American culture* and the story of OJ

This is a series of posts that examines how and why American culture matters to American business. The opening post was “American Culture* and the Harvard Business School discovery,” and you can find it here.

I promised I’d look at several case studies in support of my thesis and this is:

American culture matters and business is bad at it.

Here’s the first case study: American culture and OJ

Consider a glass of orange juice.

For a very long time, OJ was in the words of the Atlantic, “the very image of refreshment, packed with vitamins and radiating with sunshine freshness…America’s classic morning drink.”

OJ was a piece of American culture* and its definition of “breakfast,” “morning,” “mothers,” “mealtime” and “nutrition.” It was part of a complex of meanings and rules that define what, when and why Americans eat what they do.

OJ took some of its value from this meaning.

We are accustomed to thinking about value as something that comes from utility, from functional benefits, from what Christensen calls “purpose.”

This is merely part of value. Value also comes from meaning.

But functional value is the thing we measure when we price. Meaning is largely invisible to our calculations. This is why culture is the “dark matter” of American capitalism.

And this brings us to the story of OJ.

Not very long ago, a new idea stole into the American consciousness.

The glass of OJ, once the picture of health, was now being called “a glass of sugar.”

The effect was spectacular. Between 2002 and 2017, the Nielsen-measured retail U.S. orange juice market declined by 50 percent. The WSJ heralded the death of this “breakfast table star.” Everyone suffered, farmers, an agricultural industry, and brands like Tropicana, Florida’s Natural, and Minute Maid.

It was a beautiful, if painful, experiment. OJ still had all its functional benefits. It was still charged with Vitamin C, minerals and all that non-specific “goodness.” The only thing that had changed was the cultural meaning. What was once “the very image of refreshment” had become an object of suspicion.

So what changed, precisely? American culture changed. What culture gave, it took away. What it valued, it devalued. What it charged with one meaning, it charged with another.

Specifying what OJ meant in its heyday is the work historians, semioticians, anthropologists, sociologists, strategists, planners, and other “trained professionals” who can comb through American culture and tease out the what, when, who and how of OJ’s rise to its place as “the very image of refreshment.”

Specifying how OJ fell, this falls to the manager, the C-Suite, the leaders of the organization. They may take these truths to be incontrovertible:

1) the meaning of OJ is arbitrary. It’s a little like the price of OJ on commodity markets. It responds to forces outside itself.

2) the meaning of OJ is the outcome of all the forces that now make up American culture, the companion trends, opinion leaders, experts, and marketers who shape and reshape how Americans define “breakfast.”

3) we need to map and track these cultural forces and actors so that we can anticipate the shifting consensus that will decide the fate of OJ. The advent of “big data” puts superb, sometimes real-time data at our disposal. Picture a visualization that lights up one end of the boardroom, showing the various forces at work like an air traffic control array. Behold, the future of OJ.

4) We must get ready now. We want to do this even when OJ is in its ascendancy. Because the first principle of a cultural understanding of Americans markets is biblical: “this too shall pass.” Every consumer taste and preference, however inevitable it seems to us now, is in fact arbitrary, vulnerable and at some point vanishing.

Somewhere out there is a new Alice Waters. She is riding a black swan. She is coming for a market we take for granted. In a superheated marketplace, the time to respond is not when prices are taking a header. The time to respond is when we have deep pockets and breathing room.

Increasingly, American enterprise lives in a state of defensive, ad hoc, reaction. We are being stripped of strategy and planning. We are not so much agile as engaged in a mad scramble of blind response. Getting good at American culture can help fix this. It can return to us some of our powers of anticipation, preparation, and adaptation.

And so ends this first case study in the series called “American Culture* and the Harvard Business School discovery.”

Tomorrow: “American culture and the Coca-Cola Company”

✻ Why do I call it “American culture?”

To distinguish it from “corporate culture.” There are two kinds of culture an organization must understand and a manager must manage.

Culture Inside: this is the culture of an organization, the “corporate culture.”

Culture Outside: this is American culture.

We sometimes confuse these. But that’s a little like confusing American football and European football. My Culture Camp is dedicated to understanding American culture, the culture outside the organization. This is where we find blue oceans of opportunity. This is where black swans of disruption find us. It’s time we made the distinction.