Costco Takes Responsibility for Matzah Shortage but could social media have played a role?

BlogHer Original Post

When it comes to reporting food shortages, most of the media's attention this week was appropriately on rice---( some say there's a shortage, some say no).

Gut Check writes,

In the grand scheme of things, the matzo shortage doesn’t compare to the lack of rice in Asia or the lack of food of any kind in Haiti. But it does pose a moral conumdrum. Most of us don’t even like the stuff. It’s dry and brittle and sticks in your throat and doesn’t even taste good to compensate. (It doesn’t really taste like anything, so I guess it could be worse.)


Costco is taking responsibility for the shortage. After years of dominating the Passover Matzah market ( causing local retailers to cut back on their matzah orders from matzah manufacturers) Costco and Trader Joe's decided to sit out the 2008 Passover Matzah season.

No one is saying why the sudden exodus -- if typical business norms apply one can assume it had something to do with supply and demand.

According to UPI there was an unexpected spike in Passover Matzah demand this year,

The Chronicle said the absence of matzo at Costco and Trader Joe's plus an apparent spike in demand for the traditional crackly bread quickly cleaned out many other markets. Similar shortages have been reported in Los Angeles, Boston, Reno, Nev., and even Hawaii, the Chronicle reported Wednesday. The newspaper also noted that matzo is nearly impossible to make at home due to the rituals required for the kitchen and the grains.

So the question is, why was Passover Matzah in such demand this year? One theory (okay it's my theory) might be that two very popular viral videos peaked the interest of people who would not normally eat or be interested in eating the less than tasty treat.

There was this video sponsored by Streit's Matzah:

B.L. Ochman wrote about the video early last week--focusing on the viral nature of the video as well as offering Streit's some marketing advice on being more visible about their sponsorship.

The email forwarded to me about the video by a friend said:

This time of year matzah seems to get a bad rap with vicious rumors ranging from being accused of "tasting like cardboard" to "constipating folks for weeks". Fed up with hearing such discriminatory remarks against matzah, and committed to bring about positive change, Michelle Citrin and William Levin have teamed up with Streit's Matzah to bring you 20 things you can do with matzah. Won't you please join our campaign of spreading the gospel o'matzah. Happy Passover. " Did Jewish Robot send it to fuel the viral spread of the video? Dunno. Smart if they did.

It's likely that Streit's is fearful of backlash. The company has a very short annual window of opportunity for matzo sales, since theunleavened bread is the staple of Passover, but not part of the diet of most Jews during the rest of the year.

Anything that adversely affects business could be a disaster. However, since the video is adorable, funny, and basically tasteful, it's hard to understand their fears. Maybe by next year Streit's will feel more brave....

Then there was this Matzvah video from JibJab - which has actually bee around for a couple of years but was just added to YouTube in the past six months.

While there is no way to tell whether or not social media played a role in this year's Matzah shortage, there is also no way to tell that it didn't.

As far as Matzah goes, I've never been brand loyal. In fact, the morning that I watched the 20 Things To Do With Matzah video, I had no idea which brand I had bought the day before. Turns out I had a pink box of Streit's --the sponsor of the video.

Even before I realized I had purchased their brand, I knew the next time I was in the market for Jewish foods I would reach for the Streit's.I loved the video and it made me feel good that the company could laugh at itself about a product people love to hate.

Meanwhile, Costco is promising that next year the Matzah will return. Turns out no one knew that Costco and Trader Joe's had decided to exodus the matzah business. When the discount retailer first began selling matzah several years ago, local grocers had a major surplus of matzah on their hands and so began ordering less because everyone was buying it at Costco.

Costco, for its part, is repenting.

The decision to not stock was made for all of Northern California, said Tracy Mauldin-Avery, who oversees food buying for the region. "We might have made a mistake this year," she said, adding that there was clearly an opportunity to sell.

She said at least 10 stores in the Bay Area would carry matzo next year, including stores in San Francisco, Sunnyvale, Santa Clara, San Jose's Almaden district and Foster City.

She called those stores places "where we absolutely should have had it this year and we will next year."

Which brings me back to Streit's sponsorship of the video that went viral. As B.L. Ochman wrote," Anything that adversely affects business could be a disaster" -- Costco's and Trader Joe's decision to get out of the Matzah Market certainly qualifies as a potential disaster.

Did Streit's commit to the video before or after they got the news that Costco and Trader Joe's weren't buying this year? In sponsoring the video did Streit's think it could help matzah sales? And in particular, sales of Streit's matzah.

It is curious that the matzah makers didn't inform the regular retailers that their main competition, Costco and Trader Joe's were on the sidelines this year. While there could certainly be several explanations for the non-disclosure, one could be that the matzah makers decided to let nature take its course --knowing that a shortage would heighten the awareness and yes, the appreciation of all things unleavened ensuring that in 2009 Matzah would have a bumper sales season.

Elana writes about business culture a FunnyBusiness

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