The Economics Of Hot Pockets

October 23, 2014 in Daily Bulletin

Sales of hot pockets are nose-diving. The excellent Venessa Wong looked at what went wrong:

  • In a time of increasing health consciousness consumers are turning away from the pastries famous for the gooey mix of meat and cheese within.
  • In response the makers of hot pockets tried to rebrand the product emphasizing the ‘premium’ cuts of meat and ‘real’ cheese contained within. It hasn’t worked.
  • A beef recall further dented┬áthe product’s┬áreputation.
  • One of the biggest factors affecting sales however might be the expiration of extended food stamp benefits.
  • The frozen pockets are fairly economical, with each one costing less than a dollar, making them popular with lower income individuals.’
  • Hot pockets aren’t the only food affected. The expiration of federal subsidies is changing the supermarket landscape.

Find out about the failing Funny or Die marketing campaign, what executives have to say, and more over here.

Source: Bloomberg BusinessWeek