CHICAGO — Consumer perception of a company and the products it produces stretches well beyond the supermarket shelf or restaurant menu. As information has become more democratized, consumers have a wide range of information sources that may influence how they perceive a company or a particular ingredient. Ensuring consumers and customers have ready access to the information they require when they want it regarding a company’s practices is a central strategy to combating misinformation and misunderstandings.
Nearly half (48 percent) of consumers currently do not feel adequately informed about a product even after reading its label, and two-thirds of consumers hold the manufacturer/brand accountable for communicating critical product information to make an educated purchasing decision, according to data presented Oct. 18 at the TransparencyIQ conference that was held in Rosemont, Illinois.
“Consumers expect transparency from brands, but brands aren’t delivering,” said Patrick Moorhead, chief marketing officer for Label Insight, Chicago, the sponsor of the conference. “Only 12 percent of consumers consider brands as their most trusted resource for information about what’s in their food. Most consumers turn to their phones, tablets or PCs to find more information online.”
Examples of food and beverage companies becoming increasingly transparent abound. This past October, for example, the Campbell Soup Co., Camden, New Jersey, Nestle USA, Arlington, Virginia, and the Kraft Heinz Co., Pittsburgh, announced commitments to improve the welfare of poultry used for food production in the supply chain. Nestle committed to ending the use of crowding in the housing of chickens, improved lighting standards and the ending of live-shackle slaughter and switching to controlled-atmosphere stunning. The Kraft Heinz Co. and Campbell Soup made similar pledges and the companies have set a goal of achieving the transition by 2024.
“We want to help bring about positive change at every level of our supply chain — from our direct suppliers all the way back to the farms,” said Paul Grimwood, chairman and CEO of Nestle USA. “We have already pledged that by 2020 all of the eggs we source as ingredients for our food products in the US will come from cage-free hens. Today, we are taking the next step in that journey to help push for higher standards of welfare for broiler chickens.”
As most companies have found, the commitment to improve welfare of broiler chickens is no small feat, Nestle said, calling it a “complex undertaking.”
“Such changes require investment and time, and the transition over the next seven years must be done in a sustainable and cost-effective way,” Nestle USA said. “We look forward to working together with our US broiler chicken suppliers and others in the food industry, as well as farmers, NGOs and our customers to drive progress. This matters to our consumers who expect affordable, high quality foods without comprising on animal welfare, and it matters to us. We will strive to meet these standards in our US supply chain by 2024.”
Consumers respond to openness
During the TransparencyIQ conference, Jay Porter, president of Edelman, Chicago, provided insight as to why transparency is so critical, at a time when consumer trust in business, media, government and non-governmental organizations (NGOs), which are non-profit, voluntary citizens’ groups, and third parties, continues to decline.
“The world wants more from brands,” Porter said. “More than half of respondents believe brands can do more to solve social ills than the government.”
He explained how shared beliefs are the most powerful driver of commitment. This requires deeper transparency on a wide range of issues.
“Consumers increasingly want to know that a brand, a company is with them,” Porter said. “It’s not just about your product or even your supply chain.”
Fifty-seven percent of consumers surveyed for the 2017 Edelman Earned Brand study said they are either buying or boycotting brands based on the brand’s position on a social or political issue. This is up 30 percent in the past three years. Half said they are belief-driven buyers, with 65 percent of belief-driven buyers saying they will not buy a brand because it stayed silent on an issue it had an obligation to address.
“Speak up and they will buy loyally,” Porter said. “Speak up and they will pay a premium.”
Retailers are adding transparency
The focal point of the Food Marketing Institute’s US Grocery Shopper Trends 2017 report is transparency. The research, according to the trade association, signals that US consumers want more than just information from the companies that produce the products they buy. They also want a level of transparency that offers assurances of food safety, health and wellness and ethics in the production of those products.
The regional retailer Raley’s, West Sacramento, California, is the latest supermarket chain to adopt a transparency initiative to better inform its customers about the products the company sells. Its Shelf Guide combines current food trends and research to set standards for packaged foods claims and provide transparency.
“We knew that Raley’s could develop a program that truly addresses the needs of our customers and serve as a trusted adviser,” said Michael Teel, CEO. “Raley’s Shelf Guide attributes will help our customers make easier decisions when shopping our stores. Only foods that meet the strict standards of Raley’s will qualify for the Shelf Guide tags. I challenge food manufacturers to aspire to meet our Shelf Guide standards for their products at Raley’s.”
For ease of use, icons are placed directly on a product’s shelf tag that also displays its price. The top two icons are shared on the tag in-store. Customers seeking value at the shelf now will be able to use the Shelf Guide to identify an option at an affordable price that they perceive to be better.
The program was independently developed by Raley’s in partnership with Label Insight.
“Many consumers are driven by health and wellness goals, including special diets and ingredient allergies and aversions,” said Ronak Sheth, chief customer officer at Label Insight. “Raley’s Shelf Guide has taken Label Insight data to the next level by using rigorous criteria designed by a certified dietitian to evaluate product ingredients and processing. Raley’s has gone above and beyond typical ‘organic’ or ‘non-GMO’ attributes to include criteria for sodium, sugar and fiber content by individual category, making them unique in the industry.”