Right after the TV ads appear, the Colorado Cattlemen's Association sends a blistering letter to Mel Coleman, objecting to McCabe's ads on the grounds that they impugn ordinary beef. Now the National Cattlemen's Association is chiming in. Coleman's campaign "clearly constitutes negative advertising," accuses the NCA. "In response we have sent factual information on hormones, antibiotics, and residue rates to a number of retailers, purveyors, food experts, and journalists in the Boston area."
This is a tempest, Graves worries, that may not stay in its teapot. His contract slaughterer, a big beef packer in nearby Greeley, Colo., has just given Coleman 120-day notice to accept a price increase of $5 per head or go elsewhere, eventually forcing Graves's managers to scramble for a new supplier. Was the ad campaign a factor? There's no evidence, just a lot of suspicion. "There was a ripple up there when our ads came out," says operations vice-president John VanOrman, who deals with the meat packer. "They said, 'You're bad-mouthing our beef.' " Worse, the dispute may be hurting Coleman's chances with retailers.
April 23, Tuesday. The marketing campaign seems to be turning into a good news/bad news joke.
The good news is good indeed. Purity has reported that its March sales of Coleman beef are more than twice those of last year at this time. And Coleman accounts for twice as big a share of total beef sales as a year earlier. To be sure, Purity has cut its prices on Coleman beef for the duration of the campaign, and Coleman is eating some of the reduction in margin. Nevertheless, the ads are working. Consumers like the product. When a store supports it, it moves.
The bad news, however, is horrible. By now Coleman is well into a five-month advertising campaign costing $640,000. Yet it still hasn't cracked another Boston chain. At the company, demoralization threatens. "The thing is, after all this work and money, we don't have any more customers than I did when I was selling meat out of my saddlebags," Mel complains.
There is one hope in the near term: a delegation from Coleman has gone back to Star, this time prepared to cut a deal. The one thing Coleman has never done is pay retailers slotting allowances, the legal but controversial shelf-space charges that supermarkets frequently wrangle from their suppliers. It is less a matter of principle than of economic necessity; with a low-volume, specialty product like Coleman beef, payback could take years. But Star has let it be known that a little cash up front might help. So Graves, Mel Jr., and broker Al Walton put together a package deal: so much in slotting fees, so much more in money for co-op advertising, the total coming to $25,000. "We put everything we had on the table," says Walton, "dollars that Coleman really doesn't have to spend." The point turns out to be academic. Star remains uninterested.
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A marketing campaign is like Yogi Berra's baseball game: it ain't over until it's over.
"Advertising is cumulative," Mack Graves reminds a visitor and probably himself as well. "We've got to stick with it all the way through, even if it's damn near a million-dollar program." At stake is the whole direction, possibly even the survival, of Coleman Natural Meats. If the campaign works -- if Coleman can get the distribution it wants and if consumers snap up its meats as Purity shoppers have done -- enormous vistas open up. A successful track record in Boston would generate opportunities not available to Coleman in the past. Both Graves and venture capitalist Wayne Kingsley hint at lucrative joint-venture possibilities, with a big food company bankrolling Coleman's entry into other markets.
If it doesn't work, of course, Coleman is probably finished in its attempt to crack the mass market. That may not kill it as a company: the business can search out other customers in other places. "We'd have to look at direct mail," says Graves. "And the food-service business." But the company would need new money, a new plan, possibly even new people. By August, when the Boston campaign is over, the die will have been cast one way or the other.
For Mel Coleman, the marketing campaign has been a roller-coaster ride, with the end not yet in sight. He sometimes wakes up at night, he says, with "the scares." Will the product sell? Will the beef industry get mad enough to file a lawsuit? Will the bank that finances his cattle get cold feet? "Guys will say, 'Mel, how can you do this and have a smile on your face all the time?' They weren't there when you woke up at 2 a.m. and your heart was pounding." Still, Mel is convinced that his market is growing. "There's Earth Day. There are bans on hormones around the world. Everybody's talking about the environment. So there are more and more customers out there now."
Graves, for his part, has been back to Stop & Shop and Shaw's, and plans to return to Star and the other retailers that are the intermediaries between Coleman and all those presumed customers. This time he will be armed with market research showing the impact of McCabe's ads and the high number of repeat purchasers.
"I'm like a wave on a rock," he says with a sigh. "I keep hitting it and hitting it until finally something gives."
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Epilogue: On May 16, shortly before this issue of Inc. went to press, Shaw's agreed to test-market Coleman prepackaged beef in two of its stores. The first order: 360 pounds. Stop & Shop and Star had still not signed on. n
