Juanita’s Tortilla Chips has achieved the kind of customer loyalty that money can’t buy.
Maybe that’s because people love the way the chips taste. At least, it seems that way from The Columbian’s highly unscientific taste test.
Juanita’s, out of Hood River, Ore., faces a market challenge from snack food giant Frito-Lay, which has unleashed a rival chip product called La Cocina de Josefina. While the Josefina’s chips are sometimes displayed locally in supermarkets with a “Made in Vancouver” sign, nowhere does the label identify Josefina’s as a Frito-Lay product. It does, however, list the address of the Frito-Lay plant on Fruit Valley Road as the location of a company named La Cocina de Josefina, and Frito-Lay has confirmed that it is test-marketing Josefina’s in the Northwest.
That means Juanita’s faces a giant challenge. Frito-Lay, a division of Pepsico, owns many of the world’s top chip brands, including Doritos, Fritos and Tostitos. It owns about a 60 percent share of the U.S. salt-snack foods market and a 40 share of the global market, selling in 120 countries, according to industry sources. It’s constantly looking to add new brands and eliminate weak performers as it works to dominate supermarket shelf space.
The company’s strategy of launching a brand that downplays an industry giant’s ownership is hardly original. Joe Cote, professor of marketing at Washington State University Vancouver, cites the example of Blue Moon beer as a product from a national giant — Coors Brewing Co. — that gives the appearance of a local craft beer. “It’s a common ploy used across a variety of products,” Cote says.
Still, The Columbian’s report on March 19 about Frito-Lay’s stealth marketing campaign for Josefina’s triggered a strong reaction on social media. The story circulated widely on Facebook and other sites, regularly resurfacing over several weeks as one of this newspaper’s top online stories of the day.
Yet while social media commenters urged loyalty to Juanita’s as a “local” Northwest company, Josefina’s was tapping its deep corporate pockets for highly visible product placement at Fred Meyer stores and other retail outlets. A Frito-Lay spokeswoman at company headquarters in Plano, Texas, said the earlier company would consider the product’s acceptance in the Northwest before deciding whether to launch a full product rollout under the Frito-Lay banner.
In recent months Josefina’s has been displayed prominently in some stores, and even been given away at no cost in small packages. But it’s nowhere to be found in some supermarkets. And it appears that the new product is having trouble matching Juanita’s on price. Juanita’s standard-sized 15-ounce package was selling for its regular $2.39 price at Fred Meyer’s Grand Central store last week, slightly less than Josefina’s sale price of $2.50. (The regular price was listed as $3.49.)
And Juanita’s was even winning the war for visibility at the Grand Central store. Its chips occupied several shelves among a sea of chips, with more than 60 bags available on Tuesday morning. It took a couple of queries to find a clerk who could point to Josefina’s chips on a lonely display in the frozen food section, with about 36 bags available.
With the competition heating up between a national giant and a local little guy — or two local companies, depending on your perspective — it seemed fair to ask: if we set aside brand loyalties and price, which of these chips tastes the best?
The Columbian wanted to find out. Lacking the resources to launch a major research project, we contacted the strategic communications firm AHA!, based in Vancouver, and asked its staff to participate in a taste test. The company, which cultivates a creative and opinionated culture, readily agreed.
The test was set up in AHA!’s light-filled lunchroom on the sixth floor of the Vancouver City Hall building.
We set out bowls marked “Chip 1” and “Chip 2” and asked employees gathered for the usual company-sponsored Monday lunch to give each chip a try. Salsa was optional. Sue Vorenberg, a reporter for The Columbian, lightened the mood by wearing a protective suit (“to protect myself from politicians in City Hall”) while conducting quick interviews with the taste testers. Videographer Paul Suarez recorded the tasters’ reactions.
Fourteen AHA! employees participated in the test. Before revealing the results, we offer a couple of huge caveats that might have influenced the test results. First, the chips are different in appearance. Juanita’s are larger, have more variation in shape, and are consistent in color. Josefina’s chips are thicker, coarser and have dark flecks that make them easily distinguishable from their rival product. Those AHA! employees who regularly snack on Juanita’s chips had no trouble recognizing them before the first bite.
Add in the reality of tester bias — one AHA! employee freely admitted that Juanita’s partisans in the office clearly hoped their favored chip would win the taste test — and you have a test that would never pass muster in the professional research world.
But even with that, the results and comments from the pool of tasters were revealing.
On a 1-to-5 ranking in the combined categories of freshness, saltiness, crispness, texture and overall tastiness, Juanita’s was favored by nine of the chip testers. Four of the testers preferred Josefina’s, and one gave both chips an equal ranking.
Yet among the testers, none expressed a strong dislike for either chip. The most common complaints against Josefina’s were that it was too salty or simply too much like other Frito-Lay products. “Chip #1 (Juanita’s) is tastier and less mass-produced,” wrote Eric Smith, senior creative director, on his ranking form.
Some liked Josefina’s for it’s heavier, coarser texture and even its saltiness, while others preferred the lighter texture and somewhat greasier flavor of Juanita’s chips. “Chip #1 (Juanita’s) was tasty enough to eat on its own, but also paired really well with the salsa,” said Michael Fisher, an AHA! senior writer and editor. “I thought Chip 2 needed a lot of salsa or other dip to make it taste good.”
While the survey didn’t ask testers to comment on the product packaging, it was a logical follow-up question to ask professionals who work in corporate image-making. (Another awkward disclosure: the Juanita’s package was a 24-ounce “Fiesta Bag,” larger and slightly different in appearance than the company’s more common 15-ounce package. (It’s tough to resist a $2.99 sale price at Grocery Outlet.) In that area, Josefina’s image of a woman wearing traditional clothing while making tortillas the old-fashioned way was preferred by many of the marketing experts over Juanita’s image of a man, wearing a sombrero, riding a donkey with a cactus in the background. “It looks more authentic,” Kari Olivier, AHA’s senior director of account development, said of Josefina’s.
We also asked newsroom staff members at The Columbian to participate in the still-informal test. There, the results were much closer: four newsroom employees favored the Juanita’s and three preferred Josefina’s. The overwhelming complaint about Josefina’s was that the chip was too salty.
A Frito-Lay spokeswoman at company headquarters in Plano, Texas, said the company had no comments for this story. Luis Dominguez, president of Juanita’s, did not return phone calls or emails.
Finally, we turned to Joe Cote, the WSUV marketing professor, for his thoughts.
Cote acknowledged that he has no specialized expertise in the snack food market or the Juantia’s-Josefina’s competition. But he believes the “local” angle is largely irrelevant in the case of chips. They’re not sold as fresh products, and neither is promoted as organic. Both are produced locally and face similar transportation costs, he noted. And the “Buy Local” movement is not focused on the snack chip market.
“We would not expect the “local” brand to really be different or better in some meaningful way — like it might be with vegetables, meat, beer or a local specialty,” Cote wrote in his analysis for The Columbian. “We just don’t have a unique Northwest corn chip style.”
While having a major brand with vast resources come into your market can be a nightmare for a small firm, Cote believes Juanita’s has much going for it.
“Juanita’s advantage is that they are already on the shelves and have a good reputation. So it becomes Frito’s job to move Juanita’s off the shelf,” he said.
“If they do displace someone, it is likely to be the weakest brand in the category,” Cote added. “I don’t think that is Juanita’s.”
Cote found the two brands similar in taste. His view on Juanita’s was mixed: the chips were larger than Josefina’s, making them easier for dipping. But they were thinner and had more bubbles, making them more fragile.
His conclusion: choose your chips based on price. For his own test, he went to Albertson’s after failing to find Josefina’s at Safeway. Cote paid $2.99 for the Josefina’s and 2.29 for the Juanita’s (both 15 oz. bags) at Albertson’s.
His prediction: “If Frito’s doesn’t cut price, I don’t see Josefina’s getting out of the “test” stage.”