Provenance and quality matter for all our products, even the bulky ones
International marketing specialist Craig Davis was the keynote speaker at the Tasmanian Farmers and Graziers Association conference last week. His presentation generated a lot of excitement amongst the large audience of people from all parts of the agribusiness world.
Davis, whose background is with J Walter Thompson and Saatchi and Saatchi, delivered an ad man’s view of the options we have for making greater inroads into overseas markets.
In a nutshell, he argued that our reputation for clean, green and safe was run of the mill, and that we needed to move the bar higher – to concentrate on super premium food products and to focus on being the cleanest, the greenest, the safest in the world.
Provenance and “premium-ness” were the key, he said.
“People want to know where it comes from and from whom.
“People don’t buy what you do; they buy why you do what you do.”
He suggested a theme for Tasmania to “nurture immaculate food experiences”, going 100 per cent organic, using 100 per cent renewable energy with zero per cent waste.
This led the Mercury to comment in an editorial over the weekend:
“The sooner Tasmania moves away from commodities into high-end goods and services that are dependent on the very best systems of quality control, the quicker we will be insulated from the fallout of the Asian economic transformation.”
With respect, I think Craig Davis’ message was somewhat lost in translation.
What he said was that Australian farmers can only ever expect to feed a population of 150 million and that, with Asia’s population climbing through 3.5 billion, we are never going to be the food bowl of Asia. But we should aim for high quality produce that sells at a premium – and perhaps be the deli with our boutique products
Of course, he is right – and it is what we are already doing.
Tasmanian farmers are already well ahead of the game in recognising the importance of Asia as an export destination. In 2011/2012, agricultural exports from Tasmania were valued at approximately $1,000 million, with more than 10% of these products being destined for ASEAN countries.
Davis is right when he says we should be targeting those consumers here and overseas who want the clean, green premium products that we produce so well – the best beef, wine, berries, wasabi, oysters, crayfish, abalone, dairy products, salmon, beer, vegetables, fruit – the list goes on. He’s on the money when he says we should be putting a human face to this production. And he’s spot on when he suggests we need to be lifting the bar, aiming to develop a distinct point of difference through offering ‘super-premium’ products.
However, what the figures – and everyday experience – clearly tell us is that high value boutique products are the agricultural equivalent of the tip of the iceberg. They are important brand leaders for our farmers in these increasingly Westernised countries, and they certainly offer valuable opportunities in premium markets.
But farmers cannot produce ‘super-premium’ products at the exclusion of all else. This will only ever be in addition to continuing to produce what puts the bread and butter of the plate of every farmer – bulk, unbranded commodity goods at which we excel – milk for processing, potatoes, vegetables, seed crops, poppies, etc.
Eighty per cent of what we produce is commodities bound for processing or value adding, and to the major supermarket chains or overseas marketers. This is where Tasmanian farmers get the money to pay their bills.
Our bulk, unbranded commodity products are without doubt up there amongst the best in the world. However, they are like the vast mass of the iceberg that sits below the surface of the water, and supports the more visible and higher priced boutique products that underpin our hard-won ‘super-premium’ brand image.
If we were manufacturing products, we could turn out endless runs of identical premium widgets. There would be no second grade products, no variations and little wastage. Farmers, though, are not producing widgets. They are dealing with nature in all its myriad of variations, and that means premium product will only ever be a small proportion of the end output.
There are many examples of this in practice.
Only a small proportion of our cherries makes the grade as premium product in Asian markets. We get to share in these delights, with the product that doesn’t quite meet those exacting standards being sold on the local market. Our magnificent cuts of beef that are renowned the world over for their excellent eating quality are only a small proportion of the product that comes from each cow. The lesser cuts and rissoles, sausages are still world class – but don’t attract that same premium price. Similarly, we make some outstanding wines that attract premiums from wine aficionados across the world; while at the same time producing excellent mid-range wines that we can afford to drink regularly.
So, Davis’s message is an important one for all Tasmanian farmers. We need to focus on demonstrating provenance and aim to lift the bar for all our products. On top of that, we need to increase the size of the tip of the iceberg by developing a reputation for ‘super-premium’ products in the high value markets emerging to our north.
TFGA Chief Executive Jan Davis
