Big issues and even bigger stakes: the importance of transparency and good communication

13-Jul-2015 - Last updated on 12-Jun-2024 at 11:10 GMT

From GM to junk food, many food industry issues go beyond the realm of the industry itself – they shape, and are shaped by, our world view says one expert at IFT. So what approach should companies take when dealing with such big issues that both impassion and divide consumers?

The food we eat is more than just a means of providing sustenance to our bodies - it is a reflection of our cultural and socio-economic values, said professor at the University of California in Davis Charlotte Biltekoff. And this is why so many of the topics at the heart of the food industry are so inherently divisive, she said.

Striking a balance

At the same time these big issues are being debated in an entirely different arena to twenty years ago, according to vice president of Vision Critical consultancy Alka Tandan. A shift in the balance of power between companies and consumers has taken place, she said.

Consumers have always had a voice but now, thanks to social media, they can make that voice heard and make it resonate internationally.

So if companies are to survive amidst such diverging voices, they need to really listen to what consumers are saying and engage in real dialogue with them, she said.

And the stakes are high. For United Airlines, the cost of not engaging in open, transparent dialogue with a single irrate consumer turned out to be $180 million.

Tandan showed a video which demonstrated the airline company’s fatal error and gave an example of a company whose quest for transparency was successful:

But which consumer should you listen to?

But even companies who listen to their consumers face a dilemma – which consumer to listen to? Tandan gave another example of how this could be difficult.

Market studies have shown that 40% of consumers want to see the word ‘natural’ on their food packaging, while 30% want the word ‘organic’. So which should the company go for?

‘Natural’ may seem to be the obvious choice because more people said they wanted it, but the term is nebulous and doesn’t have any real content behind it, she said. ‘Organic’ is more concrete but the statistics seemed to suggest that it had less pulling power.

There are so many different opinions to listen to it can become confusing for companies – and the myriad of diverging voices is not just from consumers, as Nestlé recently discovered with the Maggi lead scandal.

When Indian health authorities conducted tests and found the lead content in Maggi noodles to be too high, Nestle reacted by swiftly removing the product from Indian shelves at a cost of $50 m – “to their credit’, said Tandan.

But then food safety authorities in other countries – Vietnam, Australia, the UK and Canada among others – conducted their own tests and declared the product to be safe.

So which authority should Nestlé listen to?

Once again the answer lay in open communication: “It comes back to having conversations to understand what is important to your customer base.

“If you are in constant dialogue [with consumers] and share back to them what you are doing you can build credibility and trust that takes you past these momentary issues that may come up.”

Because even if not every customer agrees with the actions you take, they will probably appreciate the openness, said Tandan.