How FMCG Brands Can Grow as Regulators Clamp Down

We’re all guilty of consuming foods and drinks high in sugar. However, no-one should sugar-coat the reality that 2 in 3 adults and 1 in 3 of 10-11 year olds are now overweight or obese. In response, a 20% sugar tax is being proposed as well as a heavier clampdown on advertising food products high in fats, salt and sugar (HFSS) to children, by the Committee of Advertising Practice (CAP).

We, in the industry, don’t want to be part of fueling this epidemic. Instead, we want to communicate that the danger is in the dose, not the dose itself.

We recognise that political and consumer perceptions are profoundly changing towards HFFS foods - it’s less about everyday consumption and more about occasional treats. We don’t want to end up being regulated in the same ways as gambling, Wonga or tobacco categories. So what are the solutions? How can we grow whilst the regulations tighten their grip?

The easiest answer is to do the bare minimum and only react when pushed by regulatory bodies. However, this is a risky strategy and will only maintain short terms sales. Another answer is to invest in enhancing products with added nutritional benefits – or even developing new, healthier ones (like Tesco’s did when it introduced its healthy range).

However, we believe that there is a braver and more sustainable way for FMCG brands to drive long-term sales by leading the debate, instead of following it.

Brands who are truly leading in this way are reaping the benefits. Take Chipotle for example – they shifted to a more ethical brand philosophy to be all about ‘Food with Integrity’ and as a result have seen their share price treble in 5 years. Unilever’s brands think this way too - Ben & Jerry’s is fighting for climate justice, Flora Pro.Activ promotes health and PG Tips is now Rainforest Alliance certified, which has seen their share price increase by 50% in 5 years.

Leading in a world of tougher regulations is all about being ahead of consumer needs, not reacting begrudgingly. It’s about recognising that in the 21st century, HFSS foods are treats, not an everyday staple.

If you want to become a leading brand that can maintain brand growth, whilst helping waistlines decrease, then get in touch to find out more.

Simon Lamey is a Senior Planner at Southpaw