Issues such as managing complexity of food quality through international quality assurance and food safety benchmarks were brought to focus on day two of Food Forum India (FFI) 2010, at the GlobalGAP conclave. Some of the eminent panelists included Dr G J Gyani, secretary general, QCI; Ram Kumar, VP Food and Agri Spencer’s Retail Ltd who stressed on the need to ‘act now’ and create a market for safe food items. They also pointed out the fact that such organic food stuff would come at a greater price which the educated consumer should be willing to pay. Kumar gave an example, “When we stated ‘tree ripened’ on the box of mangoes, they sold off faster and at a better price. The consumers are willing to pay value for money but the retailers need to convince them first. I believe food safety is an opportunity.”
Monitoring the debate, Dr Kristian Moeller, MD, GlobalGAP, Germany, claimed, “A label is an insurance for branding what the manufacturers and the retailers are putting together is safe. But it should not be misleading.”
This session led to another burning topic at the moment of private labels. Due to the economic slowdown, consumers have grown more value conscious than ever before. In this context, the role of private labels are getting redefined. In fact, the year 2009 that saw a vogue in the private label category. The PLMA (Private Label Manufacturers’ Association) Conclave on Private Labels was anchored by Brain Sharoff, president, PLMA.
At the very outset, he put forward his observation that the need for private labels is significantly on the rise across the world due to the marked change in the lifestyle and consumption patterns of the new age consumers.
Tom Stephens, former VP, Corporate Brands, Loblaws (Canada) pointed out that the role of the manufacturer and the role of the retailer should be guided by certain parameters as far as creating private labels is concerned. He shared, “The former needs to take care of the measurement matrix, supply chain, packaging, quality assurance while the latter can focus on architecture of the brand, marketing, in-store guidelines and so on. The strategies for building labels overall remain the same across the product segments irrespective of whether it is Apple, Nike or Coca Cola. Also innovation is not necessarily about being unique, rather being the ‘fast second’ is also a good enough option for brands.”
From the Indian perspective, Kumar shared some of the challenges that the private label sector is facing in the country. He said, “Consumers like to stick to certain brands. They are also ignorant about the existence of most private labels. So private labels should be positioned as typical differentiators. To give an instance, opting for completely different price points can be one in order to expand the consumer base in the market.”
Quoting a real life experience, Damodar Mall, group customer director, Future Group said, “Ours is a consumer driven company so more than the efficiency pressure, it is the pressure to create choices for consumers that we need to deal with. For instance 98 per cent of our consumers do not prefer cereals for breakfast. In order to overcome this challenge, currently we are trying to work out opportunities along with Kellogg’s.”
As a final word, Ashwin Ramaswamy, VP, Marketing, Jubilant Retail (Total) added that based on the evolving consumption patterns, retailers need to collaborate with manufacturers in order to add more value to the products for the consumers to opt for.
— Sayanti Banerjee