You've known us all along: Shoddy Goods 001
I'm Jason Toon and this is Shoddy Goods, a newsletter from Meh about the stuff people buy, sell, and make. With the Paris Olympics kicking off next week, I salute the gold-medal winner for most baffling Olympic ad campaign of all time.
Let's say you're a huge corporation who owns a bunch of folksy, beloved consumer brands. You're probably hoping your customers stay blissfully unaware of your very existence, right? You don't have to be a branding expert to get that it would be a major turn-off, like when 30 Rock's Liz Lemon learned her favorite artisan hipster jeans were ultimately sold by Halliburton.
But 40 years ago, one of those corporations made the bold decision to shout "hey, America, we're the shadowy conglomerate lurking in your pantry." And they did it on the biggest stage possible, with a saturation ad blitz during both the winter and summer Olympics.
You've known us all along
In the cozy warm-lit style of '80s packaged-goods commercials, the ads unspool vignettes of the most sacred moments of American life. Each scene stars an iconic product: Thanksgiving dinner with Butterball Turkey, a campfire weenie roast with Hunt's Ketchup, a dad (played by future Back to the Future bully Thomas F. Wilson!) reading his kid to sleep with a mug of Swiss Miss Hot Chocolate.
Each scene climaxes with the protagonist looking into camera and intoning a single word: "Beatrice". And then they hit you with the jingle: "We're Beatrice… you've known us all along."
Believe it or not, this might not be the creepiest moment in this commercial. Watch if you dare.
I was 10 during the 1984 L.A. Olympics. I was one of the 180 million people tuning in for every pole vault, every Retton flip, every splash in the water polo pool. So I saw these commercials dozens, if not hundreds of times. I remember schooling my friends on this crucial secret of the grown-up world, that the stuff at the grocery store was owned by some big company that also owned a bunch of the other stuff at the grocery store. I've always been a know-it-all.
Luggage and cat treats
How could it possibly it seem like a good idea to reveal the sinister puppeteer pulling the strings of Orville Redenbacher and Swiss Miss?
Because the ads weren't really aimed at the general public. Or not directly. Beatrice CEO James Dutt had been stung by criticism from Wall Street that Beatrice Foods lacked the broad portfolio of brands, nationwide distribution network, and public profile that would make their stock a good buy.
So in 1983 the company engineered a takeover of another conglomerate, Esmark, in the biggest merger in U.S. history up to that point. Beatrice now had brands like Avis, Playtex, and Max Factor, along with an extensive distribution system. "In one stroke, we added major new food areas, backed by the strongest grocery sales distribution system in this country," CEO Dutt was quoted saying in the Washington Post.
But it wasn't cheap. Beatrice had to take on $3.5 billion in debt to make the deal, back when a billion bucks was real money. Wall Street didn't like that, either. There's just no pleasing some people.
So then Dutt felt even more pressure to prove that Beatrice was playing with the big boys. Like a losing gambler chasing that one jackpot that will get him out of the hole, Dutt couldn't stop throwing more money on the table: in this case $30 million on the Olympic ad campaign. Yeah, that'll show 'em.
Even at the time, people thought it was weird. As Smith, Barney analyst Ronald Morrow asked, "Does it give them a better image within the consuming public for someone who buys Samsonite luggage to know that the same company also makes cat treats?"
The flights of Chairman Dutt
Lest you think I'm being unkind to Dutt, the 1990 book Beatrice: from buildup through breakup by Neil Gazel paints the very picture of a manic, imperious CEO. "To many, Dutt seemed to be a man possessed," Gazel writes, "irritated at questions about the reality of his goals."
He threatened to fire some top Beatrice executives in front of a crowd at an industry conference and was unreachable for long stretches of time, retreating into (as Fortune put it) "Howard Hughesian seclusion."
When he emerged from his bunker, it was often to jet around the world on the company Gulfstream for surprise visits to Beatrice offices and plants. But even if he couldn't stop by in person, a painted portrait of Dutt watched over every one of those hundreds of Beatrice facilities, prompting the Mao-inspired nickname "Chairman Dutt".
Company staffers thought Dutt's heart truly belonged to auto racing. He flirted with a cockamamie scheme to build racecars in England and splashed out more company cash on a Beatrice motorsports team with Paul Newman and Mario Andretti.
Biff! They got you, too?
Dutt's, er, magisterial leadership style was summed up by a cartoon he kept on the wall of his office captioned “All those opposed, signify by saying ‘I quit.’“ Two dozen of Beatrice's top executives did just that. "He's a very vindictive guy and I don't think I need that," one of the departed told Fortune magazine.
Cue a new round of furrowed brows on The Street and beyond. "Mr. Dutt, driven by a private vision and an unexplainable impatience, is on his way to ruining an important Chicago company," opined Crain's Chicago Business in a 1985 editorial titled "Jim Dutt's Sorry Record".
But maybe Beatrice was such a positive, likable company that the public association would actually help their brands, right? Maybe once the masses heard what good guys Beatrice were, they'd rush out to buy more Jolly Ranchers and La Choy Chow Mein?
Not that either. Beatrice was one of the defendants in the child leukemia toxic waste case chronicled in the book and movie A Civil Action, eventually found liable for a $68 million cleanup by the EPA. And they continued doing business in apartheid South Africa in the face of the growing international boycott that was a key factor in ending apartheid.
The devolution had been televised
Whatever Beatrice was trying to do with those commercials, it didn't work. The campaign did raise the company's name recognition to 68% of the U.S. public. ''But so what?'' a recently departed manager asked Fortune at the time. ''Where is this reflected in the stock market, or the movement of products? Studies have shown no boost from the name Beatrice. The Olympics advertising probably didn't sell one more item.''
Dutt was ousted by the board less than a year after the Olympic closing ceremony, in August, 1985 - appropriately, while he and 600 employees were at an auto race. Without their motor-mad patron, the Beatrice racing team suddenly found its sponsorship yanked.
Beatrice itself was swallowed up and dismantled by 1989. After 95 years in business, a once-powerful American company had fallen apart. (Dutt died in 2002.) An entity called Beatrice Companies was revived in 2007 and is still kicking around, which just goes to show you that no drop of nostalgic brand equity is too tainted for somebody to try to squeeze a buck from.
What's most striking to me today is not the obvious wrongheadedness of the Beatrice campaign, nor even the unsettling ads themselves. It's how ahead of its time the story seems.
An out-of-control, hubristic, erratic CEO makes a bizarre and expensive play for Wall Street buzz in front of an audience of hundreds of millions, and torches immeasurable amounts of brand equity: sounds like something Elon Musk or Mark Zuckerberg could have done last week. But James Dutt and Beatrice were there all along.
Jason Toon
Shoddy Goods
Wow, I had a vague memory of those ads but no idea how boneheaded that whole campaign was. Did you see these when they aired? Have any other memories of ridiculously misguided corporate PR? Let’s talk it over in the Meh forum!
- Dave