertising, media perception, branding etc.. I see it more as sort of a loyalty/comfort issue, not so much brand loyalty because they are both the same! People (yes and I am going to generalize) to a certain extent feel comfortable or connect more with what they know/are used to so if an American is shopping in a foreign store and sees something he gets back home I am not surprised in the least that he would go for the english box of cereal made in the good ol’ U.S.A. – he connects more with this and feels comfort that the product comes from “home”; that being said there are probably people who do harbour racist thoughts and very well may choose to pay more for the cereal thinking they are “screwing it” to the Mexicans, Puerto Ricans etc…..for whatever reason. I would never have considered that until now!

  5. Hey George:
    I’m following up with a close of mine who was actually the product manager for the All Brand product line at Kelloggs.

    I’m asking for the rationale in what is going on….I’ll report back with a corporate response…


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