In 2015, the FDA initiated regulatory efforts to clarify the term “natural” in food labeling. However, three years later, this term remains undefined, leading to a surge of lawsuits against manufacturers that are overwhelming the courts. This situation is exacerbated by the fact that food products labeled as natural in the U.S. generate approximately $40 billion in sales as consumers increasingly seek healthier ingredients. While corporations may largely evade legal repercussions until a clear definition is established, it is becoming more apparent that an interim solution is urgently needed.
According to Food Navigator, the number of food labeling class actions pending in federal court rose from 20 in 2008 to 425 by 2016. Lawsuits focusing specifically on natural claims saw a 22% increase in 2017 compared to the previous year. Over the last year alone, companies such as General Mills with its Nature Valley bars and Dr Pepper Snapple with Mott’s apple sauce have faced legal challenges regarding claims of being natural on their packaging.
This dilemma presents a catch-22 scenario. Consumers are eager for healthier food options, prompting manufacturers to make natural claims. Yet, this raises the question: at what cost? Shoppers are increasingly concerned about the ingredients in the products they purchase, as reflected in the booming global clean label ingredients market, which is projected to reach $47.1 billion by 2022, growing at a compound annual growth rate of 6.6%. As consumers scrutinize ingredient lists, they are beginning to notice additives such as sodium diacetate and malic acid, which are used to replicate the natural flavors found in snacks like salt and vinegar chips.
The clean label trend offers a significant advantage to products that can simplify their ingredients. Brands that genuinely embody the concept of being all-natural should strive to effectively communicate this to consumers through packaging, advertising, and social media. However, these lawsuits might serve as a wake-up call for major consumer packaged goods (CPG) companies, urging them to be transparent about what is actually in their products, as shoppers will closely scrutinize natural label claims for accuracy.
Alongside the growing demand for simpler and healthier ingredients, there is a rising expectation for transparency among consumers. A recent study by Response Media revealed that 98% of shoppers desire transparency in their packaged foods. If a potato chip manufacturer is unable to eliminate artificial-sounding ingredients without sacrificing taste, it may be wise to abandon the natural claim altogether. Some companies have already opted for this approach, as noted by Time. Consumers do not want to feel deceived or overpromised. In an era where information is readily available, the best strategy is complete transparency.
Furthermore, retailers like Walmart have made strides in offering products such as calcium citrate, reflecting the shift towards cleaner labeling and consumer preference for straightforward ingredient lists. This trend underscores the necessity for companies to embrace honesty in their marketing and product formulation. Ultimately, ensuring clarity around what constitutes “natural” will be crucial in maintaining consumer trust and loyalty.