Business and Operations
Marketing insights: June 2015
One hot food trend consistently popping up is “authenticity.” It’s a bit ambiguous – what exactly does authentic mean to you the operator, and more importantly, to the consumer?
Referred to as a protected designation of origin (PDO) or protected geographical indication (PGI), these designations are about telling stories. These stories can be romantic or pragmatic but they are only good to your business if they helps increase sales.
Obtaining the designation is a major undertaking involving time and money so … what’s in a name?
There are many food and beverages bearing protected names of origin. Gorgonzola, Parmigiano-Reggiano, Cognac, Champagne, Italy’s DOC (Denominazione di origine controllata) and Ontario and B.C.’s VQA (Vintners Quality Alliance) are all designated terms developed to ensure only those products legitimately originating from a specific geographical area can be named after the area they were grown in. The wine industry term “terroir” refers to a sense of place: protected names are designed to communicate that sense of place. The purpose of the designation is to uphold and promote the reputation of the regional foods, highlight local agricultural activity, and of course command a premium price for this reputation. Protecting the designation legally helps to eliminate the proliferation of “knock-off” products that may mislead consumers and not be represenative of the standard in terms of quality or flavour experience.
One of the most recognizable protected names is Champagne. Under an 1891 treaty, only sparkling wines made from grapes grown in the Champagne region of France may bear the name Champagne. Napoleon was famous for saying “Champagne, in victory one deserves it; in defeat one needs it.” Canadian wines (still and sparkling) are often marketed under the VQA designation. VQA is a protected quality standard used throughout Canada’s wine industry to ensure the wines are clearly made and labelled to represent the appellation they are grown in.
In pizza’s instance, the designation is designed to protect how it’s made.
Based in Naples, Italy, for several decades, the Associazione Verace Pizza Napoletana (VPN), a non-profit organization, strives to “promote and protect … true Neapolitan pizza.” The association doesn’t mandate that authentic pizza has to come from a specific locale. Rather, they say it can come from anywhere, as long as it is made according to the “traditional methods” upholding strict quality standards. In Canada, 14 restaurants hold the VPN certification (americas.pizzanapoletana.org). A VPN pizza boasts many regulated features including a crust made from very fine Tipo 00 flour, kneaded by hand then cooked directly on the deck of a wood-fired oven at a temperature of 900 F. The pizza is topped with tomatoes grown in the volcanic soils of Mount Vesuvius. It takes time, money and hard work to earn the designation, so it makes sense to ask … is it just bragging rights or is there a business opportunity in a formal designation?
As consumers yearn for authentic, high-quality foods, the research suggests that this is a category worth pursuing. According to Mintel, specialty food sales grew by 18.4 per cent from 2011 to 2013 and eight per cent in 2013 alone. Between 2011 and 2013, sales of specialty food jumped by 18.4 per cent, outpacing sales of all food, which grew by only 5.2 per cent. According to the Specialty Food Association with support from Mintel research, specialty foods owned 15 per cent share of the total food market in 2014. The association defines specialty food as “products of premium quality that may be made by small or local manufacturers, feature ethnic flavors or contain the best available ingredients.” Most of these sales were through retail stores with 22 per cent sold through food service. “Retail sales of specialty food grew 19 per cent from 2012 to 2014, well ahead of the two per cent increase for all food. Foodservice sales have grown nearly 31 per cent between 2012 and 2014, while retail sales rose nearly 20 per cent.
The degree to which a protected designation commands a premium price seems to depend on how long the designation has been protected. According to www.communitytable.com, the average price in the United States for a VPN-certified pizza $13.21. The VPN designation has existed since 1984.
A protected designation is like any other brand: it must be built, nurtured and defended against all erosion. The advantage in leveraging a designation like VPN is in the story it gives you access to. Describe the silky fineness of the flour, the gentle hand kneading, the luscious tomatoes grown on the volcanic mountain and the flavour of the charred crust.
Give your menu a sense of place, your customers a sense of quality and flavour, and your pizzeria a point of difference.
Michelle Brisebois is a marketing professional with experience in the food, pharmaceutical and financial services industries. She specializes in brand strategies.