Food Transparency Demands Should Make Brands, Retailers Think Twice How They Produce and Source Products

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Consumers are demanding more information on the food products they buy, and many do not currently trust the way brands are currently providing product information. Those were some of the main findings from the new Food Revolution Study from Label Insight , a software company specializing in collecting and analyzing food label data. The survey offers some insight into how consumers purchase food and could encourage food retailers to rethink how they source food products.

Label Insight surveyed more than 1,500 consumers to get an idea of how they chose to buy food products and what product information they expect from brands. According to the survey, 67% of consumers expect brands to provide complete and accurate product information and believe it is the brand or manufacturer’s responsibility to offer this data. However, 75% of consumers also say they do not trust the accuracy of the product information brands are currently providing.

It is becoming increasingly clear consumers want more food product information to be available, according to Patrick Moorhead, chief marketing officer for Label Insight, and the survey aimed to identify some main motivators behind those product transparency demands.

“We wanted to conduct research to quantify the consumer view of why it is important and why it matters,” he said.

Consumer Insight

The survey identified more than half of consumers shop for food according to a specific diet they follow, which could be another reason why product information is so important. Additionally, nearly all consumers surveyed (94%) said it’s important the brands they buy from are transparent about how their products are made and what ingredients are in them. Having access to more product information is a driver of purchasing decisions, too. Seventy-one percent of consumers said they consider the full list of ingredients before deciding to buy a food product.

Perhaps one of the most shocking findings from the survey, according to Moorhead, was that nearly 40% of consumers said they would switch brands if the brand offered the product information they desired. It’s a finding that should make food retailers and manufacturers think about how or if they currently provide consumers with the product information they demand. The survey shows the more information a brand provides, the more likely they are to purchase that brand’s product.

“The stakes are very real,” Moorhead said.

Manufacturers: The Source of Product Information

Food retailers are requiring more information from suppliers and food manufacturers these days, as well, to be able to respond to the growing demands of consumers. While Moorhead said Label Insight survey’s finding could impact how retailers decide to source from food companies, it is also becoming clear that manufacturers are the main source and control point for all information on their products. Consumers are largely holding manufacturers accountable for providing this information, too. As stated above, the majority (67%) of consumers believe the manufacturer is responsible for providing information about the food product, while only 5% think it is the retailer’s responsibility. Another 5% identifies third parties as the responsible source of this information and 21% said it was the government’s responsibility to mandate product labels, according to the report.

Transparency Creates Opportunity for Food Industry

The federal government recently made changes to its requirements for nutrition labels on food products. According to the U.S. Food and Drug Administration, they are changes that will “make it easier for consumers to make better informed food choices.” And, while not mandated by the government, the SmartLabel initiative, created by manufacturers and retailers and led by the Grocery Manufacturers Association, calls on companies to provide more detailed information on the foods, beverage and consumer products they make.

The SmartLabel initiative also presents a neat opportunity for food companies, especially from a marketing point of view, Moorhead said. Being able to promote a product is made with domestically sourced ingredients, or cage-free eggs, for example, could create a competitive advantage in the market. This information could not only attract new customers but keep them coming back to buy more, building trust in the brand and long-term loyalty.

For Label Insight, it showing food companies how an investment in product transparency does produce financial benefits and ROI, Moorhead said.

“The return is customer loyalty, which equals long-term value, which equals dollars and sense at the bottom line,” he said.

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