What do consumers know about your supply chain?

Consumers. A jaded and cynical bunch. I include myself in that statement.

Just last weekend, a lovely salesperson was extolling the praises of a new smoothie product (“would you like to try it sir, it’s packed with fruit”), while I was remembering comments from my children about the level of sugar in smoothies and trying to see what was on the ingredients panel.

Studies by the Hartman Group would suggest that consumers are interested in more than just what a product’s packaging looks like, instead wanting to know:

  • What ingredients are in the food or beverage product (64%);
  • How a company treats animals used in its products (44%); and
  • From where a company sources its ingredients (43%).

Of course, that’s not to say we are always completely logical and analytical. When I buy Bella Pane bread at our local farmers’ market, I don’t ask to see the ingredients list, or the best-before date, or ask when it was made. Probably Mike has already told me he got up at 3am to bake the day’s bread, but even if he hasn’t done so, I gain a level of confidence and trust from his local proximity, previous discussions, and the farmers’ market brand story.

That level of trust and confidence in product quality, source, and ingredients is what supports positioning of premium food products. A large North American corporate recently discovered that promising “Food with Integrity” was only a start, and those promises needed to be backed with processes and checks to maintain confidence in their products.

I’ve spent a while recently considering how the information we collect on farm can support the broader story about premium protein products. The Hartman Group research would tell us that consumers in the US are interested in:

  • Hormone free (52%);
  • Free of antibiotics (49%);
  • Artificial (48%);
  • GMO-free (41%); and
  • Organic (31%).

When it comes to animal welfare consumers want to know that companies avoid inhumane treatment of animals – and while they may not know the details of what that means, the proportion of people who care is rising:

  • Other animals are not harmed in capture/raising (e.g. bycatch) (68%);
  • Animals are raised in as natural environment as possible (65%);
  • Animals are not used for product safety testing (65%);
  • Animals are not given hormones or antibiotics (63%);
  • Company supports animal welfare causes/organisations (51%);
  • No animals at all used in products (45%); and
  • Animals fed only organic food (33%).

We know that products and processes that meet these criteria – and more importantly, have a compelling story in these areas – may command a premium in the market, and are in a position to build stronger, more defensible brands.

Consumers expect products and brands to live up to the brand story they are told. When lack of integrity in process or supply chain is exposed, consumers act angrily, as though we have been “tricked” (read Seth Godin’s “All Marketers are Liars” to learn more of how this works).

For that reason, any claims we make about our agricultural products having green origins or being “very pure indeed” need to be backed up by guides, processes and records that demonstrate our commitment to those brand values. Claims of greenness or purity are potentially for naught if we don’t have both safeguards and evidence in place.

Hence the importance of Farm Assurance or Good Agricultural Practice programmes, and the need for audits and for simple to use, on-farm record keeping tools that back up the story. We’re working on some of the latter with our partners. It’s hard work, because farmers are busy people with limited finance. In order for supply programmes to really deliver the benefits promised by the brand, I think we need to do two key things:

Link the activities to the brand story

Make sure everyone who has a role in the supply chain understands how their role contributes to the brand and to the consumer experience. Spell out how actions on farm impact the supply chain: safety, provenance, and in-market claims. Ensure staff know the risks to the business if product integrity fails.

Make it easier to comply than not

Most audit schemes today run on paper – recording pages in a paper book or filling in forms. For practical reasons, these are filled in at the farm office, and often updated just before the auditor arrives. We remove a substantial barrier if it is easy to capture information in the field rather than spending evenings in the office. Reusing information captured for farm assurance records to provide insights for farm management aligns goals and makes adoption more likely.

Your thoughts?

Consumer expectations have been changing over the last decade. Our supply chains and production systems are evolving to meet those expectations. This will require a greater commitment from us all to transparency and integrity, making sure what we do lines up with what we claim.

Do you manage a supply programme, or participate as a farmer, grower or processor? We’re interested in your thoughts. Drop me a note in the comments, or contact me directly.