The start of a new year is the perfect opportunity to reflect on significant events in the previous one. The passage of time lets us properly consider their impact, find meaningful conclusions, identify associations, and gain insights into how events may shape the future development of a business or industry. In this article, we look at the confectionery industry, analyzing a broad global data set to identify pertinent developments in 2020 that will have an impact in 2021.
2020 was completely dominated by one event – COVID-19. From a business perspective, companies were forced to make dramatic changes very quickly to the way they operated as lockdowns were ordered and revenues rapidly dropped. Unfortunately, for some businesses, particularly smaller ones, these were insurmountable obstacles.
COVID-19 has also had another, more interesting impact on businesses. We have seen how trends that were already underway have been accelerated by the pandemic. For example, the movement away from ‘bricks and mortar’ stores to online retailers has intensified and people are increasing using telemedicine.
For food and beverage producers, COVID-19 has accelerated trends in several areas but perhaps the most important for stakeholders to recognize is the increasing desire by governments to encourage healthier food choices. In particular, this means products that are low in salt, sugar and fat.
Adults of any age with health issues (obesity, severe obesity, Type 2 diabetes, etc.) are at greater risk from COVID-19. In many countries around the world, there were already concerns about the foods people were consuming, but the pandemic has served to refocus attention on this issue.
Governments have found themselves under pressure to act. One way in which they can be seen to be responding is through changes to labeling and packaging policy. The full impact of such changes can take some time to appear but analysis of Digicomply data from 2020 has already shown us a noticeable increase in articles (posts).
The graph above covers labeling-related articles that also included terms that were relevant to the confectionery industry, such as chocolate and candy. In comparison to 2019, we can see there has been a noticeable increase in articles for all sources in 2020. This trend is even more pronounced when we remove what are, in-effect, regulatory posts. This is relevant because news and scientific types of article often act as precursors to actual regulations.
In the above chart we can see that, following a quieter period when the pandemic was at its worst, there has been a noticeable increase in the number of mentions in news posts in the later part of 2020. Could this be a signal of what is to come in 2021?
When monitoring this topic over the last year, there are a couple of significant developments that warrant particular attention.
The most significant labeling change in 2020 is Mexico’s NOM 051. According to the Lancet, obesity is the primary public health concern in Mexico. The government has responded with arguably the world’s strongest set of warning icons for food labels. These are specific octagonal shaped icons to be placed on pre-packaged foods that exceed certain limits on salt, sugar and fat.
We have also been monitoring the UK's restrictions on promoting products that are high in fat, sugar and salt. Similar to Mexico, the UK government had been active in this area for some time, but the current pandemic has proved to be a catalyst due to the corollary effects of the virus and obesity. As a result, starting in April 2022, certain promotional language such as, “three for the price of two,” will no longer be allowed on a range of products, including confectionery, chocolate, cakes and sweets.
Tracking the progression of these developments using an effective monitoring system allows food producers to conduct relevant risk assessments at an early stage. This affords them the time to develop effective response plans based on the potential outcomes.
Both of these labeling developments raise a point that is always of interest to those of us that work in regulatory data analysis. At first glance, it may not appear that the data sets used to find the signals that later become broader trends have much in common. During 2020, Digicomply detected 809 publications (posts) that mentioned both COVID-19 and these particular product categories (including several that were tracking the two previous examples). At the end of the day, a trend is made up of disparate events that merge together to create a significant shift. The broader the sources and the more astute the system’s ability to ‘listen’ at scale, the better position you will be in to identify, at an early stage, changes that could impact your business.