This Foodie Friday, let’s talk about Big Food. No, not the somewhat passé trend of stacking a dish’s components into a tower. Big Food – the large food processors who account for a lot of what we have in our homes and, eventually, in our stomachs. There is a revolution going on and it’s one that provides some guidance for all of us no matter what our business may be.
You saw another manifestation of the revolution in this week’s announcement by Taco Bell and Pizza Hut that they will be phasing out artificial ingredients in their food. McDonald’s is getting rid of antibiotics and Subway will be making their bread without some unpronounceable substance which has been called the “yoga mat chemical”. I’m assuming those things got there to begin with in an effort to make the products more consistent, less expensive to produce, and more appealing. All of those reasons are kind of selfish when you think about it. They help the company while putting the long-term health of their customers at risk.
If you want an in-depth discussion of what’s going on with Big Food, Fortune has an excellent, well-researched piece which you can read here. It contains this quote from a Hershey executive:
Research had found that 68% of global consumers wanted to recognize every ingredient on the label, and 40% desired food made with as few ingredients as possible. “There is a connection in consumers’ minds between overall health, wellness, and knowing exactly what I’m eating,” says Hershey’s head of global R&D Will Papa. “Consumers want treats, and they want to know that the treat is really good and wholesome.”
Consumers are not just giving that lip-service. Organic food sales more than tripled over the past decade and increased 11% last year alone to $35.9 billion, according to the Organic Trade Association. And one analyst said that the top 25 U.S. food and beverage companies have lost an equivalent of $18 billion in market share since 2009.
Why is this important to your business? It demonstrates how we all need to be in lock-step with the changing priorities of our customers. It might be easy to write off a decline in sales to a bad quarter or the weather. It takes foresight and guts to recognize a shift in tastes (pun intended) and to disrupt everything from product formulation to your supply chain. Good companies might look to maintain sales and profits by cutting costs or running promotions. Great companies listen to their customers and respond. Which are you?