It’s no secret that corporates are capable of innovating…(Yes — corporates, you read it right)
With this piece I want to offer a simple comparison between approaches to innovation using a real example: the fruit rolls-ups AKA fruit jerky
I believe food innovation doesn’t necessarily come from only startups. The Fruit Roll-ups were ‘invented” in early 1980’s and according to Wikipedia’s definition ‘The snack is a flat, pectin-based fruit-flavored snack, wrapped around a piece of cellophane for easier removal’
In a similar fashion of what entrepreneurs do, corporate people strive to come up with innovative ways to develop and successfully launch new products. General Mills introduced Fruit rollups in the United States in 1983.
Now the question is: is this what consumers would want to feed their kids with it all day long? Maybe in the 80’s consumers care less about this, but they definitely would not stick now
The problem is that they focus too much on (over)market their innovations and forget about what consumers actually want or even worse they take their marketing efforts to some extremes…(see below)
As a matter of fact General Mills was then forced to change the labelling of its fruit rolls as a consumer watchdog nonprofit, the Center for Science in the Public Interest, sued GM claiming that Fruit Roll-Ups’ packaging intentionally misled customers into believing that the snack was healthy and made of fruit.
Or even worse ‘playing’ with food to get product endorsement from influencers such as Jeremy Lin (a popular NBA Player) for whom they made a basketball jersey made entirely of fruit roll-ups.
On the other hand companies like Snact, Spare Fruit or Emily crisps have taken an ‘old’ product (such as fruit roll-ups) and made it relevant for consumers by making fruit jerky or dehydrated fruit snacks feel (really) more ‘human’, while making a dent in fighting food waste
This is what consumers are demanding today, food brands that speak their language, use real food to make their products and are transparent about how they make them.
Often time, ‘traditional’ approaches can be the most innovative ones and we’re definitely seeing a ‘going back to the roots’ consumers trend when it comes to new product developments from startups. One of my favorite US startups that I believe is well representing this movement is indeed called “Back to the roots” and states to ‘undo food’ (and they even trademarked the term).
But why is their approach different? Most food entrepreneurs are just there to challenge ‘the status quo’ as they want to drive (indeed) the change via creating new movements. I believe often times fellow founders see their work as a personal endeavor to change the rules of the game and create impact. This is where they find the energy and resilience to go through the startup rollercoaster (especially when it comes to building a food business).
In my days at Diageo I’ve experienced that the longer corporate managers work in this industry the more biased they become about how they see innovation and have hard times seizing opportunities that go beyond products that are ‘innovation pipeline’. Most of the times when it comes to innovation, the key task is adapting existing products to new markets (meaning over-marketing them) instead of developing something that is truly relevant for those specific consumers. The main drive there was leveraging economies of scale by rolling-out existing products into new markets, and gain market shares for existing brands by introducing new line extensions.
To sum up, when it comes to innovation in food, I strongly believe personal drive is the key differentiator. Companies that foster an entrepreneurial spirit, and make sure their employees have that personal drive, are the ones capable of creating meaningful innovations (Google has understood that from their very early days…).
So how to operate the switch? I strongly believe that big organizations who will be able to innovate are the ones who thoroughly understand the importance of constantly ‘contaminating’ their managers by making them working very closely to entrepreneurs and let their people ‘absorb’ a bit of that entrepreneurial and personal drive.
While startups are better suited at developing meaningful innovations for consumers, corporates have the knowledge and leverage to bring these to the market at scale. This is why at Crowdfooding we facilitate collaboration opportunities between startups and corporates, to make sure the next wave of food innovation have the best of both (startup purpose and corporate expertise and knowledge).