Tackling the big challenges in the food & drink industry
With the title ‘tackling the big challenges’ there was naturally going to be some tough themes discussed at the Food & Drink Federation Convention, which took place in London on Tuesday.
There are some big statistics that are a stark reminder of just how big a part the food & drink industry plays in our economy:
- There are currently 4 million people working the food & drink industry
- 400,000 people are working in the manufacturing sector
- Nearly half of all packaging in the UK comes from food & drink
- Two thirds of all lorries on the road are transporting on behalf of the food & drink industry
Panellists at the convention included representatives from Tesco, Lucozade Ribena Suntory, Mondelez, Coca Cola & the Department of Health.
Two of the biggest challenges from the day were how to secure the best outcome from Brexit (yes, that word again), and how to tackle the obesity crisis.
The food & drink sector will be the worst hit if the UK has to comply with new WTO tariffs. This will essentially mean 22-40% additional cost for businesses. So what are the biggest challenges and opportunities as we prepare to leave the EU?
- Workforce – the panel agreed that there is an urgent need to address talent shortage in the industry. There are 4 million people working in the UK food industry, and 1.3 million of those are from Eastern Europe. Research from Deloitte predicts that it’ll take between three and ten years to fulfil the labour shortage that Brexit will leave us with. Businesses need to look at a long-term plan around labour in order to minimise the damage to their workforce.
- Focus on innovation – 89% of businesses in the sector are involved in NPD and the UK is mid-table in R&D, behind Holland, Poland & America who are the leaders in R&D. 59% of businesses are collaborating with competitors around innovation – particularly around themes like health & wellbeing.
- Brands shouldn’t underestimate the power of ‘Made in Britain’ as a brand and the opportunity this provides businesses for exporting. Less than 1 in 5 businesses are exporting and in 2016 it accounted for £20 billion of the economy.
1 in 10 four-year olds enter primary school obese, and 2 in 10 are leaving obese. Globally, we’re spending 2 trillion dollars on the obesity crisis. Which is the same cost as all war.
There are lots of pieces of the puzzle to help meet the target of reducing sugar by 20% in 2020 and understandably this will require a great deal of collaboration between brands, retailers, government and marketeers.
From a retailer perspective, Tesco revealed that two thirds of their customers are telling them they want the retailer to ‘help them’ be healthy. Their criteria require all products to be affordable, easy to find and taste good. Crucially, new products onto the shelves must taste better and be healthier than the product they replace.
From a brand perspective, Lucozade Ribena Suntory has seen significant progress through the launch of their ‘Made to Move’ app, encouraging people to track their number of steps. In two months, they’ve received 53k downloads and clocked 5.7 billion steps. Their R&D Director credited its success by highlighting the point that bringing about behavioural change needs to be about getting people to do more, not telling them to do less.
So, how can brands take the consumer with them as they adapt products for health?
- Via the media, be engaging and transparent and don’t be scared of communicating to journalists
- Keep packaging simple and stick to traffic light nutritionals
- Use responsible, grown up messaging. Don’t overcomplicate it
- Think about your credibility. Are you in a defendable position?
- Move consumers in a direction that they feel like others are going in. The efficacy of this nudge method is seen in the power of influencer marketing – 60% of purchases are made from a recommendation online
- Ensure your communications are sustainable, they should strike the emotional/functional balance. A one off sensational headline will do little to bring about behavioural change if it’s not part of a bigger communications piece with your consumer
In light of these challenges and opportunities, the role of brand communications has never been more important. PR consultants need to ensure they’re having open & honest conversations with clients to help them navigate through these challenges, and support them in the less than certain times that lie ahead.