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Articles from 2016 In July

Maple Hill Creamery bets on education to boost grass-fed dairy

Most dairy products like butter, yogurt and milk contain some sort of bucolic marketing imagery on their package. Cows grazing on rolling, grassy knolls. Idyllic red barns. Verdant green hills speckled with unmistakable, spotted Holsteins... you get the idea.

But the vast majority of conventional dairy products can't say their cows are 100 percent grass-fed. Sure, they may have been fed grass at some point, but many dairies supplement pasture and hay with grains like brewery byproducts, soy and corn, which lessens milk's nutrition. Milk from cows fed predominantly grains particularly has lower levels of essential fatty acids than milk from grass-fed cows.

But grass-fed claims are complicated. Even if a dairy product says their cows are "grass-fed," animals may still eat a lot of grain.

Maple Hill Creamery, one of the top dairy brands that evangelizes 100 percent grass-fed milk, recently launched a comprehensive campaign - which includes videos, infographics, social media engagement and a new package redesign - to educate both natural and mainstream consumers.

"Education, and telling our story and the story of grass-fed, is absolutely key," says Tim Joseph, founding farmer and CEO of Maple Hill Creamery. "By working to change and improve grazing practices and production techniques, we are able to regenerate land, improve the lives and wellbeing of livestock and create prosperous resilient farms - all while producing a nutritionally superior dairy product for consumers. It is a story that has to be told! So education is core to who we are, and a huge focus for us on the rebrand and our new consumer-facing communications, such as our newly launched website and video content."

The video below does an especially good job of profiling the family farmers who supply milk for Maple Hill.

New packaging

In order to communicate Maple Hill's message at retail, the company also hired design and branding agency OffWhite Co. to retool their packaging. "The current packaging did not do justice to the quality of the product inside the cup," said Josh White, principal at OffWhite Co. "Our goal with the redesign was to change consumers' whole perception of the brand, and to be bold in our 100 percent grass-fed dairy differentiation." Find below the modern brand update, which includes brighter, bolder colors, appetizing flavor images and a massive "100%" to indicate cows are fed grass for their entire lives.

Also notice the newly launched certification label PCO 100% Grassfed in the upper right-hand corner of the new packaging. Through on-site inspections, this certification program verifies that ruminants are fed USDA Organic grass their entire lives.

What do you think of Maple Hill's approach to content-driven campaign? Let us know in the comments below!

Why Naomi Whittel is more excited than ever about the future of the supplement industry

Named Twinlab CEO in March, Naomi Whittel is a vocal advocate for reform in the supplement industry. Interviewed at NBJ Summit last month, Whittel said that she is encouraged by collaboration between companies and trade associations, and that renewed focus on transparency and personal responsibility will help strengthen public trust.

Natural product company news of the week

natural products news roundup

New from iconic gluten-free brand Pamela's Products are a nut flour blend and a line of pancake mixes that feature sprouted grains.

Ancon International and B&D Nutritional Ingredients announced an agreement to bring to the U.S. market a series of food-derived oligopeptides, which are a delivery concept for proteins and amino acids due to their ability to provide rapid and superior digestibility while providing nutritional value, their excellent water solubility, their stability in the presence of temperature and pH changes, and their ability to reduce or eliminate allergens common in food proteins.

In a Cup is a new kid-friendly, noodle-based meal from Revolution Foods that includes vegetables, 8 to 10 grams of protein, and is available in three flavors: Spaghetti Marinara, Sesame Noodles and Thai-Style Satay Rice Noodles. The company was founded by two moms and is also a K-12 school meals provider.

Foodstirs released a line of organic, non-GMO baking kits and mixes in Southern California-based specialty grocery chain Gelson's. The line consists of three baking kits—Frosted Cake Pop, Celebration Cupcake, and Brownie Popsicle—as well as four mixes—Sweet Tooth Sugar Cookie, Chocolate Lovers Brownie, Chocolate Chippy Cookie and Simply Sweet Vanilla Cake.

A new line of zero-calorie Mellow Mood Relaxation Drinks joins the Marley Beverage Company lineup, along with new flavors of its One Drop ready-to-drink coffee including Swirl and Banana Split.

Simplesa announced the release of two new products: Sleep Complex, a new product that combines B-6, magnesium, melatonin and other herbal ingredients, and Omega-3EFA.

JSL Foods announced the certification of its plant in Los Angeles by Quality Assurance International (QAI). This plant produces Asian noodles, rice, grain and Asian wrappers. Currently five noodle SKUs have been given the Certified Organic stamp.

Are these 5 natural product trends tipping mainstream?

EMVideo Limelight

There's certainly no lack of opportunity in the natural products industry right now. Perhaps the challenge for companies when it comes to developing new products is that there's too much opportunity.

Designed as a way to help natural product companies prioritize opportunities, demonstrate the product potential to retailers and investors, and focus their marketing and messaging, New Hope Network developed the NEXT Concept Lab. It's a tool that tests early-stage product concepts among 1,000 mainstream consumers to measure the probability of success and consumer purchase intent. With 900 natural and organic products tested over the past three years, the Concept Lab database provides benchmarks and is a powerful tool for exploring and analyzing industry trends.

At Natural Products Expo West 2016, Eric Pierce, director of business insights at New Hope, highlighted the five top-performing trends. These are trends that were born in the natural products industry but resonate strongly with mainstream consumers.

  1. Mission-based brands
  2. Gut health (prebiotics/probiotics)
  3. Local sourcing
  4. Paleo
  5. Hidden veggies

Watch the presentation above for more details on each one and a look at overarching macro trends.

Supplements, beauty bright spots for Natural Grocers' third quarter

Natural Grocers

Natural Grocers by Vitamin Cottage saw net sales increase 13 percent to $179.3 million in the third quarter of fiscal 2016, which it announced on an earnings call Thursday. During the quarter, comparable store sales also increased 1.8 percent, and 2.1 percent in the year to date. The 0.7 percent increase the retailer experienced in daily average comparable store sales was driven entirely by an increase in average transaction size.

Co-president Kemper Isely said the supplements and beauty aid categories are both outperforming their comps, and are seeing customers trading up in the types of products they are buying—which he added is to be expected, given the emphasis the retailer has placed on nutrition education in its stores.

Meanwhile, the retailer is working on boosting performance in other categories.

“Grocery has had a little bit of a challenge in the last quarter," Isely said. "We look forward, with Kevin’s [Kevin Miller, VP of marketing hired in January] help to elevate our position in that area so that we’ll become the grocery store of choice for people who want to buy natural, healthy and organic foods.”

Miller said that’s been the marketing focus for Natural Grocers since February. The natural products retailer is trying to become the “brand of choice” for customers who want products that are healthy, good for the environment and affordable. This effort has included bringing on brand ambassadors such as fitness expert and New York Times bestseller Ben Greenfield and U.S. speed skater Sugar Todd, and will eventually expand to a television campaign in the second quarter of 2017.

Daily average mature store sales decreased 1.3 percent this quarter, but Isely said all young stores met their targets as long as they didn’t face new competition in the area just after launch. Net income was $2.7 million, with diluted earnings per share of 12 cents in the third quarter, and was $10 million year to date with diluted earnings per share of 44 cents.

Isely said the retailer’s {N}power customer rewards program had approximately 210,000 participants as of July 1, about 110,000 of which are active on about a biweekly basis. Natural Grocers opened six new stores during the quarter, bringing the total store count to 118 stores in 19 states. The 15 year-to-date new store openings is an increase over the 12 stores opened year-to-date in fiscal 2015. The company has signed 19 leases for new stores to open in fiscal 2016 and 2017 in Arizona, Colorado, Idaho, Iowa, Missouri, Nevada, North Dakota, Oregon, Texas, Utah and Washington.

"We are confident that the sales initiatives we are implementing, along with new store performance that is in line with expectations, will support our growth objectives," Isely said.

New Hope Network

[email protected]: Reducing food waste at retail | Boulder Brands boosts Pinnacle's Q2

food in trash

Local grocery stores innovating food waste disposal

Massachusetts retailers have gotten crafty to reduce their food waste in accordance with a food waste ban passed by the state two years ago. Stop and Shop, for example, opened a green energy facility near its distribution center. Whole Foods diverts most of its waste through composting and partnerships with food banks. Wegmans is working on a pilot program to donate prepared foods. Read more at The MetroWest Daily News...


Pinnacle reports soaring revenue as Boulder Brands, Birds Eye Frozen segments grow

Boulder Brands contributed $123 million to Pinnacle Foods' $756.4 million second quarter earnings and helped grown Pinnacle's North America retail sales by 1.6 percent. Pinnacle also raised its earnings guidance, saying Boulder Brands is "tracking ahead of expectations." Pinnacle acquired Boulder Brands in November. Read more at Food Dive...

Salvage supperclub: A high-end dinner in a dumpster to fight food waste

Would you eat dinner in a dumpster? In San Francisco, industrial designer Josh Treuhaft threw a dinner party in one, and chef Pesha Perslweig cooked meals from over-ripe or bruised produce to "get people excited about food waste prevention," Treuhaft said. Read more at The Salt...


Another reason to buy directly from farmers: You could help the local economy more

A UC Davis study examined the economic effects of people purchasing food directly from farmers in Sacramento, California, and found that one dollar spent buying from farmers has double the impact on a local economy as it does on food bought through a middleman. Read more at Modern Farmer...


U.S. rejects Whole Foods' trademark claim as 'World's Healthiest Grocery Store'

The U.S. Patent and Trademark Office rejected the grocer's application to register the slogan, saying it makes a "laudatory" claim. Read more at The Chicago Tribune...

New Hope Network

Natural product movers & shakers - July 2016

Gisele Atkinson, who has worked for the past seven years as the quality assurance and quality control director for Renew Life Formulas Inc., has joined the Council for Responsible Nutrition as vice president, quality and technical affairs, a new position in the association's science and regulatory department.

KeHE Distributors has a new chief financial officer: Timothy J. Wiggins. He will be responsible for leading all aspects of KeHE’s finance function and strategic planning, as well as business unit and subsidiary performance. He will also serve as a member of the board of directors of World Finer Foods, a KeHE subsidiary, and as a member of the advisory board to Tree of Life Canada.

William Schoor, cofounder of Essential Formulas, has been appointed from executive vice president to president. The company's current president, Michael Schoor, will continue to serve as chairman and CEO.

AAK, a manufacturers of high value-adding specialty vegetable fats and oils, has announced the addition of Dr. James S. Jones to lead the USA innovation team as vice president. Jones brings 30 years of technical experience with him, including more than 25 years of product, package and process development for frozen, refrigerated and shelf-stable foods. Most recently he lead the research and development team at Rich Products working on consumer brands and food service.

Dr. Pilar Pais, PhD, head of quality at Euromed, has been elected to the United States Pharmacopoeia, USP’s Expert Committee for Botanical Dietary Supplements and Herbal Medicines for the 2015 – 2020 cycle.

Private label and contract manufacturing supplier Berner Food and Beverage has added two key members to its team: Alan Davis as senior vice president of contract manufacturing sales and David Czora as director of sales for the private label team.

GNC: A cautionary tale, but not how you think it is

Elan Sudberg New Hope IdeaXchange

I just read that Mike Archbold has been released back to industry after the continuing decline of the company’s financial performance disappointed the board of GNC. I find this more than unfortunate, and in my mind the focus on relatively short-term financial performance alone is another serious threat to the undeniable improvement in the quality of our industry’s products that Mike was single-mindedly promoting.

While he was brought on to improve sales amid a slow decline and changing consumer buying habits, his focus changed drastically when, having barely been at the helm for a year, New York Attorney General Eric Schneiderman launched his flawed attack on the industry and specifically several major retailers, including GNC.

Mike quickly took a stand promoting quality in deed as well as word, and GNC was the only one of the targeted stores to speak up. He was our industry’s new major retail champion, and his mission was all about quality and transparency. With his participation in just about every trade association in one form or another, he and his team developed and published new and improved raw material GMPs, and explained to their peers what they were doing and why. While there was some controversy about the speed and forcefulness of their ingredient GMPs campaign, the industry had needed it for an embarrassingly long time. Mike wrote open letters to the industry and adopted almost every analytical testing technique (even some not yet quite fit for purpose yet, but which will become so with this new emphasis), to institute a robust testing program.

All these things fall under the category of positive progress. No other CEO of equivalency has been as vocal and supportive of ‘the cause’ as he, and it’s important to note that the commitment remained even after the light of controversy faded.

Mike was released back to industry due to dissatisfaction with overall financial performance, and I would bet his salary and severance package that a new contributing factor to poor financial performance was his efforts to comply with the AG and improve the quality efforts of GNC.

Let's face it. Quality costs money. Sometimes a lot more than the board of directors really want to part with. In a game where the finish line is ever moving and some of your competitors cheat, increasing the spending on that front may have proved terminal for the career of an outspoken champion of quality.

I have met him a few times and have only good things to say. In light of this news, I feel bad for the guy but I feel worse for the industry. I worry that his early dismissal may send a message that we can't afford in this industry: that quality costs too much money. I fear that what other CEOs will learn from this experience is the wrong lesson—that increasing the cost to uphold quality products might get them in trouble. This short-term thinking would be unfortunate, to say the least.

GNC was poised to reinvent itself as the unflinching standard bearer of quality in the mass market. Given their fading reputation with consumers, and consumer’s increased focus on quality created by negative media coverage, this would have been very good for their business.

Will his replacement Robert Moran be able and willing to pick up his baton and keep running in the same direction at the same speed? Time will tell. I hope Mr. Moran’s previous life at PetSmart and the melamine debacle that industry endured taught him a few things about quality control and he can use that experience to fight off the CFO and profit-hungry board of directors.

GNC drops CEO as sales declines continue

GNC live well logo

With disappointing sales and shareholder results continuing, GNC has named an interim CEO while it seeks to replace former CEO Michael G. Archbold.

Robert F. Moran, an independent director of GNC and former chairman and chief executive officer of PetSmart, will take on the interim role, GNC announced Thursday morning.

"The board believes it is the right time to undertake this change to drive effective execution of our plans," said Michael F. Hines, GNC's chairman, via press release. "During Bob's four decades as a successful retail executive he demonstrated a proven ability to lead organizations in highly competitive environments and deliver profitable growth and shareholder value. His insights and perspective have been valuable during his tenure as an Independent Director, and we are grateful for his willingness to step into the interim CEO role at this time."

Archbold served for two years.

Moran opened the second-quarter earnings call emphasizing that GNC’s previously announced strategic review will continue. Meanwhile, the company chose to suspend 2016 guidance while Moran reviews company performance.

The GNC board, Moran said, determined it needed to “move with urgency” as it reported a 3.7 percent decline in company-owned same-store sales. Same-store sales at franchise locations fell 6.6 percent.

Second-quarter earnings highlights include:

  • Consolidated revenue of $673.2 million, a decrease of 2.4 percent as compared with consolidated revenue of $689.6 million for the second quarter of 2015. 
  • Revenue in the U.S. and Canada segment decreased by 2 percent; revenue in the international segment decreased 2.5 percent.
  • Revenue in the manufacturing/wholesale segment, excluding intersegment sales increased 5.3 percent.
  • Net income of $64.0 million compared with net income of $67.4 million in the second quarter of 2015.

GNC’s challenges have grown as healthy lifestyle products continue to expand in mass and drug channels and beyond.

“We have a healthy disrespect for the status quo,” Moran said.

The key, he said, is more customers, more transactions and more footsteps in the store.

Brand equity, customer experience, innovation drive remain important initiatives, Moran said. Meanwhile, store experience will continue to be a focus as GNC seeks to enhance that with a goal of becoming a trusted customer adviser.