The International Egg Commission (IEC) met in London at the end of March.
In his opening address to attendees, chairman Frank Pace pointed out that the industry had achieved a lot over the last 12 months, but that one of the challenges for the future would be to raise awareness of the importance of farming practices in hen welfare.
Animal welfare and approaches to farming resulted in widely diverging views during the event, but as Mr Pace pointed out:
“It’s not the method, it’s the way, whether you are a caring farmer or not.”
Greater reach
So what has the sector achieved over the last year? For one, the IEC has entered into agreements with the World Organisation for Animal Health (OIE) and managed to overturn unworkable legislation on avian influenza as it related to egg products. An animal health working group has also been established.
Also on the international arena, the organization has been accepted as the voice of the egg industry by the Food Business Forum CIES, which includes the world’s top 800 grocery retailers.
The Commission is working at various levels, for example developing broader communications along with conferences. Its approach to consumer relations is moving ahead and visits to its Web site are significantly higher.
Tracking has revealed that most visitors to the site are looking at at least three points. The Commission’s e-newsletters are now going to 392 non-members and 581 members.
However, the organization is not resting on its laurels. Strategic advisor Frank Kaye explained that the views of the membership had been sought via a questionnaire and that a strategy day had been held. A lot of detail about how the IEC should move forward has been gathered, allowing the Commission to frame just what its future will be about and exactly what role it should play.
Customer focus
Amongst speakers at the two day event was Dean McKenna, divisional supply chain lead at McDonald's Europe.
He explained that, in 1998, McDonald's in the UK made the switch to free range, and was the first market in Europe to do so. This change was made partly in response to consumer demand but partly in anticipation. Following the switch to free range eggs, the group has also introduced free eggs into those products that contain eggs, for example sauces.
And McDonald's has additional free range initiatives, for example tree planting on farms to offer the shadows that chickens are thought to like and to encourage them to roam further.
This change has not gone unnoticed. In 2006, the chain was awarded the Compassion in World Farming Good Egg Award and, at the end of 2008 won the UK’s Royal Society for the Prevention of Cruelty to Animals (RSPCA) good business award for the second time.
Mr McKenna reminded delegates that, despite the downturn in the economy, now was not the time to compromise on values.
Understanding consumer values and wants is key in the current market. Ken Dowling, of marketing communications company Grey Worldwide, pointed out that today’s consumer is more knowledgeable than ever before and that, with the digital age putting consumers in charge, we have seen the rise of the “pro-sumer”.
We are certainly experiencing a market of changing habits. Consumer confidence is low, while anxiety is high, and there is both trading up and down. There is a growing emotional value in food, with consumers “hiving”, or retreating into the home. This has been accelerated by the downturn, with more people not only eating at home, but also preparing food at home. Alongside this trend, there has been growing demand for private label goods.
While people may be going back to basics, there is a dreadful lack of cooking skills, Mr Dowling pointed out. Those brands that are offering help are gaining interest.
Real welfare?
G Gregory, of United Egg Producers USA, argued that the industry wanted guidelines based on science, guidelines that were driven by the industry itself. “We can do it better than the legislators, we understand the market,” he stated.
He continued that, in the USA, animal rights was not about animal welfare, but rather social change, and that the long term aim of animal rights’ groups was to eliminate animal agriculture and to create a vegetarian society.
The Humane Society of the United States (HSUS) and People for the Ethical Treatment of Animals (PETA) were the main drivers, he continued, with the HSUS being the most feared organization in the US.
“The HSUS must be feared,” he said, “they are coming after everybody.”
Market forces
Richard Lewis, CIES International Food Business Forum analyst, noted that 7.6% of US citizens were out of work and that in the UK there would be a 33% increase in the purchasing of own brands. But he warned that consumers were not always quite as knowledgeable of the most economical place to shop as might be thought. Studies had found, he continued, that it could be 61% more expensive to buy in the discount supermarkets than buying the big four’s discount brands.
The CIES has already carried out its Top of Mind Survey this year, which gave the following results: 56% of respondents said that the economy and consumer demand were top of mind, while 33.6% said that food safety was the major issue. 33.1% said that corporate responsibility was top of mind while for the remainder it was the competitive landscape.
Marketeers must appeal to all groups in the current climate. While some consumers are suffering a loss of income, other are financially anxious, and even those that are immune to the downturn have become sensitive to it. If producers only cater to the first group of consumers, however all consumers will become conditioned to expect low prices.
In a period of cutbacks it was encouraging to hear news of investment in the industry. Dr Hongwei Xin, professor, director, Iowa State University, detailed that against a background of a continuing decline in government funding for universities in the USA, and a shortage of scientists in the industry, the Egg Industry Center had been established in 2008.
The centre will support the industry nationally and internationally and, Professor Xin explained that the centre would work on projects that supported the industry as a whole and that work should complement rather than duplicate initiatives elsewhere.
The next IEC conference will take place in Vancouver in September.
