Marketing and Strategy – Organic Food Essay
One of the significant causes in changing consumer demands that current marketers face are the increasing environmental problems that people are becoming aware of. Consumers are interested in just how goods happen to be produced, particularly in the food market where there is the increasing issue of labour exploitation and hereditary modification. This has gained a lot of momentum in recent years with the growth of the Organic sector and? Reasonable Trade’ items.
In 2004, the retail market for organic products in the UK was worth approximately? 1 . 213 billion, and 11% enhance on the year 2003, (Soil Association’s Organic Marketplace Report, 2005). This notion is copied by Mintel, “In almost all of the consumer analysis we carry out around a quarter of consumers are concerned about green issues, seek out reasonable trade items or healthy and balanced ranges of foods. That is a substantial percentage of the customer base of virtually any food dealer and so may not be ignored” (UK retail briefing-Household goods target, 2006). Genetically Modified & Organic Foodstuff A genetically modified (GM) food can be described as food product which has been developed by having specific family genes inserted with it to gain an appealing quality.
The first GMC food to hit the cabinets were GM tomatoes which in turn appeared in 1996 in British supermarkets, however , it had been not right up until 1999 the public frighten hit. Within a recent review, one third of men and women said they would never purchase any meals that had been genetically modified. This figure is up by 4 percent in three years, a large significant amount (attitudes toward ethical foods UK- Mintel, 2006).
This provides an opportunity to get marketers operating in the food sector, for example a company could encourage itself while environmentally conscious by professing they sell only non-GM develop. This would provide them with the advantage of comforting worried consumers whilst rendering them with the upper hand against organizations who carry out sell GMC foods. One more benefit is that there are a large proportion of middle and upper class customers who are usually aware about the problems related to innate modification and organic meals. This maybe opens for you to price items at the more costly end with the market, because they are likely to pay much more if the meals meets their particular expectations.
Organic food products are becoming increasingly popular as a result of ever-increasing understanding of health issues, multimedia campaigns through the large supermarket chains and endorsements from celebrity chefs. To meet these kinds of changes in client needs, all of the leading superstore chains include introduced organic ranges within their stores. There is also the fear in the UK for the future with the? fast food game titles console’ kids, (P.
Custom, http://www. learnmarketing. net/environment. htm) which provides an immediate market opportunity for healthier food products. If a firm specialises simply in selling organic produce they would be able to advantage of these types of opportunities. A recently available example of this can be innocent beverages, selling the innocent label of? smoothies’.
They began which has a simple investment of? 500, selling newly made smoothies at a music event and now order a thirty percent slice of the market using a retail worth of about? 50m, (Market Researchers AC Nielsen, 2003). Problems is that these organisations need to aim their products at the proper market.
Typically it has been customers in the middle and upper classes who have been ordering organic meals, however there is “an pushing widening in the appeal? with over fifty percent those in lower income organizations now stating they buy some organic and natural products” (Soil Association Press Release, 2005). This means that there might be an opportunity in trying to give cheaper organic food marketed on the lower end in the income scale. Even if the price is similar to additional organic merchandise, it could be promoted to show the direct advantages of the food to help consumers rationalize spending additional money for organic food.?
Fair Trade’ Products Good trade is a relatively new, structured social movement that encourages equal specifications for international labour, environmentalism and interpersonal policy in the areas associated with the production of? Fair Trade’ goods. This is certainly another rapidly growing section of the foodstuff market that is certainly providing a good opportunity for marketers, reporting an enormous increase of around twenty percent a year (FINE, 2005) and now standing for a market worth of?
660 million. The movement has also benefited coming from increasing multimedia interest, which means any underhanded behaviour or perhaps employee fermage could lead to an enormous amount of bad publicity. It is obvious that to advertise a good manufacturer image in today’s market, an company should look to be aware to fair control issues.
The possible chance here is based on the current variety of fair control products which have been on the market. At the moment the main items in fair trade varies are goods such as fruit, nut products, chocolate and coffee; this means there can be a demand intended for products in other categories, like meat goods or even good trade beverages. This larger range of good trade goods could offer a business a unique selling point, as well as providing associated with a strong moral stance.
Maybe there would even be a probability to use the pressure groups or non profit organizations that are affiliated with fair trade to the organisation’s advantage. Marketers could combine the providing of good trade merchandise with possessing events to raise awareness of unfair trade problems. If they could gain the backing of non profit organizations such as Oxfam or control networks like the European Fair Trade Connection, there would be loots of for you to raise their particular brand consciousness, thus elevating sales. Local Produce Eco aware individuals are increasingly favouring local create.
Over 100 years ago the majority of the food all of us ate originate from within twenty miles of our homes but now we would find it difficult to find a several locally developed goods in our supermarkets (Inside Out? East, January 2003). This may certainly not seem while an obvious environmental issue but the problem is placed within the travel that must happen to move food products around the UK and the universe. A massive 25% of vans on the UK roads happen to be carrying foods; this means that almost as much green house gas is definitely caused by shifting food than by almost all power channels in the UK (Inside Out?
East, January 2003). Importing goods from abroad also triggers pollution issues, a large proportion of lamb sold in great britain comes from New Zealand as well as the same is valid for taters from His home country of israel. Perhaps there exists an opportunity for UK organisations to resource their food products locally. An enterprise doing this would be able to promote all their policies in pollution reduction whilst also promoting an investment in regional farmers. This will help greatly in obtaining local business but it is probably not possible to source a large number of food products in certain areas, however , any make an effort to reduce the massive pollution due to transport might offer a good selling point.
It is crucial to note for firms seeking to take advantage of the increasing consumer recognition that there might be problems. Retailers focusing on simply selling Organic, Fair control and local develop are generally small in size and very specialist. If they happen to be seen to have a very powerful idea it truly is highly very likely that the major supermarket chains will try and imitate this with their increased resources. This could be very serious competition and should be regarded as if a organization is looking at in only selling merchandise to the environmentally aware customers.
There is also the opportunity of specific barriers to enter into these specialist market segments; one of these is the established competition. Organisations like the Co-op have already been long-term followers of fair trade. Another likely is actually the elevated scrutiny a business will face when? announcing’ themselves to be ecologically aware.
If a business reports to be eco aware and it is then viewed to be undertaking damage, it would most likely cause significant economical damage. How could Marketing help in ethical terms? The most obvious way in which marketers can assist in honest terms through increasing customer awareness in the issues that happen to be troubling the food market today. A way to do that would be to create simple advertising campaigns where benefits of organic food or local create are displayed clearly to the consumer.
An example of this could be Sainsbury’s TV advertising campaign fronted by Jamie Oliver showing the re-launched? Flavor the Difference’ range. They have removed every artificial flavours or colours, stopped applying hydrogenated fat and only applying free-range eggs and UK-sourced meat, (The Guardian, August 2006) combined with the links Jamie Oliver must health recognition and features lead to a very effective campaign. One other way that marketers can help customers is to make certain that the packaging of any product uses environmental recognition and ethical issues. First of all the packaging of a product ought to be recyclable and reduced to a minimum, in fact there should be? reminder to recycle’ on all products that have recyclable packaging.
Second of all the labelling of products has to display the relevant health and environmental information obviously. Tesco have implemented the traffic light system to demonstrate the features of a merchandise at a simple glance. Customers can see by the colour from the light whether or not the product is regarded as healthy, which can be determined by body fat, calorie and salt content. Likewise it might be possible to put small sections of information on fair trade goods to show the rewards to the producers that reasonable trade has.
If there were a greater expertise by the common consumer it may lead fair trade foods to become common, opposed to the current niche they are filling, offering social benefits like minimizing the global lower income gap. Also, it is important for the labelling and packaging on the product never to be deceptive. If a foodstuff clearly satisfies organic meals standards it should be branded as organic and natural; likewise anything that is not produced nearby or is usually not organic should be classed correctly. Recently there have been reviews of Grocery stores putting pressure on organic and natural food watchdogs to lower specifications so they can fully exploit the industry, (The Guardian, March 2006).
It is often stated “there are lots of weaknesses in the restrictions and in practice these are getting heavily exploited” and that “Organics is increasingly becoming industrialised as well as the consumer will one day get up and see this stuff is not really what they think it is”, (L. Woodward, former head of The Soil Association). It is clear that marketers need to stay good and genuine to ensure that the supermarkets are not able to lobby jointly and reduce the criteria.
Perhaps a stance could possibly be taken by one of many supermarket stores to actually support the stricter guidelines, even if it might close the exploitative opportunities. A possible way to encourage persons further to buy organic or perhaps fair transact products would be to offer offers involved with the purchase of these goods. Grocery stores could conveniently offer consumers a larger number of store incentive points when the sale occurs, or even try to focus BOGOF deals and price savings to these merchandise ranges. I recommend that special offers where the client gets 1 fair operate product for half value when two organic products are ordered should be applied.
Linking the product ranges might help encapsulate a number of the organic aware consumers in to purchasing fair trade items or in your area sourced products and vice versa. A new principle that has been introduced to counter a defieicency of transportation polluting of the environment is meals miles; the basis of this revolves around a ingredients label on foods stating what lengths the product needed to be transported to achieve the supermarket. Marketers would use this function to show customers that goods are adding to heavier to pollution.
It would also assist in educating consumers into viewing which items should be acquired at in season times to minimise transfer. If you were looking to purchase strawberries in the winter they would possess travelled an extended distance to succeed in the UK, possibly highlighting this fact will teach several consumers to have more? seasonally’. The new even more socially mindful consumer is usually presenting big opportunities to the main food suppliers due to the growing markets in organic food.
These chances can conflict with what will be considered ethically considerable, particularly the issue with organic and natural food attractive to the higher end of the industry thus ultimately causing the possibility of keeping prices substantial. Of course it is far better for environment and customers if the prices are kept lower in organic foodstuff so everyone is able to eat much healthier. Perhaps the supermarkets should consider lowering their margins on organic and natural food and making it again on more price inelastic goods including alcohol or cigarettes.
It truly is clear however that organisations should be careful in deciding which opportunities to take advantage of because their actions can have unfavorable repercussions just like consumer cynicism, leading to customer cynicism. Though if internet marketers are able to promote these moral issues and increase public awareness whilst still maintaining profit expansion, the potential benefits for everyone are great. Bibliography? Dirt Association (2005) “Organic Industry Report 2005”?
Soil Affiliation (2005) “Soil Association Press Release”? GREAT (2005) “Fair Trade in Europe 2005: Facts and Figures in Fair Transact in 25 European countries”? Mintel (2006) “UK retail briefing – Household goods focus?
Mintel (2006) “Attitudes toward honest foods in the UK”? P. Tailor, Learnmarketing. net/environment. htm? AC Nielsen (2003) Researching the market? BBC. co. uk/insideout/east/series2/local_produce_organic_healthy_eating. shtml? Laville.
H & Vidal. J (2006) “Supermarkets offender over organic and natural foods”, The Guardian, October 5th.