1. Dr. David Hughes Emeritus Professor of Food Marketing Nuffield Contemporary Scholars Conference Te Papa Tongarewa, Wellington, NZ Monday, March 7 th, 2011 “Story Food” versus “Feeding the Family Food”: Different Strokes for Different Folks?

7. Top Global Grocery Profit Performers in 2009 Profit Margin % ROCE % Philip Morris Int.4047 Altria Group3638 BAT3224 AB InBev3114 GlaxoSmithKline3031 Coca-Cola2924 Diageo2821 Johnson & Johnson2625 SABMiller2514 Colgate -Palmolive2446 Reckitt Benckiser2419 Procter & Gamble2456 Pernod Ricard23 9 Reynolds American2116 PepsiCo1933 Profit Margin = EBIT after earnings from associates and other exceptional items ROCE = Return on Capital Employed Source: OC&C UK, 2010

8. Top Global Food Profit Performers, 2009 Profit Margin % ROCE % Group Danone16 12 General Mills16 19 Kellogg’s16 28 Campbell Soup16 35 Nestlé15 20 HJ Heinz15 24 Kraft Foods14 12 Unilever14 24 Cadbury13 15 ConAgra12 18 Profit Margin = EBIT after earnings from associates and other exceptional items ROCE = Return on Capital Employed Source: OC&C UK, 2010

10. Life Science Companies Ownership of Genetic Rights market power polarised nursery people growers/farmers distributors manufacturers etc. get squeezed! Major Global Food Retailers and Food Service Firms Ownership of Information on Shopping Behaviour Proprietary Technology and Demand Chain Squeeze

11. The Charge? Threatening Health & Well-Being of: -The Planet -The Planet - issues relating to sustainability, climate change, resource conservation, biodiversity, etc. -Consumers -Consumers – food safety, obesity -Food System Participants -Food System Participants – abusing farm animals, threatening smaller-scale farmers In the Dock: The Modern Global Food and Drink Industry

12. For the Prosecution

15. Hugh Fearnley-Whittingstall

18. % Obesity Levels in Selected Countries % Source: The Financial Times, September 9 th, 2010

19. 2010 Dietary Guidelines for Americans eat less, exercise more eat more: –plants i.e. fruit, vegetables – pulses, whole grains, nuts & cereals –seafood, low/no fat milk products eat moderately (government code for eat less) –lean meats, poultry and eggs eat significantly less –sugar, salt, solid fats, refined grains

20. Financial Times Report, October 2/3 rd, 2010 Nestlé To Invest $500 million in Health Science “The Swiss giant’s announcement marks an implicit step towards the recognition by Big Food that it bears responsibility for the unremitting worldwide rise in obesity – though food manufacturers are not yet ready to admit that their products are harmful, as the tobacco industry does...”

22. “Food Has Never Been Safer” US: Obama nominates food safety undersecretary 27 January 2010 | Source: just-food.com President Barack Obama has announced that he plans to nominate USDA veteran Elisabeth Hagen as his first undersecretary for food safety. US salmonella scare: farm inspections reveal manure, mice and maggots Calls for main egg producers to be better regulated after two firms at centre of scare revealed to have breached basic hygiene guardian.co.uk Tuesday 31 August 2010

24. “Consumers are blissfully ignorant of the existence of farm assurance and what it stands for” “Consumers are blissfully ignorant of the existence of farm assurance and what it stands for” UK Food Standards Agency Survey, 2002 so, traceability schemes and requirements are a waste of time and money, with most costs carried by the primary producer? consumers simply expect that the food industry has food safety “sorted”. They believe as a matter of course that we know exactly where all our ingredients come from. If they find out that we don’t, then, they are outraged.

25. Wal*Mart Announces Global Sustainable Agriculture Goals, October, 2010  Support Farmers & Their Communities  selling $1 billion in food from smaller-scale farmers  training 1 million farmers/workers in sustainable farming practices  increasing income of above by 10-15%  in USA, doubling sale of locally-sourced produce  Produce More Food with Fewer Resources + Less Waste  over next 5 years invest $1 billion in its global fresh supply chain  reduce food waste in stores worldwide by 10-15%  introduce Sustainable Produce Assessment for suppliers  Sustainably Source Key Agriculture Products  all Wal*Mart brand palm oil sustainably sourced by 2015  expand existing beef sourcing practice in Brazil with zero tolerance on deforestation

31. Nestlé S.A. to Receive 2011 World Environment Centre Gold Medal for International Corporate Achievement in Sustainable Development WEC's independent jury selects Nestlé S.A. as the 2011 recipient of the Gold Medal Award

38. Reasons for paying more for food and drink Thinking about food and drink that you are willing to pay more for, what are the most important reasons for doing so? Key Findings As many as 1 in 7 (14%) shoppers are willing to pay more for organic food 1 in 10 are willing to pay more for ethically produced goods and a similar number (9%) for goods that are better for the environment.

39. World Population: Who's Going Up and Who’s Going Down? 201020302050 - billion- World6.98.29.0 Africa1.01.52.0 Asia4.14.85.1 Europe0.7 LAC*0.60.70.8 North America0.30.40.5 Oceania0.04 0.05 *Latin America & Caribbean Source: UN (population scenario planning)

44. The Future of Food and Farming: Drivers of Change Global population increase from 7 billion in 2010, to 8 billion in 2030 and 9 billion by 2050. Dietary changes (increased global consumption of meat and dairy) will require substantially more resources than in the past. Future governance of global food system will have a big impact on supply and demand balance: –National food security policies –Production subsidies, trade restrictions –Growth of new food superpowers (e.g. BRIC) –Control of increasing areas of land for food production –Adequacy of current global international institutions Climate change Competition for key resources –Land (urban versus rural versus industrial) –Energy (e.g. green, price/availability of fossil fuel) –water Values and ethical stances of consumers – e.g. acceptance of new technology London, UK, 2011

45. The Future of Food and Farming: High Level Conclusions 1.More food from less. Contain demand for meat and dairy (code for reducing consumption in Developed countries. Minimise waste. Improve political and economic governance. 2.Climate change initiatives and achieving sustainability in global food system inextricably linked. 3.Revitalise moves to end hunger – reduce unfair subsidies, focus on rural development 4.All policy options open – code for embracing new technology. 5.Food self-sufficiency at national level rejected but maximise benefits of globalisation to ensure food supply. London, UK, 2011

46. Consumer Trends: Migration to the Poles “Feed the Family Food” Global High Tech Drudge/Chore Shop Consumer Shopper New and Improved Ready-to-Eat Fast Food Fuel Food Just Me Low Price Good For You All Year Intensive “Experience & Story Food” Local High Touch Leisure/Experience Shop Citizen Shopper Traditional Natural/Unprocessed Slow Food Story Food Friends/Family Premium Price Naughty but Nice Seasonal Extensive

47. “Feed the Family” or “Story” Food? Depends on Range of Factors Including: Income Urban or rural composition of population Family composition (e.g. children or not, help in the home... grandparents in China) Meal occasion Strength of national/regional food culture and food heritage

51. Impact of Campaign 500,000 more households bought Yeo Valley products in the 12 weeks to December 25 th, 2010, than in preceding period Outperformed total yoghurt market by 250% Viewed 2 million times on YouTube (YeoTube!) Sales boosted by £10 million – equivalent to 15% year-on-year – for a campaign investment of £3 million Advertisement aired 7 times during the X Factor (ITV1) and 25 ITV2 slots

54. We Want a Better World! Products which are: better for me –more convenient –better tasting –better price better for my well-being and body –feel good –look good –safer for my children better for the world and my locale –environment –Third World –my countryside better for Bambi/Flipper/Little Nemo/Babe/Bo Peep

55. CONTACT POINTS: e-mail profdavidhughes@aol.com telephone numbers office office +44(0)1600 715957 fax fax+44(0)1600 712544 mobile mobile+44(0)7798 558276 Check my latest podcast at www.profdavidhughes.comwww.profdavidhughes.com