Magazine article Marketing

Retailers in Retreat on Frankenstein Foods

Magazine article Marketing

Retailers in Retreat on Frankenstein Foods

Article excerpt

Iceland is reaping rewards from its policy on GM food and its retailing rivals are following suit. Alex Jardine reports on how retailers have changed their minds

The major supermarket chains must have been kicking themselves last week as Iceland unveiled its annual results. In a tough climate where the other food retailers are fighting it out on price, the mass market frozen food retailer managed to turn in a strong set of figures, with food sales up by 12% and profits up 10% to [pounds]55m.

The reasons, according to Iceland, included the very public ethical stance it has take n against genetically modified food. By banning GM ingredients from its own-label products and launching products such as a 'green' range of fridges and freezers (called Kyoto after the Kyoto conference on climate change), Iceland has done wonders for its brand, drawing new customers into its stores and even winning praise from Friends of the Earth. But when it called a ban on GM ingredients last May, Iceland's stance was derided by other retailers; at a time when Monsanto was heavily advertising the benefits of GM, they dismissed it as a PR stunt. Nine months on, with GM foods rapidly replacing BSE as food's public enemy number one, Iceland's approach has definitely spurred the other supermarkets into action.

But the question of whether GM 'bans' are genuine investments or misleading PR still hangs in the air. Tesco - the grocery market leader - has refused so far to issue a GM ban, claiming it will only do so when it can truthfully claim to have eliminated all traces of GM ingredients. A spokesman says: "We believe other supermarket chains are being extremely disingenuous to their customers, It is very difficult to source non-GM ingredients, and to eliminate them from products. We want to make sure that we can deliver our promises rather than offering customers false hopes."

So is Iceland being honest with consumers? Its chairman Malcolm Walker - the man who claims to have coined the phrase 'Frankenstein Foods' - was quick to condemn a recent critical article in The Express, which claimed that Iceland was incorrect in describing own-brand foods as non-genetically modified. He argues that because materials can be transferred at a molecular level, even in the air that we breathe, as a result the food industry has to work with tolerance levels. Walker said: "In a climate where tolerance levels have yet to be agreed for genetically modified food, we work with levels that are under 1%, when the accepted tolerance level for organic food is 5%. …

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