Cookie Price Differences Explained

Economics, Web Standards

Well after much Googling, I found two definitive sources that say there are price differences in cookies. I found an article (word document, view as HTML) from the Wall Street Journal that talks about a price war in Michigan between neighbooring councils that had prices at $2.50 and $3.

Girls are told that if customers ask about the price difference, they should explain the economic factors at play — that the Metro council serves four times as many members as its “sister” council, and runs three more camps. Michigan Metro says its troops receive a profit of at least 45 cents on each box sold; in Macomb County, the minimum is 32 cents.

Oh that’s wonderful. Item 9 on this Girl Scout FAQ confirms that prices are set indivdually by over 300 councils.

Such scenarios have been repeated in other parts of the country, as many of the nation’s 330 Girl Scout councils go through their annual pricing debate. Officials say they can’t adopt the simple solution—setting one national price—because their parent organization, Girl Scouts USA, follows the Sherman Act, which prohibits price fixing.

With each council individually incorporated as a nonprofit organization, Girl Scout officials say the law, originally designed to rein in robber barons, could apply to them as well. “In being good citizens, we choose to abide by the spirit of the law,” says Girl Scouts USA spokeswoman Ellen Ach. At a national meeting of council leaders last month in San Diego, Girl Scouts USA officials reiterated their position that prices shouldn’t be discussed among local councils.

So there’s a legal reason for the price differences, but I think it’s highly unlikely that the Girl Scouts of America would be prosecuted under the Sherman Antitrust Act, though personally I think the prices are a bit high. It’s supply and demand, and I think people would buy more at a lower price. They are also outpacing inflation: my simple calculations using the GDP Implicit Price Deflator, which is Greenspan’s favorite measure of inflation, gives me that if a box of Girl Scout cookies was $2.50 in 1996 it should be about $2.80 now, give or take a few cents. There haven’t been any changes in quality I know of, they have a great distribution model, and I don’t see why their costs would have gone up at all to justify that sort of price increase. Just my two dollars and fifty cents…

CEOs and the Real World

Facebook, Personal

The downside of Zuckerberg’s exalted status within his company is that it is difficult for him to get genuine, unexpurgated feedback. He has tried, at times, to puncture his own bubble. In 2013, as a New Year’s resolution, he pledged to meet someone new, outside Facebook, every day. In 2017, he travelled to more than thirty states on a “listening tour” that he hoped would better acquaint him with the outside world. David Plouffe, President Obama’s former campaign manager, who is now the head of policy and advocacy at the Chan Zuckerberg Initiative, the family’s philanthropic investment company, attended some events on the tour. He told me, “When a politician goes to one of those, it’s an hour, and they’re talking for fifty of those minutes. He would talk for, like, five, and just ask questions.”

But the exercise came off as stilted and tone-deaf. Zuckerberg travelled with a professional photographer, who documented him feeding a calf in Wisconsin, ordering barbecue, and working on an assembly line at a Ford plant in Michigan. Online, people joked that the photos made him look like an extraterrestrial exploring the human race for the first time. A former Facebook executive who was involved in the tour told a friend, “No one wanted to tell Mark, and no one did tell Mark, that this really looks just dumb.”

There seem to be three communication gaps outlined here in Evan Osnos’s revealing profile of Mark Zuckerberg: one is getting unvarnished feedback from your employees. Speaking as a fellow CEO and founder, it’s certainly hard to pop that bubble — see “the bear is sticky with honey.” There are a few techniques like skip-level 1:1 meetings, anonymous feedback forms, interviewing new hires, and 360 reviews you can do to try to counter this, but there’s no panacea and this one requires constant work as you scale.

The second gap is getting the unvarnished truth from your users — much easier, as they’re quite happy to tell you what’s what. I’ve recently started cold-calling (yes, on the phone!) some of our Jetpack customers just to understand what they love and don’t love about the experience and about how we can help them solve their business challenges. There’s a casual intimacy to phone conversations that just can’t be replicated in other user feedback forums. Pair this with good instrumentation throughout your product so you see what people do and not just what they say and you’re golden.

The third and last communication gap is the connection to the world as most people experience it. If your status, wealth, or celebrity reach a point that they are shutting you out from “real” experiences, take some risks and get outside of your comfort zone. As it turns out, this new GQ profile of Paul McCartney offered a tip on that:

McCartney tells me a further such story of a time he took the Hampton Jitney, the slightly upmarket bus service that runs from the Hamptons into Manhattan, because he was deep into Charles Dickens’s Nicholas Nickleby and he wanted to finish it, and how he then took a local bus uptown, and when a woman blurted from across the bus, “Hey! Are you Paul McCartney?” he invited her to sit next to him and chatted all the way uptown. “It’s a way of not worrying about your fame,” he says. “It’s a way of not turning into the reclusive rock star. I often say to Nancy: I get in their faces before they get a chance to get in mine.”

Makes me wonder if Jack Dorsey still rides the bus to work every day. I think this is what Zuckerberg was attempting with his 30-state tour, and hopefully it was helpful even if the optics didn’t appeal to everyone — the daily habit of his 2013 resolution to meet someone new every day feels more powerful than the touristic 30-state one. But for an entity as large as Facebook maybe it’s moot, as Casey Newton pointed out in his newsletter last week it can be quite hard to pin the answers to Facebook’s real problems, and our democracy’s real challenges in the face of targeted online propaganda, to just one person.

WhatsApp Takeaway

Automattic, Essays, Tech

whatsappFor better or worse, a great deal of investment in technology is driven by pattern matching. In that world any company (including Automattic) that generally eschews hype, is largely subscription driven, and has a small number of employees relative to its audience should be thrilled at the 19 billion dollar acquisition of WhatsApp. The deal is incredible.

This has kicked off another round of pattern matching and halo effects, which are currently incredibly favorable but will evolve over the coming years based on how things go post-integration, just like the public perceptions of Geocities, Youtube, Doubleclick, Bebo, and Skype wildly shifted based largely on the press coverage over their latest traded value.

I’m thrilled with the outcome for WhatsApp and the manner in which they built their company, their product, and I hope they bring more of that thinking to Facebook, but I don’t think they should become a playbook any more than Instagram should inspire a no-revenue playbook. The pattern we should take away from this story is that there is no pattern. (In Perl, “there’s more than one way to do it” or Tim Toady.) As an entrepreneur making decisions for your company, always go back to your first principles of what’s important to you and why you started in the first place. As a journalist, try not to fit everyone into arcs you’ve seen before or ascribe value to previous coverage (or lack of coverage). As an investor try to evaluate every situation on its unique merits. Should founders be CEOs or not? Well, it depends on the founders, the company, and what it means to be CEO, not what an over-normalized sample of a few hundred companies did before in completely different contexts.

There are also products that succeed with design that seems childish or terrible on the surface (Myspace, eBay, Snapchat). A lot of what it comes down to is have you made something people want, and are they finding out about it from their friends. That’s often the realm people think of as marketing. The best marketers in the world don’t fit our preconceptions of what that word means because they’re in hoodies instead of suits and create environments and ecosystems rather than the traditional trappings of marketing.

Update: From @dsa, here’s a great follow-up read on Techcrunch: What Games Are: Flappy Bird, Patterns, And Context.

What I Miss and Don’t Miss About San Francisco

Essays, Tech

A few months ago I was chatting with John Borthwick, who had just returned from a trip to San Francisco. I asked him how the city was doing as if he were a traveler who had visited someplace exotic — “How is it over there?” (As an investor he probably sees the crazier side of the city, since part of his job is looking at hundreds of companies, the vast majority of which will fail, and trying to pick a few winners.)

Despite getting near-daily meeting requests, I don’t currently have any plans to visit San Francisco. I was there in June for a few days for Foo Camp and for drinks with the artist Tom Marioni. I returned for WordCamp San Francisco in October, and again a few weeks ago for Scoble’s 50th birthday party and a board meeting. But the couple-times-a-year rhythm seems to be enough for me. I’m enjoying the distance a bit, in fact.

There has been plenty written about the bubble culture in SF right now, including on the antitech movement that never really took off. It’s a topic I already blogged about in 2013. But I was curious to unpack my own thoughts about being away from it all.

What I don’t miss:

  • Too many meetings — every possible company is there, and everyone wants to meet.
  • High prices for everything, from groceries to cocktails. Not even going to talk about the real estate market and rentals.
  • It takes forever to get across the city, even though it’s only 7 miles.
  • The public transit, while workable, pales in comparison to other places like NYC.
  • The weather isn’t bad, until you drive to Palo Alto or Marin and notice how much nicer it is there. (Or take a one-hour flight to Los Angeles or San Diego.)
  • This is anecdotal, but I feel like cell phone service is terrible, especially for making calls. Calls are unintelligible and drop frequently. I think this is why everyone texts.

I don’t have any problem with the social scene; SF might be tech-heavy, but it’s fairly easy to get out of the tech bubble. Many forget that San Francisco is home to a ton of people working for non-profits, in fashion, finance, bio-tech, art, and music.

What I miss, deeply: the people. Some of my favorite people, professionally and personally, are in the Bay Area, and that’s the thing that will draw me back someday. I’m lucky that I can catch up with folks when they travel, like Jane or Tony in New York or Om in Italy. Of course the Automattic headquarters is there, along with some great colleagues, but I can also catch up with them at meetups.

I miss how much technology permeates the culture there, from billboards to services like Uber or Postmates (or Munchery or Spoonrocket) that today seem like conveniences, but will be the basis of something very meaningful down the line. You can feel like you’re living in the future there. Internet speeds seem to be getting better, too —  local ISPs like Webpass and Monkeybrains are leading the way, but even my Comcast account there delivers 120mbps.

I miss being able to run along the water, and the close proximity to lots of beautiful nature areas (granted I didn’t take much advantage of those when I was still around). The quality of light is really nice — when you can see it. Restaurants, though tending toward pricey, offer great ingredients and quality.

Finally, you can’t deny it’s a city of hustlers. This tweet has since been deleted, but you get the idea:

https://twitter.com/closetclicks/status/500345852352008193