Monday, April 21, 2008

M&Ms and consumer preference


If you are willing, take a moment to think about how many kinds of M&Ms you've seen recently. Here's a little M&M history while you are doing that:

- M&M's were first sold in the United States in 1941.
- In 1954, Peanut Chocolate Candies were introduced.
- In 1988, Almond M&M's hit stores with limited release. Mars gave them full releases in 1992.
- In 1990, Peanut Butter M&M's were released.
- In 1996, Mars introduced a new M&M candy: the "M&M's Minis."
- In 1998, Crispy M&M's were released.
- In the summer of 2005, Mars added "Mega M&M's" to the lineup.
- In July 2006, the dark chocolate M&Ms reappeared.
- In 2006, the company also trialed white chocolate M&Ms.

This is quite a list, and it doesn't even take into account seasonal M&Ms, personalized M&Ms, and some of the limited editions I have been seeing lately like cherry and rasberry. Interestingly enough, this variety is a relatively new phenomenon. As you can see, it wasn’t until the 1990s and later that all of the others became widely available.

M&Ms are not alone in this regard. From detergents and banks to automobiles and airlines, today we are faced with an abundance of consumer options.

So what’s going on here? Well, one possible explanation is that we have in many respects turned a corner in the way producers view the market. Early on in the production of the Model T, Henry Ford was famously said to have commented that "People can have the Model T in any color - so long as it's black." Producers were attempting to mold public tastes to match the products they were releasing. If we think about this in economic terms, supply was in many ways driving demand.

Today, it seems as though the tables have turned - probably for a number of reasons producers are attempting to meet consumer demand with what they are producing.

This has some important implications - particularly for SRI. If it is the case that demand is driving supply, then we are arguably in an era of relative consumer sovereignty. What you do with that dollar in your pocket is significant. We can look into how this plays out in later posts.

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