July 11, 2011

Caught by Surprise, Kosher Purveyors Can Only Wonder Could it happen here?

Could kosher consumers using Facebook and Twitter force a reduction in prices just as Israelis did with cottage cheese? "We were surprised at the strength of the cottage cheese crisis,” said Strauss Group chairwoman Ofra Strauss at the annual Tel Aviv Stock Exchange conference in London. "We were surprised by the impact of Facebook," she said. Strauss also admitted that "we were surprised that our consumers were extremely angry." She said that Strauss believed that its communications with consumers were very important. "It's important for us to know what they want and what they are unhappy about. So the power of the crisis surprised us." Even more telling, and perhaps reflecting the thinking of most producers of kosher is what Ms. Strauss said next: "Once, I thought that the company's aim was solely to sell more and more products. But now I understand that a company like Strauss Group also affects the quality of the environment and the quality of life of the consumer." Yes, the Internet offers kosher consumers a weapon they may very well use with increased frequency in coming years. Concepts like Groupon and there are already several kosher versions, will empower consumers to make decisions based on the best deals. In Israel, such sites are popping up almost overnight, particularly after the cottage cheese crisis. In fact, the food price protesters recently launched a website claiming that “every Israeli family can save some $450 or more on their monthly shopping bill.” Already, some retailers are telling me that any specials they advertise seems to have an overnight effect as consumers on Facebook alert their friends. The cottage cheese revolution may one day be recognized as a watershed event for kosher consumers that hands the control over prices to financially hard pressed consumers. One Israeli executive told me last week that “many of these companies better start revising their five-year projections or at best hire some of these consumer advocates to help them prepare for significantly lower profits.”