Adapting to changes in market demand

Growing consumer demand for clean and green products can no longer be ignored. Two thirds of global consumers now spend more on brands that minimise their impacts on the environment. And innovations like blockchain are helping consumers make better informed choices by verifying product integrity.

So, now more than ever, businesses need to build trust in their products to maintain or increase sales. The importance of trust is not lost on Australian agricultural bodies such as Australian Wool Innovation (AWI) Limited.

AWI’s Manager for Corporate Communications, Marius Cuming, recently spoke about the ‘social license to farm’ concept at Southern Dirt’s Spring Field Day in Kojonup.

According to Marius, maintaining or gaining market share depends a lot on understanding markets and building consumer trust. For wool, 99 per cent of the market is in the northern hemisphere, where buyers are looking for products with transparent supply chains and good environmental credentials.

“That’s what we are hearing from retailers,” Marius said. “Consumers want to know that when they purchase a garment that it’s come from a farm where the animals have been treated well and the landscape has been looked after. Millennials who have a high disposable income want to feel good when they purchase a product. It’s an evolution of the market and the industry has to adapt”

A major environmental issue in the northern hemisphere is fast fashion, where low cost products made from non-biodegradable fabrics like polyester with big carbon footprints, are mass produced but only worn a few times each. Marius thinks the wool industry can turn this issue into an advantage because wool is completely biodegradable and does not contain plastic.

It is a great story for the broader wool industry, but it is only one part of a bigger picture. Another story can be told about a product’s provenance, or where the product came from and how it is produced. With this more comprehensive story comes more transparency and trust.

But how can growers start this process?

Marius explained that for wool, having the national wool declaration filled out is important because that is where producers can demonstrate what they have achieved.

“Development of the WoolQ TM portal will give farmers a greater opportunity to market their wool to the world, and also open up opportunities for collective marketing, potentially based on land type, bloodline or region,” Marius said.

Marius believes that instead of farmers having to push their products out, it may actually work the other way around. That is, if a group markets itself with a story demonstrating how they care for their animals or land, international buyers will come knocking.

“That’s what we’ve seen with a UK retailer wanting to buy Flinders Ranges merino. We’ve also seen Kangaroo Island and super-fine merinos develop their own brand. There’s no reason why people in WA can’t do something similar,” Marius said.

A good example of how this might work is outlined in AWI’s Yarn podcast (episode 24) on provenance. It tells the story of Simon Cameron, a Tasmanian super-fine wool producer from the Kingston region who teamed up with a suiting brand to produce a line of suiting. The marketing campaign links the range back to the natural values of Kingston and how Simon integrates wool production with the management of natural values, with every sale contributing back to the farm for conservation work.

Integrating production and natural value management, or Landcare, is not uncommon, it just needs to be promoted to build trust.

Centre of Food Integrity CEO Charlie Arnott pointed out at the recent LambEx Conference in Perth that telling stories about provenance should not be seen as blatant self-promotion.

Charlie thinks these stories are critical to be able to earn and maintain social license, which he defines as “the privilege of operating with minimal formal restrictions based on maintaining public trust.” Charlie believes that if practices are not consistent with social expectations, we need to look for alternatives before change is either enforced by regulation or more quickly and just as effectively by the marketplace.

A recent example of the loss of social license leading to formal regulation is mulesing in New Zealand. Industry there began the push to phase out mulesing in 2007 amid animal welfare concerns. Eleven years later, the practice has been prohibited by the New Zealand Government.

SWCC thanks Southern Dirt for inviting Marius Cuming and other great speakers to Kojonup.

 

This article was written by the SWCC Regional Agriculture Landcare Facilitator Peter Clifton with support from the Australian Government’s National Landcare Program

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