Educated Shoppers Demand More Transparency from Retailers

When it came to private-label products, retailers once only had to look at quality, cost and logistics. Now they need to know the answers to shopper questions that can range from "Is this extra virgin olive oil single varietal?" to "Is this palm oil endangering orangutans?""They want to know where the products are coming from and what's in the products," FreshDirect director of private brands Carrie Mesing said during an Aug. 16 panel discussion titled "The Push for Transparency" at Store Brands' Innovation & Collaboration Summit in Orlando, FL. "They want to dive deeper into what the ingredients are and what they mean to them."Considering how many questions shoppers might have, it can be hard to decide what information needs to go on a product's label."When you create a label, cleaner is better," Fresh Thyme Farmers Market director of private label Robin VanDenabeele said during the discussion. "You don't need to have 20 icons on a label. It gets confusing."The key is understanding the shopper's priorities. FreshDirect might not identify the roaster on a package of coffee, but they will say where the beans come from. Midwestern grocer Fresh Thyme views sourcing as important for honey and olive oil and identifies produce grown in the region. However, calling out a local source can be a problem for national chains because traveling shoppers might view one region's private label as better. When shoppers want to know about information that isn't on the package, the retailer needs to be able to provide an honest answer."It's important to build that trust and be sure the consumer feels like the retailer isn't telling them what they want to hear," Supervalu private brands manager Keith Winters said during the panel. "I think the longer the consumer waits for a question it builds mistrust. I would urge the vendor community to make sure that their response team is able to provide answers in a timely fashion."Sometimes the need to provide a satisfactory answer can force a retailer to rethink its products, like when FreshDirect discovered its frozen fruit blend was sourced from seven different countries. Retailer's making location-based or certified organic claims on their packaging also need to make sure their supply chain is sound so that the product always matches the label."It becomes critical to be very selective in the early stages of launching a product," Mesing says. "We spend a lot of time making sure that we're working with the right supplier. We view it more as a marriage contract than a transactional relationship."Unfortunately, even the most thorough vetting can't account for some problems. Supervalu had a supplier that was out of business for nearly two years after Hurricane Katrina, and FreshDirect needed to find someone else to make their ground nuts because the packages said they were made in Brooklyn, NY, but the producer moved to New Jersey."There's a need to always have backup plans," Winters says. "If you don't have some plan B suppliers who qualify, you're going to end up losing a lot of sales."Shoppers are also increasingly concerned not just with what they're consuming but if their food is packaged in a way that could be a health problem. Retailers will need to have the answers."In my mind, there's always been a bit of a barrier between the supplier and their packaging source," Winters says. "As time goes on, there's going to be bigger scrutiny and more questions."Beyond the packaging label, retailers can use their marketing department and mobile application to share information about their products. But they still need to make sure the messaging is clear."We have consumers that have very short attention spans, but they want to understand the minutiae," Mesing says. "Getting the message out in a concise way is a constant challenge for us."

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