Making a Play for Hearts, but Guarding Her Purse

Zehavit Cohen, CEO of Apax Partners, Tnuva Dairy's biggest shareholders, speaks to the media about the consumer protest against high dairy produce prices; says protest 'just' and 'painful.'

On Friday night Zehavit Cohen faced Channel 2 television cameras, breaking a 10-day silence in a bid to win hearts and minds in the ongoing cottage cheese wars.

"This week wasn't a simple one for me," said the CEO of Apax Partners, Tnuva Dairy's biggest shareholder, calling the recent events "painful." The dairy would not be reducing its prices, but neither will it be raising the price of cottage cheese this year, Cohen said.

Apax CEO Zehavit Cohen - Ofer Vaknin - June 26 2011
Ofer Vaknin

There was nothing new, however, in her prime-time interview with Channel 2 and the Yedioth Ahronoth mass-circulation daily. Cohen had apparently received the same prepping as her big-dairy counterparts who said their lines earlier last week. Her script was peppered with similar catchphrases. "This is a painful, just protest," she said. "I saw the problem as early as the beginning of the year."

Cohen's tactic of "internalizing the protest" as a response to grassroots anger can work for you, too. Your kid is screaming and you're on the phone all day? Your spouse is upset that you're coming home too late? Mom says you haven't called in two weeks? Internalize their protest. Say you understand, that their complaints are justified (and painful ). Feel their pain. You can add that you had a rough week. Cohen had a rough week, too. Say you're not the kind of person who "rushes to make populist declarations." Because "it's simply not me."

Cohen's speech offers more fodder for resolving domestic disputes: "I've already said we need a package deal." "We need a real solution, not a Band-Aid for cancer." "I prefer going with the facts rather than intuition." Refuse to make promises. It won't cost you a thing, and it'll calm your adversary immediately.

Cohen responded properly - every word was precise - but she left viewers feeling they had no partner for dialogue.

Ever since consumers launched their cottage cheese boycott over rising prices 10 days ago, Tnuva has said very little. It hoped it would blow over. But unfortunately for the dairy, no new crisis has taken its place: there have been no major wildfires, nor mobile network crashes, that could steal away headlines. Meanwhile, the cottage cheese protest has only gained momentum.

If Tnuva had its way, no one would be talking. Even the fact that Tnuva CEO Arik Schor was forced to answer tough questions at a food conference last week caused the company no small amount of discomfort. Both Cohen and Schor spoke precisely. So precisely, in fact, that it was hard to be moved by their words. Anyone who has ever sat down with Cohen knows she is a likable woman, with a knack for saying the right thing at the right moment.

"I know the truth, and to jump on television with populist declarations is not me," Cohen said in response to a question from Channel 2 reporter Keren Marziano. "Why haven't you said anything until now?" As opposed to Strauss Group chairwoman Ofra Strauss, who asked out loud whether mistakes had been made, Cohen refused this explicit invitation to express remorse.

The problem is that Tnuva needs to face the truth. And the truth is simple: Apax bought the dairy as a $1-billion investment in order to boost its value and then to sell it. At the time of purchase, Tnuva and Apax officials talked about turning the company into an international brand, but in practice Tnuva has focused solely on the domestic market. Apax has doubled Tnuva's value because of the dairy's real estate holdings and because of price hikes, particularly of products that are no longer subject to government price controls, and where Tnuva controls the market.

Apax's Tnuva has succeeded because it can raise the price of certain products, leaving consumers with no choice simply because there are no alternatives on the shelves. Maybe that's why the company was surprised by the force of the response when it raised its cottage cheese prices. After all, for the past two or three years they've been telling consumers that higher powers were in play, and consumers said nothing and reached deeper into their pockets. Apax and Tnuva were shocked because they failed to predict the public mood. They failed to realize that consumers were fed up with earning less, paying more taxes and being unable to meet their mortgage payments. They didn't understand just how much it irritated consumers to pay NIS 7.50 for a 250-gram tub of cottage cheese, that Israeli staple.

Businessmen like to call the prevailing spirit "antibusiness." It's not antibusiness, it's actually pro-business. It's in favor of a more equal division of resources and opportunities. Average Israelis apparently understand that they will never be rich, and are fed up with the big businessmen who keep snapping up companies. It's not that they're mad at them, they just wish they would leave a little bit more for others.