Lonely Red Telephone

Adapt and Prosper – or Not – in the Food Industry

Some parts of the food industry may be leaving us.  Rather than adapt, these companies want to keep selling the dietary equivalent of telephone booths. They imagine they can delay or avoid telling their customers how much sugar they’re pouring into their products. They imagine they can keep selling junk food into schools.

Ignore Your Customers, Lose Your Business

Right now, it looks like those companies are getting a sympathetic ear from the government. Trump’s FDA has signalled that it might bow to industry pressure. It might delay a new and improved nutrition facts label. The USDA is easing up on nutrition standards for schools

Hank Cardello is a former industry executive and senior fellow at the Hudson Institute. He told an industry panel at the recent Partnership for a Healthier America summit:

Sugar has become public health enemy number one now. We see what is happening at the World Health Organization, the dietary guidelines and changing criteria for sugar consumption. We have things like soda taxes out there for sugar sweetened beverages. They could spread to other food and beverage categories. It’s even in the work we have done with consumers. We find that now, along with calories, sugar is the number one concern that consumers keep telling us.

It is a hot button issue that the industry has to deal with.

Case Studies of Alienated Consumers

Coke put itself in a box by ignoring consumer concerns about sugar. By fighting consumer concerns about sugar, the brand has lost consumer trust. The brand is an asset on the balance sheet that’s not worth what it used to be. Goodwill disappears quickly when people can’t trust you.

McDonald’s lost ground when they ignored their junk food reputation. While they resisted, new competitors came along. Panera, Chipotle, Sweetgreen, and a host of other startups positioned their brands more in line with consumer desires.

McDonald’s and Coke might recover, but their brands are tarnished because they fought consumer preferences. Squandered trust is doubly hard to regain. Big brands are based on nothing but consumer trust.

Click here for more from Food Navigator USA.

Lonely Red Telephone, photograph © Matteo Castagnotto / flickr

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May 23, 2017

One Response to “Adapt and Prosper – or Not – in the Food Industry”

  1. May 23, 2017 at 11:32 am, David Brown said:

    Ah yes. Sugar is the bad guy now. Why didn’t they figure that out 40 years ago? Because they were focused on saturated fat and cholesterol. Meanwhile, the healthy fats debate rages on with the Harvard School of Public Health insisting that saturated fats are just as bad as sugar. https://www.hsph.harvard.edu/nutritionsource/2016/12/19/saturated-fat-regardless-of-type-found-linked-with-increased-heart-disease-risk/

    Elsewhere, however, a different narrative is taking shape. https://www.credit-suisse.com/us/en/articles/articles/news-and-expertise/2015/09/en/fat-the-new-health-paradigm.html

    And scientists from the University of British Columbia are developing a narrative that may explain how the global obesity epidemic came about. https://news.ok.ubc.ca/2017/04/12/ubc-researchers-connect-common-fats-to-a-lazy-lifestyle-and-diabetes/