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The Success of Peppers You Can’t Eat
by Stephen Ausherman
It’s no secret that Starbucks is making a killing in the sales of their logo-embossed souvenirs. Their customers don’t seem to mind paying top dollar to display the object of their addiction on T-shirts, mugs, and kitchenware. So it stands to reason that they’ll do the same for the companies that manufacture other addictive foods, particularly those of the fiery sort.
Chip Hearn doesn’t run Starbucks, but he recently sold his Starboard Restaurant in Dewey Beach, Delaware, famed for a Bloody Mary smorgasbord that offers a choice of a few hundred hot sauces. He also owns Peppers, a hot shop and wholesale business with annual sales revenue that can exceed $2.5 million.
Hearn couldn’t say how much of those sales are from nonfood items. Accurate estimates are difficult to make, especially considering additional factors of nonfood sales--indefinite shelf life and the relatively small amount of space they take. And with so much of his energy going into developing award-winning sauces, he showed little concern for his nonfood market. "We’re not pushing it," he said, pointing out that nonfood items aren’t even listed in the Peppers catalogue. "But it’s growing big time."
Other shops have noticed. Hog’s Breath Saloon in Key West, Florida prides itself on "World Famous T-Shirts" and sells about a hundred different nonfood products, yet only six varieties of sauces and seasonings. "Sales are definitely up from last year," said office manager Michelle Raley, adding that Hog’s Breath plans to expand their catalogue with a women’s line of clothing. She attributes a high volume of sales to the fact that their phone number and Web address appear on most products. But more importantly, she credits the Hog’s Breath logo. "Everybody wants the logo," she said. "Especially on our classic design T-shirt."
At the Chile Pepper Emporium in Albuquerque, New Mexico, owner Sherrie Tenorio said that while nonfood products make up only about a third of her inventory, they account for about half of the sales. At Hot Stuff of Saratoga in New York, about thirty percent of the in-store sales are from nonfood items, according to the proprietor, Melanie Dallas. However, she adds: "We’ve been online (www.hotstuff-of-saratoga) since July 1998 and have found that more nonfood items are being ordered than fiery food products." She estimates that nonfood items account for about 60 percent of her online sales.
Increasing Sales and Customers
Nonfood merchandise can also help diversify the customer base, according to Dallas. "Basically, you don’t have to eat hot and spicy to wear a cool T-shirt or decorate your kitchen in chile pepper motif. People who would not normally come into our store because they don’t like hot stuff are attracted by these unique nonfood items."
The popularity of nonfood products contributes to their effectiveness as marketing tools. They’re inexpensive to manufacture and, once sold, they’re a cost-free form of advertisement. As Hearn put it: "The beauty of something like [T-shirts] is you’re advertising my products for the life of that garment."
Of course, as advertising costs go, radio spots and magazine ads don’t sit around the store taking up shelf space. To the consumer, however, a radio spot is an unwelcome interruption at best, while a T-shirt with a logo is like a souvenir and has value. To a manufacturer, the same item is a
promotional product--a popular, cheap, and effective form of marketing.
According to Promotional Products Association International, a nonprofit trade association, promotional products are no longer a trinket-and-trash trade, but an industry with annual sales of $11.9 billion and growing fast. Increasing sales are only part of the reason why the promotional products industry is growing so quickly. PPAI reports that product recipients want more expensive items. Who doesn’t? Especially when companies give them away. Inferno Vodka in Grimsby, Ontario, Canada, often gives away quality oven mitts bearing their logo in exchange for recipes that call for their hot vodka. Inferno Vodka president John Hall said his giveaways have increased traffic to his Web site.
Companies are willing to cater to these consumer demands, believing that the more expensive items will be used longer and more often, ultimately boosting name recognition. And it doesn’t hurt to have a company name tied to a quality product, such as a ten-dollar pen, as opposed to a two-cent pencil. These and other marketing strategies, as well as informative articles and surveys, are available at www.promotion-clinic.ppa.org.
Off-Color Products are Red Hot
The ambiguity of "hot" is irresistible to many in the fiery foods industry. Some manage to come up with clever sexual innuendo, while others seem to get their ideas from the clearance rack at Spencer’s--or worse, from the annals of "South Park." In any case, the trend toward vulgarity seems to indicate that American tastes aren’t just growing more tolerant of increasingly hot sauces, but of humor that was once considered risqué or just plain lewd. In short, shock value is at an all-time high. "These items are unique and appeal to both ‘hot heads’ and people with a good sense of humor," said Melanie Dallas, proprietor Hot Stuff of Saratoga, in reference to their "Bite Me" T-shirts.
Aprons top the nonfood sales at both Hot Stuff of Saratoga and Chile Pepper Emporium. Chile pepper pottery and ristras made from chile pepper lights are among the other best-selling items. "The game is with Southwestern themes. That means anything to do with chile peppers," explained Chip Hearn. "People will buy tremendous amounts of these products... sight unseen."
The pepper appeal has not escaped the notice of Fred Begun at DC Enterprises. According to Begun, DC Enterprises has found a niche in chiles after ten years in thematic clothing and apparel featuring designs inspired by wine, wildlife, flags, and other motifs. "Chile designs are now a pretty vital segment of our inventory," he said.
So for those who sell foods containing chile peppers, working this popular icon into their logo isn’t much of a stretch. The bigger problem might be in deciding what kind of product best carries a logo. Keychains, lighters, bottle openers, golf balls, pins, hats, shot glasses, posters, ceramics, dish towels--the choices can be overwhelming.
According to PPAI, the most popular items fall into the clothing category. To narrow that down further, Begun of DC Enterprises said that "socks and boxers have been pretty hot for the last year and a half. While that’s unfortunate news for those wishing to expose their message to the public at large, other distributors report that T-shirts are still holding strong, particularly in tourist destinations such as beach towns.
But in the end, what will actually sell is anybody’s guess. When considering a product for retail sales, the best strategy is to get as much input as possible. "What I personally think isn’t enough," said Hearn. "I have to listen to the whole management team."
Remember too, that popular nonfood items in hot shops aren’t limited to promotional products. Ten Speed Press, a publisher that focuses on food, has also found a niche in chiles. But how many books and posters about peppers can they sell? "A plethora," according to Dennis Hayes, new markets director. With pepper publications numbering "thirty and counting," Ten Speed Press plans to focus more on specific peppers and the regions where they’re grown. As Hayes put it: "The well is far from dry."
Benefits of Capsaicin Without the Burn
The chile-induced nonfood market doesn’t end with books, bottle huggers, garments, glassware and other gewgaws. Peppers, long touted for their healing powers, are also prominent in dietary supplements, an industry that grew from $3.3 billion in 1990 to more than $10 billion in 1996, although more conservative estimates state that U.S. consumers spent more than $6.5 billion on dietary supplements in 1996.
Traditionally, capsaicin has been used in many countries as a part of salves or creams to treat rheumatic pains and arthritis. In small amounts, it can produce numbing of the skin and have a slight anti-inflammatory effect. For centuries, it has been considered helpful against ailments of the circulatory system and the gastrointestinal tract, including stomach aches and cramps.
As a modern dietary supplement, capsaicin has been on the market for years under the more familiar name cayenne or cayenne extract. Of the many claims concerning capsaicin today, the more commonly accepted ones indicate that it is an effective anticoagulant, thus possibly helping prevent heart attacks or strokes caused by blood clots. Its topical numbing effect is potent enough to treat mouth pain in chemotherapy patients. Also, chiles are high in vitamin C--ounce for ounce, a hot pepper contains over 350 percent more vitamin C than an orange--which may be effective in preventing certain types of cancer. Vitamin C is an antioxidant, a chemical substance capable of diminishing free radicals, which can cause cells to mutate. And red peppers are a good source of beta carotene, which is converted by the body to vitamin A.
So why don’t folks just eat more chiles? Justin Meeks, assistant manager at Vitamin World explained: "A lot of people can’t handle the pepper--even here in New Mexico." And if the bare shelves at stores in Albuquerque are any indication, cayenne dietary supplements are selling out fast, at least in these parts. General Nutrition Companies, Inc., the only nationwide specialty retailer of vitamin and mineral supplements, and herbal products, sells three cayenne brands in their stores, but does not list cayenne among its "Top 200" products.
The bottom line is that nonfood items such as cookware, giftware, books, and dietary supplements, can increase customer base and profits. If promotional items such as T-shirts, posters, and pens are sold or given away in conjunction with food products, they can increase sales, even if given away. "The giveaways primarily serve as reminders," says an article in the Los Angeles Times, based on a study by Avraham Shama and Jack K. Thompson of the University of New Mexico. "The premise behind sampling is that if you try a product or service, you’ll like it. And once you like it, you’ll buy it."
Stephen Ausherman is a freelance writer/photographer who has worked in several countries, including Vietnam, Iraq, Nigeria, China and India. A Chapel Hill native and UNC graduate, he now lives in Albuquerque and spends too much time in his garden.
Sources
Chile Pepper Emporium
328 San Felipe NW
Albuquerque, NM 87104
PH: (505) 242-7538
or
89 Winrock Center NE
PH: (505) 881-9225DC Enterprises
Marc Begun
425 Queens Lane
San Jose, Ca 95112
PH: (408) 453-7843; FAX: (408) 453-7848Hot Stuff of Saratoga
Melanie Dallas
10 Phila St.
Saratoga Springs, NY 12866
PH: (877) SPICY-99
e-mail: spicytoga@aol.com
Web site: www.hotstuff-of-saratoga.comInferno Pepper Pot Vodka
John Hall
Grimsby, Ontario, Canada
PH: (905) 945-9225Peppers
Chip Hearn
2009 Highway One
Dewey Beach, De 19971
PH: (800) 998-3473; FAX: (302) 227-4603Ten Speed Press
Dennis Hayes
P.O. Box 7123
Berkeley, Ca 94707
PH: (510) 559-1600; FAX: (510) 524-4588