food and agribusiness
Measuring mood
Similar behaviours
GMO consensus
More mouths
Individual attention
What's NewS Issue 9 October/November 1999 3 I
own culture and customers. But the core
corporate philosophy which has built a
worldwide empire is McDonald's so-called
QSCV concept. Consistent quality,
Is it a hot deal?
service, cleanliness and value is what
has made the brand great. 'It's easy to
say,' Hedges explained, 'but very hard
to do. Yet, value is a strategy that works
everywhere.'
Hedges explanation of adaptability raised
the question of why stick to one brand if
the product changes aecording to the mar-
ketplace. As another of the very few truly
global food players, this question was left
to Lars Olofsson of Nestlé France.
•Olofsson agreed that Nestlé had followed
I similar pattern of adjusting strong
branded products to meet differing con-
sumer preferences. The abstract notion
of 'mood' is also key in the multinational's
approach to its very broad and very deep
product ranges. But even though tastes
and flavours may differ, the strength
of brand continues to add value because
it enables Nestlé to be identified and
acknowledged by consumers in the
marketplace.
Hedges went on to explain that there was
a lot of misunderstanding about globaliza-
tion. While it certainly means increasing
competition, it also opens up huge oppor-
tunities, especially if you accept that there
«no uniformity in food habits or a global
andardization in food products. Yet
there is a similarity of consumer behav-
iour. But this similarity is not always in a
single market. Rather, there is increasing
market segmentation, depending more on,
for example, greying population, in-
creased life expectancy, diversification of
family models, growing participation of
women in the workforce, increasing
health awareness. These factors are not
necessarily limited to industrialized na-
tions, but are also applicable to high-in-
corne groups in low-income countries.
The general discussion focused on an issue
which is becoming increasingly important
for the whole industry: GMOs and other
biotech developments. Asked specifically
what their policy on GMOs is, both
Hedges and Olofsson responded that their
companies had one policy which they ad-
here to worldwide. However, there are
different sensibilities in various markets.
Olofsson said that Nestlé favoured the de-
velopment of new (bio)technologies, al-
though he added that many of the prod
ucts now being launched were anything
but 'new'. However, the bottom line for
Info exchange - debates were lively during the
Q&A sessions
both multinational corporates would be:
if the consumer doesn't want it, then we
won't sell it. To sum up, the consensus on
GMOs and other biotech products
appears to be that the industry will take
its lead from consumers.
Practical experience in the market was
now rounded out by statistical evidence
and predictions for future world food
consumption. Catherine Morton of
Promar International offered a detailed
overview of where food will be produced
and consumed in 2010 and what the im-
plications will be for the food industry.
Nuntbers such as 33% increase in mouths
to feed between 2000 and 2020 are
eomparatively well-known. Perhaps less
familiar is the 55% increase in affluent
consumers during the same period. As
noted above, these consumers will not all
be located in the same markets. Increasing
numbers of high-income consumers in low
and middle-income countries will be
responsible for a growing percentage of
the global food spend.
Another significant set of figures was
generated to answer whether the world's
growing population can be fed. Forecast-
ing that around 80% of output will be
generated by 20% of producers, Morton
classified farming level 1is subsistence;
level 2 is basic and semi-commercial;
level 3 is modern and commercial; level 4
is post-modern, super farms servicing lo-
cal, regional and international markets,
with no aid or other subsidized support
and driven by market forces. Aecording
to the forecast, the single greatest demand
for food will come from East Asia. By
2020, the anywhere/anytime consumption
pattern will be established in many mar
kets - a shift in consumer behaviours
which will have far-reaching effects for
point of sale and other retailers.
In level 4 markets, ereative flair will be
very important, as consumers will in
creasingly expect individual attention.
They will expect consumer comfort and
value for money.
