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Frito-Lay proudly let the world know in 2010 that they had created the “World’s first 100% compostable chip package,” Less obvious was a second note saying “This bag is louder because it is compostable.” Consumer Reports said it was twice as loud as a Tostitos bag. Others compared it to a jet engine.
And that was the problem. After sales declined by 11 percent, Frito-Lay returned five of its six Sun Chips flavors to their old bags.
Where are we going? To how firms use sound to compete.
The Apple Chime
The Apple start-up sound has been called rather zen but it wasn’t always like that.
When the earliest Macs were created during the 1990s, Apple sound engineer Jim Reekes thought their start-up chime was annoyingly dissonant. Reekes realized that a start-up sound could frame our entire experience. So when his bosses said no to the “fat C-major chord” he had created for the start-up, late one night, he snuck in and changed the code. Subsequently, a Byte magazine reviewer of the new Mac noted that “I knew I was in for something great when I heard it turn on.”
Trademarked Sounds
Like the Apple start-up chime, when a sound uniquely defines a firm’s identity it can become intellectual property that is protected with a trademark from the U.S. government.
The NBC chime secured the first sound trademark in 1971:
The Green Giant’s Ho Ho Ho is trademarked:
So too is the MGM lion’s roar…
Our Bottom Line: Product Differentiation
For sellers who engage in monopolistic or oligopolistic competition, product differentiation is a must. With monopolistic competition where we have many sellers, a restaurant like Chili’s, for example, uses its sizzle to separate its fajitas from all others. With larger more powerful oligopolies, sound also resonates…but, as with Sun Chips, not always the way we might expect.
Because perfectly competitive firms sell identical products like potatoes, and monopolies have no competition, those who compete along the middle of the market structure continuum are the ones that need product differentiation.
