The Carrageenan Case: How consumer demand impacts business practices
Prior to the Internet and social media, the term “consumer demand” was only a measure of desire for a product, based on its availability. Today, that term possesses far more meaning; consumers are quite literally demanding that products be the way they want. And a business’ ability to meet these consumer demands can make or break a company in today’s highly competitive market.
With blogs, social and digital media campaigns, “watchdog” organizations, online reviews, viral news, and more, it’s easier than ever for customers to express their opinions about a product, and hold a company accountable for its actions. As such, listening to customers is becoming an increasingly important business practice. The case of the food additive carrageenan demonstrates how several large food producers are applying this principle in response to consumer demand.
The Carrageenan Case
As they say, the proof is in the pudding…or in this case, it’s in the seaweed. Carrageenan is extracted from red seaweed and used commonly as a food additive to thicken and emulsify; it has no nutritional value. If you’ve eaten ice cream, yogurt, liquid dairy, cottage cheese, or dairy alternatives (soy milk, almond milk, etc.) at any point since the 1930s, chances are pretty good that you’ve consumed some carrageenan.
Although the degraded form of carrageenan has been found to cause cancer in animals, the food additive comes from the undegraded form. The U.S. Food and Drug Administration (FDA) has deemed undegraded carrageenan safe to use in food as recently as April 2014, and the National Organic Standards Board (NOSB) permits its use in organic products. But despite these safety assertions from the regulating agencies, consumers remain skeptical that the undegraded form of carrageenan is in fact safe to consume…specifically, many are concerned that the food additive also causes digestive inflammation and cancer, as some studies strongly suggest.
Respond to Consumer Demand. Retain Customers. It’s that simple?
As consumers voiced their concerns (loudly and repeatedly) about carrageenan, major food producers began changing their tune…and recipes. Take Stonyfield, for example. In 2012, the yogurt company engaged a scientist to conduct an independent review of undegraded carrageenan’s possible health impacts. The company publicly stated: “Based on this independent review, along with the Board’s [NOSB] recommendation to continue to allow it in organic production, we feel that carrageenan continues to be a safe ingredient to use.” Now let’s jump ahead to June 2015, when Stonyfield announced a new carrageenan-free recipe for their YoKids Squeezers: “We’ve been hearing an increasing number of questions and concerns about this ingredient and that some of our fans would prefer we take carrageenan out of our products completely. So we committed ourselves to developing new recipes that do just that.” So Delicious Dairy Free and WhiteWave Foods (the company that owns the Silk and Horizon Organic brands, among others) are other companies that recently made the decision to remove carrageenan from their products, based on consumer demand.
As So Delicious states, “it isn’t easy work to recreate recipes,” yet companies are going to the trouble to do so. In the statements issued by the above-mentioned brands, there is no mention of “due to overwhelming scientific evidence” or “because new studies show” (in fact, all three companies state their continued trust in the regulating agencies and reiterate their belief that the ingredient is safe). Instead, they all attribute their changed recipes to responding to consumer demand. With many food advocates disseminating their concerns to large audiences (e.g., “Food Babe” alone has 92K Twitter followers and over a million Facebook followers), it is very easy for consumers in today’s digital age to learn about what they’re buying and what other products might better fit their desires. In fact, this June 2015 study conducted by Daymon Worldwide demonstrates how consumers’ fears about specific ingredients affect their shopping behaviors and purchase decisions. Thus, companies that are not listening could be losing customers to their competitors.
Even if your business is not in the organic dairy sector or operates on a much smaller scale than these businesses, there are lessons to be learned from The Carrageenan Case that apply to all. Do you truly listen to your customers? What is your business’s capacity to adapt and respond to customer concerns? As consumer trends move toward more sustainable and healthy products, can your business expand and produce high impact offerings? These are the questions all businesses need to be asking themselves in today’s market…because there’s no way to know what product or ingredient will be the next carrageenan.
Editor’s Note: If you want a deeper look at the debate over carrageenan’s safety, you can check out what Dr. Andrew Weil, Chris Kresser, The Cornucopia Institute, The Center for Food Safety, and “Food Babe” have to say on the subject.