Tuesday, February 10, 2009

Old, old piece about economics. Abandon hope all ye who etc, etc.

A couple of years ago I had the pleasure of working for one of Ireland's favourite 'Prophets of Doom' (if that's not crying out to be a rubbish indie band title I don't know what is) - certain idiosyncratic terminology will alert the careful reader as to which pundit it was. Towards the end of my service I had an idea about organic markets, niche(ish) companies like Apple, and the US company Whole Foods.

It was too late in the day for this to make the book. Actually, I have no idea if it did: I read numerous drafts during the editing process, but to date have not sat down with the published work. I doubt that there's any reference to it, though, which is why I am posting it here.

The following is me attempting to work out that idea w/r/t Ireland and keeping us out of what we all knew was coming. It's quite long, but I haven't spotted any readers on my blog yet, so I'm sure the yawning abyss of teh internets won't mind. Anyway, I'm thinking of returning to it with a view to making an article, so all you other unemployed journos - hands off.

Sad to say, I find this stuff desperately interesting, much more so than crafting the columns I posted last month, so I imagine there's no hope for me. Enjoy?

What are the advantages of an organic market? How does it work and attract customers?

1. Perception of extra value inherent in this food:

With the rise in awareness of how food reaches the end of our forks, equally the makeup of the customer shifts, so that we begin to think of food consumers as those who care (or have some interest) about what sort of food they eat and where it has come from; and those who don’t. Obviously, this is a middle-class issue for the most part – caring about your food on that level implies (or at least, this is usually the case) that you have the ability and financial wherewithal to make that choice without it collapsing your weekly/daily/monthly food budget. That said, the beginnings of most major trends are amongst the middle classes, from whence things trickle down and up. If organic food takes off among the middle classes, then prices will eventually drop as competition rises for the organic Euro and there will be a trickle down effect to the working classes. In addition, as the media is a middle class industry, the fashion towards organic food is advertised widely and fluently. All this allows organic food to enter the consumers vocabulary, and suddenly you find yourself at a dinner party where people know the difference between organic and free-range chickens and are prepared to spend 45 minutes discussing it, while you cower in your chair, hoping that no-one can tell that until this very moment that they have been eating a ‘Fresh’ (i.e., means nothing at all) chicken from Tesco’s for €4.99.

2. The sense that the customer is helping themselves and the earth:

If I buy organic food, I don’t just feel better about what I am eating, I feel better about myself. I am fattening my ego with every forkful of locally sourced rocket. I can say with some certainty that the animals who were killed to feed me had a reasonably good life, that my greens were grown in Ireland by farmers who weren’t using synthetic pesticides that may harm the long-term viability of the soil, and who paid their farmhands a fair wage. I can say that my bananas were sourced from a country that has a positive ethical record, and even the Mayan Gold Chocolate that is causing my fillings is grown from sustainable sources. Now, there are a lot of ‘if’s’ there, and not all organic food was created equal, as it were, but even if I am just buying the most cursorily ‘organic’ item, I automatically feel as though I have also bought a degree of food karma that separates me from the hordes at McDonalds. Whether or not a hardcore organic foodie would agree doesn’t matter, because I don’t know any, and in the same way that no-one who owns a copy of the Joshua Tree could really give a monkey’s about Niall Stokes’ claims that to be a true fan you probably had to have been at a gig in the Dandelion Market in August 1977 (or something), it doesn’t matter what a purist thinks, because they have been left out of the equation.

3. Use of organic food to tell others about who you are:

Food matters now in a way it didn’t before. It is a social hoop nowadays in a way that it wasn’t when we all had the same, Brussels sprout based cuisine way back when. More men are cooking now – Jamie Oliver & Gordon Ramsay have seen to that. More women are doing it for pleasure too – listen to the dinner party discussions about statuesque Nigella – and suddenly you look around and notice what and how people eat. It’s not everywhere, nor is it likely to be (at least in the same form: true organic, small-scale farming implies a smaller global populace – a hard proposition to swallow), but buying organic food is now another thing that you must do in order to fit in with the world, making it a prime Juggler objective.

4. How is organic food sold & marketed?

Traditionally, organic food has been sold at farmers markets and in some cases as part of a collective co-operative general market (with all the vaguely crusty connotations that implies). However, as we all know, the rise in awareness of its benefits, anti-processed food bestsellers like Fast Food Nation and new celebrity chefs mean that to be organic is no longer exclusively associated with that world, and so it is desirable. In Ireland, we have a few different varieties:

Farmers market:
This is the basic foodie market. There’s a well-known one in Temple Bar every Saturday, though it is gradually morphing into an outdoor food court. There are some in Dalkey, DĂșn Laoghaire and a few other places as well, I think. These tend to have a couple of vegetable suppliers and maybe a craft stall or two. They aren’t always comprehensive – you couldn’t do a full shop, necessarily – but they have nice stuff and have a reasonable audience. They do tend to be seasonal and this has a major effect on their custom as the stall that was there last week might spontaneously disappear to be replaced by six guys selling wooden toy substitutes.

Co-Operative Market:
This is the next step up, and probably the classic example of how this can be a successful long term enterprise. There’s one on Pearse Street, inside a school hall, every Saturday, which has run forever, it seems. In one of these, the customer ‘joins’ as a member for a period (usually a year is what’s offered, although you can come along and pay a daily rate of €2 or something to gain access). Inside, you’ll find something much closer to the normal idea of a supermarket, with stalls that sell most everything you might need (as long as you don’t eat meat). It is always packed. Customers range from students just back from their gap year in Nepal to D4 Dames and curious locals.

Whole Foods:
This is one of the major food chains in the USA. They don’t have an outlet here. In 2004 they had total sales of $4.6 billion. They are like Wal-Mart in that they are an aggressively expanding corporation who are now in the UK also (bought a chain called Fresh & Wild last year), and in being anti-union. Their big selling point is that they are organic. They have harnessed the organic market in the US and consolidated their position at the centre of it. In fact, a better comparison may be to Starbucks or Google, other growth-hungry companies with much vaunted ethical credentials. As with Apple, Whole Foods is noticeably more expensive than other supermarkets. Despite this, it has been exponentially successful, drawing more and more Americans through its doors. It should be pointed out that the industrialization of organic food by this company has not gone without comment. Detractors suggest that the laws governing what can be labeled ‘organic’ in the US are not consistent with what we, as customers, might deem organic. Equally, the company’s anti-union stance is understandably not a great hit with the traditionalist, though it is entirely consistent with its and America’s industry in general.

That all said, Whole Foods has managed to do something that it’s competitors have not managed, and which you can see in things like Tesco’s Finest range and how Superquinn presents itself in general.

Broadly speaking, the problem with modern life for many people is the anonymity of it. We don’t know how things get to us, whether it be the food on the end of our fork or indeed the fork itself. What organic food offers is the (perhaps pointless on occasion, but comforting) knowledge that our food came from somewhere, was made by someone, and with some attempt at craftsmanship and value. What a company like Whole Foods does is put that feeling into a biodegradable cardboard package and sells it in 191 locations all over the United States. It has cracked the code – taking what is good about the smalltime farmers market or co-op and puts that together with the wide distribution, marketing reach, the efficiency, of a giant multiple.

This is not now the most popular way to shop, and for many people it may never be, but it is gaining in popularity at the expense of those who would pile it high and sell it cheap. Tesco’s understands this dynamic, which is why if you walk into their poultry section you will see a clear hierarchy of shelving, with the expensive, traceable organic chicken at the top, then the slightly cheaper free-range compromise (like ‘diet organic’) at eye level. Below all this, in much greater quantities, you will find ‘fresh’ chicken (you could have great fun examining exactly what Tesco’s have to sell to call a chicken ‘fresh’). You’ll see the subtle changes in packaging between the types and you will have to admit that the supermarket is adept at having its cake and eating it.

In the new Grand Canal Dock development, on the quay side, you’ll see our very own Whole Foods: Fresh, set up by the property developer Simon Kelly (Thomas Read group). The first was set up in Smithfield at a cost of €15 million in 2006, according to the Business Post. It’s conceived (apparently) as a competitor for SuperValu and is supplied by BWG, who own the Spar franchise. But let me be the one to tell you that it bears about as much resemblance to Spar (or Supervalu/Centra/Mace) as I do to a cereal box. It’s filled with organic stuff, very expensively fitted out and extremely tasteful. It’s not cheap, neither. When I strolled in avec Sol last Saturday morning (searching for croissants & The Guardian, because I am a caricature), I found the temple of the Juggler. This, mind you, is a place for the successful Juggler, or at least the one who can look successful, It was very quiet, some tasteful jazz in the background, female marketing exec’s in asymmetrical jogging tops, early middle-aged fathers in parkas and trainers pushing their one angelic child (with de rigeur ringlets, whether boy or girl) around the organic cereal section, looking for the Coco Pops hidden at the back. Needless to say, I was awash in croissants of al shapes and sizes and had no trouble sourcing my fix of The Guardian. It was very clear that the customers were predominantly women – well over two thirds of the magazine rack was devoted to women’s interest publications, with a very lonely copy of Four Four Two looking like David Beckham at a lingerie party.


Ultimately, what I see with these places is a mode of thinking which differs from the traditional retailer in one major respect: they are not selling merely the product, but the experience. Because of this, there is a sense of participation. If I buy an Apple iPod I feel in some peripheral way cooler and more networked into a world that I previously felt distant from. Equally, I might be a rubbish cook, but I get a warm fuzzy feeling of accomplishment when I buy all my food from organic suppliers. The fact that I could have bought an MP3 player for half the price or 6 TV dinners from Tesco instead and had more money doesn’t occur to me as a viable alternative, because I am not interested in those things. Whole Foods have sold me a version of myself that I much prefer to the one with five quid more in his pocket and a stomachache. I have decided that this food equals health in the same way that Apple equals a certain type of coolness to which I aspire. There are so many things that are sold this way nowadays. People are building using sustainable techniques, partly because on an intellectual level they appreciate the ethical argument and can see the long term economic benefits, but mainly because they love the houses they’ve seen on Grand Designs and want to keep up with the Duffy-McKenna’s. This is in a funny way, exactly why the Jugglers are what they are. They have grasped the American go-getting ideal with both hands, but in the main have not grabbed the necessary wallets.

The organic market gets you in the door because you want to be there, not because they have come out to collar you. They have done this by making what they have as appealing as possible and at the same time, educated you into understanding that there is a perfectly understandable financial cost for such an incredible experience. As you have mentioned, we’ll never keep Google in Dublin because of our amazingly low salary scales or our tropical weather. We will keep them by selling ourselves as the only logical place for a successful company of that nature to be in, from a strategic, emotional and cultural standpoint. It’s that same tactic that will attract the diaspora.

1 comment:

  1. Hey Eoin, thought this might interest you;


    he goes on to talk about these guys and the concept of grass farming,;




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Welcome to my blog. I'm a freelance writer/journalist/researcher/editor. I write about education and ideas I've had for the Irish Times. I also research, write and edit for writers, publications and websites. Here I put things that tend not to fit anywhere else. Enjoy.

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