Product differentiation is paramount in today’s competitive market. Consumers need something to lure them in, something to convince them to lay down the dollars and make the purchase. Exciting colors, innovative flavors and extra nutrition have proven to be good selling tools. Another incentive is a good story, one that makes the consumer feel positive about the purchase.
Millennials, in particular, appreciate uplifting stories. Often times, they are more interested in the sourcing of the ingredients in their foods than the nutrient content.
“More and more consumers are curious about where their food comes from,” said Alejandro Tovar, vice-president, marketing, Puratos Corp. “Along with a great-tasting product, they want to be able to trace the ingredients back to the earth, to the conditions in which they were grown and to the people who cultivated them.”
That’s what sustainable cocoa bean farming programs bring to any product using their chocolate.
The sustainable sourcing story is one appreciated by the majority of today’s consumers. According to the 2016 Food and Health Survey from the International Food Information Council Foundation, seven in 10 consumers think it is important that their food is produced in a sustainable way.
Data from the Natural Marketing Institute (NMI) showed that in 2015, more than one-fourth (27%) of consumers indicated they are willing to pay 20% more for products that are made in environmentally friendly and sustainable fashion. Further, almost two-thirds (61%) of them are positively influenced by a company that supports a cause in which they believe.
“Sustainability is not a trend; it is becoming a cultural shift,” said Steve French, managing partner at NMI. “Consumers are increasingly looking beyond the product and service and showing strong interest in companies’ sustainable initiatives. Almost all products and services going forward will need to consider consumer motivations regarding eco-friendliness.
“The return on investment of sustainability also has an economic component both in financial savings for the company and increased brand value, increased sales and reduced risk,” Mr. French continued. “Globalization will drive the need for more alignment of fair labor practices, ecosystem protection, sustainable farming, energy resourcefulness and many other practices.”
Cocoa beans, and the chocolate ingredients made from cocoa powder, are garnering publicity regarding investments by large end-users — namely bakers and confectioners — that assist with applying sustainable practices to secure quality raw materials and operate more efficiently. The goal is to help change the future of cocoa farmers by professionalizing and intensifying the agricultural practices that are the foundation of a well-run, high-yield and profitable cocoa farm. By enabling farmers to create sustainable businesses, industrial users of cocoa and chocolate believe they will ensure ample future supplies of cocoa while increasing incomes and securing livelihoods for tomorrow’s cocoa farmers.
This is necessary because the World Cocoa Foundation (WCF) predicted the global demand for chocolate will continue to grow as discretionary income rises in developing markets such as Brazil, China and India. According to Barry Parkin, chairman of WCF and chief sustainability and health and wellness officer, Mars Inc., McLean, VA, the cocoa value chain faces a number of challenges, and it is essential that action be taken.
“Farmers [in developing regions] often have limited knowledge of modern farming techniques and farm management skills as well as limited access to finance that would allow the purchase of input supplies and quality planting material,” he said. “Other challenges that impede productivity include aging trees that are past their peak cocoa pod production, decline in soil fertility and pests and disease that attack cocoa trees.”
Further, the price farmers receive for cocoa beans varies significantly across regions. This can be attributed to numerous factors, including different regulatory environments, access to market information, use of individual sales vs. leveraging the power of group buying, understanding of cocoa quality requirements and transportation costs.