How Erewhon Has Become the Stamp of Approval for CPG Startups
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This article originally appeared in Presence Marketing’s February 2022 Industry Newsletter
By Steve Hoffman
Founded in 1966 in Boston, MA by Michio and Aveline Kushi, Japanese immigrants and pioneers of the macrobiotic movement, Erewhon Market eventually made its way out west and has been expanding in the Los Angeles area under its current owners, husband and wife team Tony and Josephine Antoci, who took over the business in 2011.
Since then, the retailer has expanded to seven stores. It received investment capital in 2019 from New York-based Stripes Group, and the stores have become known as the trendy place to shop for natural and organic products, and to hang out. A fanbase of young consumers, health and wellness influencers and Hollywood celebrities from Gwyneth Paltrow to members of the Kardashian-Jenner family have been seen shopping at Erewhon.
As a result of its growing popularity and accessibility, young food and beverage brands are flocking to Erewhon in hopes of being discovered. “It’s a good-sized grocery chain to supply without being overwhelmed, Mayssa Chehata, founder and CEO of Behave candy told Modern Retail.
Jennifer Ross, co-founder of beverage brand Swoon told Modern Retailer that Erewhon was the company’s “retail north star.” As a smaller CPG brand, Ross said it can be hard to work with big retailers like Whole Foods and Sprouts from the very beginning because of capacity constraints. “With Erewhon, you can literally FedEx them small batches of inventory,” she said.
DTC and CPG brand consultant Kendall Dickieson told Modern Retailer that for emerging companies, it can take years to get on Erewhon’s shelves. But it can be worth it, she noted. “And if it’s your first location, it usually paves the way for the rest of your wholesale trajectory,” she said. “As someone who’s always looking for new trends, Erewhon is the holy land,” Dickieson added. “If you’re on the shelf, it means you’ve been vetted by the top of the top when it comes to health grocers.”
Erewhon’s status as a health food discovery hub has been a source of free promo for brands among not only consumers and influencers, but other retail buyers. “It’s got a trickle-down effect among other buyers and brand influencers,” said Chehata of Behave. She said the brand saw a big uptick in organic customer and influencer posts during its first week on Erewhon’s shelves. In addition, Chehata credited the brand’s presence in Erewhon in securing other partnerships. “I can’t say we got further interest solely because of Erewhon,” she told Modern Retailer. “But every buyer conversation since has had a sense of the ‘Erewhon stamp of approval.’”
Healthy Brands Team Up To Educate Public About the Risks of Excessive Sugar
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This article originally appeared in Presence Marketing’s February 2022 Industry Newsletter
By Steve Hoffman
A band of seven “better for you” food and beverage brands announced in January 2022 that they have come together to form a new health coalition named ACES, the Alliance to Control Excessive Sugar. The companies include Enlightened, HighKey, Koia, Lemon Perfect, OLIPOP, Super Coffee and Three Wishes. Competitors in the marketplace, the companies are unified in their mission to help consumers reduce sugar in their diets, the coalition said in a statement.
Despite the well-documented harmful effects of high-sugar diets, Americans knowingly and unknowingly consumed over 84 billion pounds of sugar in 2021, due in large part to added or hidden sugars. Additionally, many low- or no-sugar products on the market contain synthetic sweeteners, which can trigger insulin release and alter gut bacteria, and other potentially harmful ingredients, said the ACES statement.
"America's go-to brands are loaded with sugar and unnecessary calories that make food and drinks taste good but at the expense of health and wellness," said Jimmy DeCicco, CEO of Super Coffee and Chair of the ACES coalition. "At ACES, we're committed to showing consumers that there's a better way – food and beverages that are low in sugar and don't compromise on taste. Our combined impact is far greater than any single brand alone, which is why we're banding together for the betterment of our community.”
As a first step, the ACES coalition launched a website where consumers can learn more about the mission. ACES said it also will be giving away $1 million worth of discounts to consumers as incentives to remove sugar from their diets. For information, visit https://sweetaces.org.
U.S. Consumers Want Snacks with a “Broader Consciousness,” Survey Finds
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This article originally appeared in Presence Marketing’s February 2022 Industry Newsletter
By Steve Hoffman
A majority of consumers are incorporating their environmental and social values into what snacks they choose to buy, and these trends are likely to intensify, according to the Third Annual State of Snacking, published by The Harris Poll, Mondelez and NextAtlas.
A poll of 3,055 people globally found that 85% of consumers said they either purchase or would like to buy snacks from companies that are working to offset their environmental impact and 87% or those surveyed say they preferred products that are produced in a way that is fair and lawful to all the workers involved.
Data from the poll also revealed that between 75% and 78% of consumers say low-waste packaging, fair labor practices, animal welfare and environmental concerns are currently impacting their food choices, and these same consumers expect those issues to affect 92% or more of their food choices in the next 10 years.
"We now see data emerging that demonstrate how consumers are evolving their snacking behaviors and purchasing decisions to more fully align with their values," Mondelez CEO Dirk Van de Put said in a statement.
USDA Renames GMOs as “Bioengineered” or “BE” Foods as New National Labeling Rules Take Effect
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This article originally appeared in Presence Marketing’s February 2022 Industry Newsletter
By Steve Hoffman
Once upon a time, in 2016, the small but mighty state or Vermont implemented a law it had passed requiring companies selling food products in the state that contained genetically modified ingredients to label such products as made with “GMO” ingredients.
As a result of this first-ever GMO labeling law in the U.S., for a few months in the spring of 2016, consumers all across the country began to see GMO labeling disclosure on products containing such ingredients, as some manufacturers opted to label all packaging for the U.S. market rather than just print GMO-labeled boxes for Vermont. Such was the power of that state law mandating the consumer’s right to know.
Yet, reacting to Vermont’s GMO labeling law, Congress soon thereafter passed S. 764, sponsored in the House by former Kansas Rep. Mike Pompeo and in the Senate by former Kansas Sen. Pat Roberts, and signed in August 2016 by then President Barack Obama. Dubbed the DARK Act for “Deny Americans the Right to Know,” the law established voluntary labeling much less stringent than Vermont’s previous law, and it pre-empted states from mandating GMO labeling. Published in 2018, the National Bioengineered Food Disclosure Standard directed the USDA to establish a national mandatory standard for disclosing foods that are, or may be, bioengineered.
"The National Bioengineered Food Disclosure Standard increases the transparency of our nation's food system, establishing guidelines for regulated entities on when and how to disclose bioengineered ingredients," former USDA Secretary Sonny Perdue said at the time. "This ensures clear information and labeling consistency for consumers about the ingredients in their food,” he said.
Now, as of January 1, 2022, food previously known as GMO or genetically engineered has a new name. According to USDA, such products will now display a “Bioengineered” (BE) label. Critics of the new labeling regulations are concerned that the new GMO “rebrand” may cause more confusion and less transparency, as most consumers are familiar with the term GMO, genetically modified organism or genetically engineered.
"The worst part of this law is the use of the term 'bioengineered' because that's not a term most consumers are familiar with," Gregory Jaffe, Director of the Center for Science in the Public Interest's (CSPI) biotechnology project, told the Washington Post.
Companies with products made with bioengineered ingredients have a number of options to comply with the new standard, NPR reported. They can include text on food packages that says "bioengineered food" or "contains a bioengineered food ingredient," or they can choose from two friendly-looking “BE” logos created and approved by the USDA. Or, they can include a QR code for consumers to scan or a phone number for them to text that will provide more information about that food item.
In addition, according to a lawsuit filed in 2020 against the USDA in federal court by the Center for Food Safety, the new GMO labeling standard prohibits producers from using more common labeling terms such as "GMO," plus it will leave out many foods that are "highly refined" or contain levels of bioengineered ingredients that aren't detectable, such as soda and cooking oil, CSP said.
The new standard also discriminates against the poor, the elderly, people who live in rural areas and minorities who may lack access to a smartphone or the internet, CFS said. It also puts an "undue burden" on shoppers to scan food items in stores during the ongoing COVID-19 pandemic, critics of the new labeling standard have asserted.
"Consumers have fought for decades for their right to know what's in their food and how it's produced," said Meredith Stevenson, CFS attorney and counsel in the litigation, in a December 2021 statement. "But instead of providing meaningful labeling, USDA's final rules will only create more uncertainty for consumers, retailers, and manufacturers."
Some commonly bioengineered foods include corn, canola, soybeans and sugar beets. Most GMO crops are used for animal feed, according to the Food and Drug Administration (FDA). However, they are also used to make ingredients, such as cornstarch, corn syrup, canola oil and sugar, that routinely find their way into products for human consumption.
Organic Insider: An Interview with Max Goldberg on the Next Compass Coffee Talk, February 9, 11:30am EST
Max Goldberg, Founder and Editor, Organic Insider
Max will join podcast co-hosts Steven Hoffman and Bill Capsalis for a lively discussion on the opportunities and challenges facing businesses dedicated to organic food and agriculture; how consumer demand is driving innovation in the organic products market; and how organic products marketers can best navigate an uncertain market for success in the future.
Goldberg will share his perspectives on where the organic industry has come from; and how the global pandemic combined with heightened consumer demand for organic and unprecedented supply chain disruptions will shape the future of the organic industry. Importantly, Max will speak to how organic food & agriculture, by sequestering CO2 from the atmosphere back into healthy organic soils, can play a key role in helping to mitigate global climate change.
About Max Goldberg
Called “an organic sensation” by The New York Times and named as “one of the nation’s leading organic food experts” by Shape magazine, Max Goldberg is the Founder/Editor of Organic Insider, a newsletter read by many of the most influential CEOs in the industry today. He has been covering the organic industry for the past 11 years and also runs the Organic Food Industry group on LinkedIn, which counts more than 35,000 members from around the world. A former Wall Street banker, Max received his BA from Brown University and his MBA from the Columbia University Graduate School of Business.
About Compass Coffee Talk™
Take a 30-minute virtual coffee break with Compass Coffee Talk™. Hosted by natural industry veterans Bill Capsalis and Steve Hoffman, Coffee Talk features lively interactive conversations with industry leaders and experts designed to help guide entrepreneurs and businesses of any size succeed in the market for natural, organic, regenerative, hemp-derived and other eco-friendly products.
Compass Coffee Talk™ is produced by Compass Natural Marketing, a leading PR, branding and business development agency serving the natural and organic products industry. Learn more.
VIEW OUR PAST COMPASS COFFEE TALK EPISODES ON YOUTUBE
Ultra-processed Foods Considered a Risk Factor in U.S. Public Health Crisis
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This article originally appeared in Presence Marketing’s January 2022 Industry Newsletter
By Steve Hoffman
Ultra-processed foods – so named because they are often formulated to directly target the brain’s reward centers quickly and powerfully – are becoming enough of a concern among nutrition experts and policy makers that Newsweek featured it as the cover story of its Dec. 8, 2021, edition, entitled “Toxic Food.” Diet-related health conditions including obesity, cardiovascular disease and diabetes have significantly raised the risks of hospitalization and death during the Covid-19 pandemic, bringing addiction to ultra-processed foods to light.
“At issue,” Newsweek reported, “is the explosive growth in a broad class of food products that are not merely processed in the conventional sense to lengthen shelf life, but are also often modified to maximize flavor, visual appeal, texture, odor and the speed with which they are digested. These foods are made by deconstructing natural food into its chemical constituents, modifying them and recombining them into new forms that bear little resemblance to anything found in nature. So radically are they altered that nutrition scientists have given them a new name: ultra-processed.”
Major culprits are ingredients including sugar and processed grains that have been stripped of their outer shell, or bran, and the inner germ, which contain key nutrients such as fiber and essential fatty acids, leaving only refined carbohydrates, Newsweek reported. According to Michael Moss, author of the 2013 book Salt Sugar Fat, recent studies show that 66% of food products in grocery stores now contain added sweeteners.
"These companies have learned how to find and exploit our basic instincts that attract us to food," Moss, whose most recent book, Hooked, explores food addiction, told Newsweek. "The problem isn't that these companies have engineered the perfect amount of sweetness for things like soda, cookies or ice cream. It's that they've marched around the grocery store, adding sugar to stuff that didn't used to be sweet, like bread and yogurts and spaghetti sauce. This has created this expectancy that everything should be sweet."
Market for Certified Glyphosate Residue Free Products Grew 170% Year over Year
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This article originally appeared in Presence Marketing’s January 2022 Industry Newsletter
By Steve Hoffman
Leading market research provider SPINS reported in partnership with the Detox Project that sales of products that are certified Glyphosate Residue Free increased 170% year over year, from $197 million the previous year to $533 million in 2021. The Glyphosate Residue Free certification program was launched by the Detox Project in 2017, reported Sustainable Pulse. It is now one of the fastest growing certification programs in North America, according to a recent study conducted by Linkage Research & Consulting.
More than 90 brands have certified some or all of their products as Glyphosate Residue Free, including Oatly, MegaFood, Uncle Matt’s, Wedderspoon, Bluebird Botanicals, Malk, Nutiva, Once Upon a Farm, Califia Farms, Chobani and others. The certification program is administered by the Detox Project, a research and certification platform that supports transparency in food and supplements.
Henry Rowlands, Director of The Detox Project, said in a statement that “it is encouraging to see that consumers are becoming more aware of the harm that environmental toxins such as glyphosate can cause to themselves and their families. We support a toxic free future for our children and this can only be reached through mass public awareness. Food and supplement brands play a vital role in keeping consumers safe from toxic chemicals. The unsustainable industrial agricultural system, which has been poisoning the planet for so many decades, Is based on one single chemical – glyphosate. It is about time that we move towards a more regenerative future with glyphosate-based weed killers left in the past, where they belong,” Rowlands concluded.
California Set to Launch Largest Food Waste Recycling Program in the U.S.
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This article originally appeared in Presence Marketing’s January 2022 Industry Newsletter
By Steve Hoffman
Beginning January 1, Californians are now required to separate organic material such as unused food, coffee grounds, egg shells, fruit and vegetable scraps, and other food waste into compost bins used for green waste including lawn and garden clippings, leaves and other organic debris, Yale Environment 360 reported in December.
Under California’s Senate Bill 1383, now in effect, the state’s waste disposal services will now divert the organic material away from traditional landfills to facilities that will manufacture compost, mulch and other products, reported the Los Angeles Times in December. According to the Times, individuals and business that don’t adequately separate their organic waste can face fines of up to $500 per day. Cities that are found in noncompliance could pay up to $10,000 per violation.
According to CalRecycle, the state agency overseeing the transition, over 50% of all trash produced by Californians is organic materials, such as kitchen scraps and garden waste. “The goal of the new state law is to reprocess 75% of the green waste by 2025. That means redirecting 17.7 million tons of organic material away from disposal, equivalent to the weight of more than 9.5 million cars,” the Los Angeles Times reported.
The new recycling law was originally passed in 2016 under former Governor Jerry Brown’s administration, with the goal of reducing waste in landfills and returning organics to the land to improve soil quality, increase drought resistance and reduce production of methane and other greenhouse gases. “This is the biggest change to trash since recycling started in the 1980s,” Rachel Wagoner, Director of the California Department of Resources Recycling and Recovery, told the Associated Press. It…“is the single easiest and fastest thing that every single person can do to affect climate change,” she said.
Single-use Plastic Waste a Major Concern for Majority of Consumers
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This article originally appeared in Presence Marketing’s January 2022 Industry Newsletter
By Steve Hoffman
According to the Hartman Group’s new report, Sustainability 2021: Environment and Society in Focus, more than four out of five consumers say that they are very concerned about the amount of single-use plastic that we are using as a society. Survey respondents also expressed concern about single-use plastic’s implications not only for the environment but also for human health. Plastic and other packaging waste are among the most visible aspects of sustainability to consumers because they must actively participate in the process of disposing these items and determining what can be recycled, reported the Hartman Group. The market research firm added that consumers feel it is up to companies to offer better solutions that allow them to rely less on plastic while maintaining the convenience they have come to expect.
The Future Is Now: Delivery Robot Carts Hit the Streets for Erewhon Market
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This article originally appeared in Presence Marketing’s January 2022 Industry Newsletter
By Steve Hoffman
A robot-powered delivery service that launched in California in 2020 announced that it will begin grocery deliveries for Los Angeles-based natural products retail chain Erewhon Market with a bigger, more powerful version of its proprietary delivery robot, Winsight Grocery Business reported. The new robot model, COCO1, features longer battery life than the original model, allowing for a delivery radius of up to three miles, twice as far as the original model could travel. The bigger robot cart size allows for it to hold up to four grocery bags at the time, the robot’s maker, Coco, said. The cart’s cameras and sensors allow for remote pilots to plan efficient delivery routes and navigate walkways and streets, said the company, making COCO1 “the perfect vessel for metropolitan grocery delivery.” The robot was designed and built in partnership with Segway, Winsight Grocery Business reported. COCO1 delivery robots will be stationed at all seven Erewhon locations in the Los Angeles area, Coco said. The company also stated that its service boasts a 97% on-time delivery rate, and the robot maker recently completed a $36 million Series A funding round, which promises for more robots in the future.