In US Food Industry, Cheap Can Be Tricky

Grocery Shopping
Any American can tell you that competition is key in a strained economy – for jobs, for the lowest prices, etc.  The claws are out as people across the country go to extremes to make and save money.  It’s not just the individuals who are competing, but the American businesses, as well.

Recently, competitive juices have been poisoning the ethics of the food industry.  The issue of “food fraud” is on the rise as aggressive strategies turn to deceit.  Food fraud is when food items are sold under false claims.  A number of reputable publications including the Washington Post and Newsweek have explored the aggravation of the issue during the recession.  An eye-opening article by Lyndsey Layton in the Washington Post highlights a few sneaky examples:

“The expensive ‘sheep’s milk’ cheese in a Manhattan market was really made from cow’s milk. And a jar of ‘Sturgeon caviar’ was, in fact, Mississippi paddlefish. Some honey makers dilute their honey with sugar beets or corn syrup, their competitors say, but still market it as 100 percent pure at a premium price.”

(image courtesy of http://www.dreamstime.com/royalty-free-stock-photo-gourmet-food-collage-image3333785)
(image courtesy of http://www.dreamstime.com/royalty-free-stock-photo-gourmet-food-collage-image3333785)

According to Helena Bottemiller of Food Safety News, Food scammers have tricked not only shoppers, and but also big distribution companies like Heinz USA.  According to Brandon Glenn of Med City News, an estimated 5 to 7 percent of US food supply is involved in food fraud.

Fast-paced global trade and the growing demand for cheaper food have intensified the problem, and the FDA is feeling the heat as American urge them to crackdown on product labeling and authentification.  This is where technology comes in: advanced DNA testing allows scientists to compare products to a database of samples to prove their legitimacy.  Unfortunately, Newsweek reports, the FDA doesn’t have the resources to inspect the majority of the foods in the American supply.  Looks like we as consumers have to stay on our toes.

So don’t let your bargain obsession impair your judgment – if that sweet deal for gourmet treats looks too good to be true, it probably is.

Fast Food Banks on Cheap and Fun

Fast food is famous for being quick and cheap.  And these days, cheap is chic.  So fast food companies like Burger King and Taco Bell are rolling out the bargains and highlighting these money-saving specials any way that they can.  Taco Bell called in Charles Barkley in their recent “Five Buck Box” commercials to entice consumers to try out their meal deal:

[kml_flashembed movie="http://www.youtube.com/v/Jf5KfRaZShs" width="425" height="350" wmode="transparent" /]

While fast food companies initially saw profits in the economic downturn, they are now facing sales dips in conjunction with higher unemployment rates.  As Ron Paul, the president of consulting firm Technomic explains to USA Today, people are getting more food from grocery stores and choosing to cook at home.

“Now, as the U.S. unemployment rate remains uncomfortably high, chains are struggling to keep Americans eating out at all.”
– Ben Steverman, BusinessWeek

Mac Snack Wrap

But the fast food leaders aren’t giving up.  Research from Consumer and Market Demand Network Papers proves that when fast food businesses promote low prices, demand increases, so these guys are persistent.  McDonald’s recently premiered their new Mac Snack Wrap for $1.59 to appeal to Big Mac Lovers.  They converted the famous sandwich into a tortilla form and made it cheaper.  Yum!

bkdouble

Burger King is also playing up the deals with their vast array of choices on the $1 Value Menu which includes the BK Double Cheeseburger and Crown-Shaped Chicken Tenders (yes, they went there).  I decided to check out the BK website to see how the company is promoting these tasty treats and stumbled upon their unique promotional tools.  For instance, BK is hosting the “$1 Talent Show” in which they ask consumers to upload videos of their $1 party tricks to receive Virtual Gift Cards for items off of the Value Menu.  They also have a homepage feature that allows users to customize their experience on the site through three different controls: Fun, Food, and King.  You can adjust the levels of each so if you want more food information than interactive games and contests, you can “have it your way.”  The company is having a blast with convergence and interactivity by getting consumers to play on their website and, hopefully, pay for their grub.

Billboard’s just don’t cut it anymore.  Digital is delicious.