The new means of value addition in poultry is in the social dimension.
As a business-school student in the early-1970s, I was intrigued by Peter Drucker’s ideas on the then new demand that business make concern for society central to the conduct of the business itself. While Drucker noted that this expectation could be dangerously unrealistic, he said the penalty for neglecting social needs is very high. He went on to say that the quality of life of our society should be a tremendous business opportunity.
Social needs are imperative
That opportunity is perhaps more of a business imperative today, according to five supermarket and foodservice managers speaking at the 2012 Chicken Marketing Seminar (see “Food retailers tell chicken producers: Find consumer narrative about your product”). They described their customers as increasingly concerned about issues of sustainability, healthy lifestyles and the welfare of workers and animals in food production. In fact, their biggest request was for chicken marketers to develop a coherent narrative to help address these consumer demands.
There’s another part of the 1970s business curriculum that is as pertinent as ever. Abraham Maslow’s theory about the hierarchy of human needs said people (consumers) will turn their attention more to self-actualization needs (i.e., having a role in protecting the environment, ensuring social justice, etc.) as their most fundamental physical and security needs are more fully met. With U.S. consumers’ expenditures for food at a mere 9.8 percent of disposable income in 2011, consumers can psychologically and economically afford to focus less on purely economic product attributes and more on those of a warmer, fuzzier psychological nature.
Dimensions of value addition changing
One of the food retailers at the seminar, Vincent Ligas, director of procurement, Giant Eagle, described how the phenomenon has unfolded for chicken: “When I started in the grocery business in 1975, chicken came one way – in 70-pound ice-packed boxes. It was up to the retailer to produce whatever he could out of that box. I believe per capita consumption at that time was around 38 pounds. Today it is about 82 pounds. Innovation in products and packaging has enabled us to grow that consumption. It’s really amazing where we have come from and where we are headed.”
Poultry companies are adding social needs to their marketing strategies. What once was value-added poultry – mere sliced, diced, conveniently packaged poultry – is increasingly a commodity. The new means of value addition is in the social dimension.