Startup Bodega seeks to disrupt mom-and-pop shops, but found people weren’t as excited about their business as they were.
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Startups are always looking to disrupt older business models and become the leaders in the new business model they establish. People behind the startup Bodega were seeking to do just that by installing kiosks with essentials goods in building lobbies, gyms and other places that receive foot traffic. The startup Bodega was named after a type of small convenience store, usually found in New York City and Los Angeles, that provides products needed on short notice. Outrage started as soon as the company was announced, leaving the business to explain how they came up with its name.

Bodega’s branding

Bodega’s problem isn’t with its technology; it’s basically invented a fancy vending machine that lets you reach inside for what you need while being viewed by a camera. Their real problem is the branding. The name bodega associates the company with a kind of store that means so much to many different people. In the short time since they launched the company, they’ve managed to reach a high level of infamy.

They’re also being accused of cultural appropriation. Frank Garcia, head of the New York state coalition of the Hispanic Chamber of Commerce, was outraged by the name of the company. He told, “Why are you using the Hispanic name — why are you doing that? My grandfather must be rolling over in his grave right now. When a bunch of Puerto Ricans starting calling [their stores] ‘bodegas,’ they didn’t intend them to be vending machines. The intention was to support immigrants.”

Outrage came from all directions, managing to upset everyone except the founders of the company. People took to Twitter to voice their dissatisfaction with the name.

Silicon Valley is still out of touch

If you have to survey the Latin American community to find out whether your name is appropriate, it may not be a good idea to go through with the name. Cultural tensions are at an all-time high, and in an environment under the stress of forces such as the president and Charlottesville, it’s a bad time to be associated with anything racially insensitive. The fact that someone signed off on this name just adds to the narrative that Silicon Valley is out-of-touch and insular.

Bodega’s name may not be its only problem, its business model presents issues as well. Bodega’s founders solved a problem that doesn’t exist. Its first wave of machines was placed in 50 locations in the Bay Area last week, and instead of solving problems that affect those in the Bay Area, such as low availability of affordable housing, the problem of not wanting to walk to a corner store was solved.

Another startup with similar launch problems was SceneTap, which let users know how many women were in certain bars using facial-recognition technology. It was launched without consideration for how insensitive such a product would be. People, and especially women, don’t love to be spied on. The problem is with Silicon Valley, they’re working and wasting brainpower to solve problems that don’t exist, such as death.

Takeaway: Bodega’s launch showed everyone what not do

Based on just its name, Bodega is now saddled with infamy. Nobody cares about the technological breakthroughs with its service, they are now just focused on the name. Poor branding will force the company to shift from dealing with its launch to dealing with the public-relations disaster that its name created. Bodega will probably have to change its name in order to continue and get away from the problems it has created.

When the founders chose the name, they failed to realize that these stores loom large in the makeup of people’s neighborhoods. They didn’t count on people knowing these business owners by name and the personal relationships that people have built with those who provide them with what they need almost every day. Bodega’s ownership failed to realize the cultural insensitivity that would come from choosing a Hispanic name for the kind of businesses that they’re trying to put out of business.

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Header image: Adobe Stock


Posted 09.19.2017 - 03:00 pm EDT