Trust Truth and Transparency

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Honest Tea Honest Tea was founded in 1998 with a mission to bring to market a bottled-tea beverage that was less sweet than its competitors and used organic ingredients, all while adhering to fair trade practices of improved trading conditions, sustainability, and social and environmental standards. By 2006, Honest Tea had revenue of $13.5 million and was selling approximately 1.5 million cases of product per year. In 2008, Coca-Cola purchased a 40 percent stake in the company for $43 million. Coca-Cola purchased the remainder of the company in 2011 for an undisclosed amount. It is estimated that Honest Tea’s 2015 sales were $160 million. Freedom Foods Freedom Foods is an Australian food company that for more than 30 years has been producing nutritious and allergen-free food. Today, its better-for-you product line includes cereals, bars, snacks, spreads and beverages. In 2009, Freedom Foods solidified its position as a leader in its region in the GMO- and allergen-free segment by constructing a 25,000-square foot production facility in New South Wales, Australia that is completely free of wheat, barley, triticale, peanuts, soy, dairy, eggs and sesame seeds. Additionally, most of the company’s product ingredients are carefully sourced from family farmers in the Murrumbidgee River basin area. Freedom Foods’ 2016 revenues reached $127 million USD, 81 percent greater than the company’s total sales of $70 million USD in 2015. The company’s impressive growth and presence in Australia demonstrate that the demand for better-for-you foods is increasing globally. Today, over 80 countries around the world have organic regulations and the US accounts for only five percent of the world’s organic acreage. 6 | THE RISE OF A NEW FOOD INDUSTRY MANDATE: TRUST, TRUTH AND TRANSPARENCY
Truth behind the Talk Establishing and maintaining consumer trust is a never-ending priority, and requirement, for brands that are leading in the healthy-food sector. However, there are hot-button concerns that provide fertile ground for discussion and debate, from the most heated and divisive to the most rational and inclusive, by the media and general public. These often spirited exchanges can confuse consumers and, in some cases, undermine their confidence in the sector. The following is a discussion of four top consumer concerns and the influence they are having on today’s healthy-food sector. “Natural” Claims The healthy-food sector includes unregulated “natural” products. However, “natural” has yet to be defined by the US Food and Drug Administration (FDA) or any other authoritative organization, leading to research-supported consumer uncertainty and skepticism over product claims. Consumer Reports’ National Research Center discovered that 62 percent of consumers already buy natural products and the group would also be willing to pay more for these items if they understood and trusted the natural claims. A clear majority of this group – 87 percent – agreed they would pay a higher price if the natural label met their expectations. In comparison, the US Department of Agriculture (USDA) has created strict certification requirements and a national, uniform qualification standard for organic products, though organic products have historically generated a less positive consumer response than natural products. Despite general skepticism, there has been tremendous growth in the organic market, with sales of organic products surpassing $40 billion annually. Additionally, a 2016 Organic Trade Association survey reveals that 47 percent of US families are “very familiar” with the USDA organic logo, up from 27 percent in 2010. “Non-GMO is the fastest-growing food-label claim, with 15.7 percent of new products introduced in 2015 making “Non-GMO” or “GMO-free” claims – an increase from 10.7 percent in 2014 and 2.8 percent in 2012. Similar strong growth is seen in organic products, with 13.5 percent of new products making organic claims in 2015, up from 10.7 percent in 2014.” – MINTEL’S GLOBAL NEW PRODUCT DATABASE (GNPD) THE RISE OF A NEW FOOD INDUSTRY MANDATE: TRUST, TRUTH AND TRANSPARENCY | 7
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Page 6 and 7: Platform of Trust Trust is food com
Page 10 and 11: Truth in Labeling In the midst of a
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Page 14 and 15: Hormel’s Acquisition of Justin’
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