Certain brands are more than just products — they’re iconic pieces of the American landscape, engrained in the fiber of the culture. Of course, no matter how sentimental we might get, the simple fact remains that the free market has a short memory. When tastes change, even the most recognizable sellers will have to change with them or risk obsolescence — like Kodak.
Click through to see which classic brands are showing bad trends for investors.
Adolphus Busch, a German immigrant who arrived in America in 1857, went to work at a brewing supply company. Busch ended up marrying the daughter of his client Eberhard Anheuser and joined his company after the Civil War. In 1880, Busch took over the company, one year after it was renamed Anheuser-Busch.
Busch would go on to revolutionize the beer industry, incorporating refrigerated rail cars and pasteurization to start shipping his beer across the country and turning it into a national industry.
Check out the huge corporations that own companies like Budweiser.
Budweiser: What’s Happening?
Budweiser was knocked out of the three top-selling beer brands in the country last year, another fall from the No. 2 spot it held in 2011. More troubling, Miller Lite has “passed” Budweiser, and its sales declined by 375,000 barrels.
The culprit? Most likely the increased popularity of craft brew and more flavorful beers. Just a decade ago, the top 10 beer brands made up 66 percent of beer sales, a figure that has plunged to 50 percent today.
Ray Kroc was a traveling salesman who had spent most of his life bouncing from job to job when he discovered a burger restaurant in San Bernardino, Calif. It was called McDonald’s. Kroc convinced the brothers who owned the restaurant to franchise it. As of 2016, there were 36,899 McDonald’s restaurants worldwide.
McDonald’s: What’s Happening?
Same-store sales, a key factor in calculating restaurant sales, have been headed south for the last five years. When McDonald’s introduces its all-day breakfast it helped some, but sales continue to show declines.
Fast-casual restaurants like Chipotle have changed the food landscape in America, offering much better quality without sacrificing speed and convenience. Pair that with an increased focus on healthy eating and McDonald’s best days appear to be behind it.
In 1886, Atlanta pharmacist Dr. John S. Pemberton created a flavored syrup to mix with soda water and started selling the concoction for 5 cents a glass. It was his partner, Frank Robinson, who named the beverage and wrote “Coca-Cola” on the labels in the now legendary script. Today, nearly 2 billion people around the world drink Coca-Colas every day.
Coca-Cola: What’s Happening?
People are drinking a lot less soda pop as concerns about healthy eating persist. Total carbonated beverage sales dropped by 0.8 percent in 2016. Bad as that was, it beat the declines of 1.2 and 0.9 percent in the two years preceding it. Diet Coke took a harder hit, with sales down 4.3 percent. Since 2004, total carbonated beverage sales are down by 1.6 billion cases a year.
Toys “R” Us
In 1948, Charles Lazarus opened a store called Children’s Bargain Town in the District of Columbia, which eventually became Toys “R” Us. It was originally a children’s furniture store, but the shift to selling toys helped catapult the business to national success.
Toys “R” Us: What’s Happening?
Toys “R” Us is going out of business. After filing for bankruptcy last year, the chain is now preparing to liquidate its American assets. The combination of losing market share to online retailers — Amazon saw toy sales grow 24 percent, to $4 billion, from 2015 to 2017 — and a botched effort to take the company private were too much for the classic retailer.
Ruth Handler watched her daughter, Barbara, playing with paper dolls one day in the 1950s and got an idea. She launched her Barbie doll line in 1959 and co-founded Mattel, one of the biggest toy companies in the world.
Barbie: What’s Happening?
Barbie sales are in the tank and have been declining for years, shaving a quarter of their value over the last five years. In 2017 alone, Mattel’s Barbie sales declined by 6 percent. Doll sales are actually on the rise, but Barbie is facing stiffer competition from other brands and is losing popularity among today’s kids.
In 1930, Herm Fisher saw the need for a higher quality toy for preschool-aged children and decided to do something about it. He founded Fisher-Price with Irving L. Price and Helen M. Schelle. The company had considerable success marketing developmental toys for young children.
Fisher-Price: What’s Happening?
Traditional toy brands like Fisher-Price, which has been owned by Mattel since 1993, are on the decline. Mattel predicted a weak fourth quarter last year just two weeks before Christmas, blaming lagging sales on “certain underperforming brands.” Fisher-Price sales fell 15 percent last year, and the Toys “R” Us bankruptcy played a significant role in the decline.
Kraft Mac & Cheese
The Great Depression inspired Kraft to make its classic, boxed mac and cheese. Kraft introduced the product in 1937, and because it fed four people for just 19 cents, it quickly caught on. The company sold 8 million boxes in a year and never looked back — Kraft Macaroni & Cheese became an American dinner staple.
Kraft Mac & Cheese: What’s Happening?
Kraft’s iconic brand has seen competition from higher-quality, healthier mac and cheese options that have eaten away at its sales — it lost 2 percent of the total macaroni and cheese market from 2012 to 2016. The brand is fighting back, though, and has boosted sales by removing artificial dyes from the classic recipe.
Hamburger Helper was launched in December of 1970 as part of a response to the rising price of beef, giving consumers the chance to stretch a single pound of ground beef into a meal for the whole family. It was a hit, with more than 25 percent of American families purchasing the product in its first year of existence. As for the iconic “Helping Hand” mascot, that didn’t debut until 1977.
Hamburger Helper: What’s Happening?
Hamburger Helper, owned by General Mills, commanded 61 percent of the dinner mixes market as recently as a decade ago. As of last year, however, that number had fallen to 40 percent, a decline of more than 30 percent. The company even dropped the “Hamburger” from its name to reflect the dropping popularity of beef after sales tanked 14 percent in 2012 alone.
Compare: Are Generic Brands Really as Good?
Chef Ettore “Hector” Boiardi came to America in 1914, and he started a business selling takeout meal kits — consisting of his popular take on spaghetti — that would lead to him launching the Chef Boiardi Food Company in 1928. Marketing wizards changed the spelling of his last name to make it phonetic, and it quickly became a standard canned food in America’s pantries.
Chef Boyardee: What’s Happening?
Sales are down for Chef Boyardee products, and the company closed its Milton, Penn., plant. Chef Boyardee’s share of shelf-stable, ready-meal sales declined 8 percent over the last decade.
Tootsie Roll Industries
Leo Hirshfield started selling his hand-wrapped little candies out of his Brooklyn store in February 1897, naming them after his daughter Clara, whose nickname was Tootsie. Hirshfield started delivering them with a horse and carriage and in 1922 he took the company– Sweets Company of America — public. Today, the company produces 64 million Tootsie Rolls a day.
Tootsie Roll Industries: What’s Happening?
Americans are eating much less sugar in an effort to be more health conscious, which is eating into candy sales in general — and Tootsie Rolls in particular. The company saw stagnant sales turn to declining sales in 2016 and 2017.
Richard W. Sears moved his fledgling watch company to Chicago in 1887, where he joined forces with Alvah C. Roebuck. They launched a mail-order business that grew into a massive department store empire, which remained the largest retailer in America from the end of World War II until Kmart surpassed it in the 1980s. In 2004, the companies merged.
Sears: What’s Happening?
Since June of last year, Sears has announced the closing of some 329 Sears and Kmart locations. The company lost more than half a billion dollars last year, which was actually an improvement over the year before when it lost nearly three-quarters of a billion dollars. Same-store sales fell more than 15 percent last year, which marked the sixth straight year of sales declines.
Red Robin started out in 1940 as a restaurant in Seattle called Sam’s Tavern. Sam, the owner, liked to sing the song “When the Red, Red Robin (Comes Bob, Bob, Bobbin’ Along)”, which is where the new name originated. Things took off in 1979 when regulars Mike and Steve Snyder became the first franchisees. From there, the store grew to more than 175 locations by 1985 and more than 500 by 2015.
Red Robin: What’s Happening?
Red Robin’s stock lost nearly a third of its value in November 2017 after the company reported declining profits and same-restaurant sales. The burger market has gotten more competitive in recent years, making it pretty difficult for sit-down restaurants like Red Robin to keep attracting customers.
In 1921, when a health clinician spilled some wheat gruel onto a hot stove and saw them turn into golden wheat flakes, he dubbed them “Washburn’s Gold Medal Whole Wheat Flakes.” He changed the name to Wheaties, and the brand gained popularity in the 1920s when Lou Gehrig and 46 of the 51 players on the 1939 Major League All-Star team gave testimonials for the cereal. In the late 1950s, the company signed sponsorship deals with sports legends, who would appear on the box, which explains the slogan “The Breakfast of Champions.”
Wheaties: What’s Happening?
People just aren’t eating much cereal anymore. As consumers continue to gravitate toward healthier, fresher food, many classic brands are taking a heavy hit. What’s more, 40 percent of millennials said that cereal was “inconvenient” to eat in 2015. General Mills, Wheaties’ parent company, reported that 2017 marked the third straight year of declining sales.
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