The recent release of “Unfrosted”, directed by Jerry Seinfeld, had a disappointing debut on Netflix and was even considered “one of the worst movies of the last decade“
But with an all-star solid that features Seinfeld, Jim Gaffigan and Amy Schumer plus America’s love for Pop-Tarts – In 2022, $3 billion was sold – the film has the potential to turn out to be a cult classic.
And while it might make viewers need to return to those 93 minutes they spent watching the movie, the true story of the toast cake may teach a precious lesson concerning the persistence of serial entrepreneurs and the strategic decisions that may create a competitive advantage.
In mine teaching, research and dealing with student entrepreneurs over the past 15 years, I’ve learned that entrepreneurial ideas haven’t got to be “new to the world” to achieve success.
A brand new invention: cold cereals
In 1876, Dr. John Harvey Kellogg, a renowned physician and creator, took over as superintendent of the Battle Creek Sanitarium. The famous medical resort attracted 1000’s of patients every year to the small town of Battle Creek, Michigan.
John’s younger brother, William Keith Kellogg, handled the day-to-day operations while John tried to supply his patients with fresh air and a vegetarian, whole-grain food regimen, which he called “biological life“
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The food regimen inspired the brothers to develop a recipe for a healthy breakfast, recognizable today as cold cereals. John Kellogg saw cereal as medicine for his sick patients and created the Sanitas Food Company to provide it for the sanitarium’s guests.
Will Kellogg believes that the product may also be consumed by healthy people. Although he saw broader business potential, he didn’t determine to pursue the thought until he saw the entrepreneurial success of a sanatorium patient who produced an identical product. This patient’s name was Charlie “CW” Post.
The post office couldn’t afford to pay for full room and board on the sanatorium, so he worked within the kitchenaccessing recipes.
After leaving the sanatorium, Post founded his own company, Postum Cereal Company, in 1894 and introduced the primary ready-to-eat cold cereals to the broader market.
Post success prompted Will Kellogg to depart the sanitarium industry in 1906 and located the Battle Creek Toasted Corn Flake Company, which became a direct competitor to Post. In 1909, the corporate was renamed the Kellogg Toasted Corn Flake Company and in 1922 the Kellogg Company.
Serendipity results in business success
Although this cold cereal story predates the Pop-Tart story, it shows a number of the ways wherein entrepreneurial ideas come to light.
In the case of Kellogg’s Corn Flakes case played a task.
Although there are barely different versions of the unique story, the gist is that after rolling out wheat dough and forgetting about it overnight, the Kellogg brothers discovered that the stale dough easily broke into thin pieces that could possibly be used to arrange cold cereal. Will later produced flakes with corn that were crunchier.
Another lesson of entrepreneurship is that success can simply be achieved recognizing a chance.
The approach to preparing cold flakes was discovered by accident and over time perfected through trial and error by the Kellogg brothers. CW Post adopted – some might say stole – the strategy for business use, without having to spend time inventing and perfecting the product.
Although the Kellogg brothers could have invented a healthy alternative to breakfast, Post was the primary to bring this invention to market and thus the primary to reveal its business viability.
Toaster Dough Race
While Post could have won the cold cereal battle within the product’s early days, Kellogg’s won the toaster cake contest featured within the movie “Unfrosted.”
After Post’s death in 1914, his daughter, Marjorie Merriweather Post, played by Schumer within the film, took over the corporate on the age of just 27, becoming one in all the primary American women to carry executive positions. In 1929, Postum Cereal Company became General Foods Corporation after Marjorie Post made quite a few business acquisitions.
What happened next shows that being first to market doesn’t at all times provide a competitive advantage. In fact, it’s normal for some marketing experts to call this the “second-mover advantage.” One industry research suggests that early movers beat latecomers in just 15 out of fifty product categories.
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This is what we see within the Pop-Tart story.
It was Statement of Marjorie Post in February 1964 about upcoming “Country Squares” – shelf-stable fruit-filled cakes – which gave Kellogg the thought to create its own version.
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In the six months before Country Squares even hit store shelves, Kellogg’s released “Fruit Scones.” They were fast renamed Pop-Tarts after the favored pop art movement of that era.
Pop-Tarts turned out to be successful. In 1967, Kellogg’s added frosting that didn’t melt within the toaster and extra complementary flavors original 4 – blueberry, strawberry, brown sugar, cinnamon and apple, currant.
What about Post’s village squares? In 1965 the name was modified to Toast’ Pop Ups, and in 1971 the brand was sold to Schulze&Burch Biscuit Co.currently the world’s largest supplier of store brand toasters.
In a nod to this history, the Pop-Tarts website states, “Others may have tried making toaster dough, but only one has ever perfected it.”
Although the primary mover could have a bonus, the short follower often wins the sport in the long term.
