Pearlfisher design came to us and said, 'We love your chocolate, but your packaging... ugh!' Craig Sams
Craig Sams, Founder and President of Green & Black's and Co-founder and Executive Chairman of Carbon Gold gives a potted history of his 40 year career at the leading edge of the organic foods sector, shares his predictions for the future of farming and reminds the Redesigning Business Summit audience how design helps Green & Black's to differentiate itself in an ever-crowded marketplace.
Read the transcript below.
Craig Sams, Founder and President, Green & Black's
Well what I’d like to do today is take a look backwards. To look at some of the seeds of what we now have been discussing about sustainability and these other things, and use some of that as a reference point to take a a peek forwards and look at some of the things I think are going to be important – or as important – in the future, as we thought those things were in the past.
Looking backwards at how examples of design adapted to emerging circumstances and how it helped sometimes to drive changes in people’s thinking and sometimes to reflect it. I think that part of the fascination of packaging is the degree to which it actually gives you the feel of history and reflects the realities of everyday life and changes in popular consciousness. So I’ll use a lot of examples from my own experience, because many of these were marginal or niche examples that have now moved firmly into the mainstream since the 1960s. And for a moment I’ll even trawl further back to explore the roots of some of the trends that are now central issues.
I was born on a farm in Nebraska in 1944. At that time unsustainable and environmentally damaging farming practices had created the Dust Bowl. Every year in the summer, large parts of Nebraska, Kansas and Oklahoma would just blow up in the air and swamp – wherever it came down – swamped houses; destroyed millions of hectares of good farmland; created 250,000 American refugees (made famous in John Steinbeck’s book, Grapes of Wrath) who emigrated to California, Detroit – somewhere where they weren’t just surrounded by unfarmable dry dust.
That was an early harbinger of man made climate change. Farmers in the mid-west, even if they survived that, suffered financially. My mother didn’t get her first store-bought dress until her 16th birthday. But flour millers were quick to exploit the opportunity and they made flour bags printed with pretty calico prints and competed on the shelf selling flour that was then converted into dresses. And I don’t know if the underwear guy is here, but there may be an idea for you with this. So that’s my mom and her sister in calico prints that look uncannily similar to the Melrose Flour print.
In Britain the Soil Association was formed to ensure that the Dust Bowl experience wouldn’t be repeated here. Tractors and chemical fertilisers were already beginning to lead to environmental deterioration. It was founded by Lady Eve Balfour in 1946. It never really – in the early days – managed to commercialise organic food or give it separate branding, but it did serve as a refuge for farmers who recognised and feared the dangers of industrial farming. They enjoyed few markets for their produce, but soldiered on in a system where subsidies on fertiliser insured that maximisation was always going to be more profitable than optimisation.
And her co-founder was someone – Doctor Innes Pearce – whose Peckham Project had shown the poor families in Peckham, South London, if they were shown how to prepare healthy meals and improve standards of domestic hygiene, showed real improvements in education, marital stability and employment. So the Soil Association was a marriage of healthy farming and healthy lifestyle. I joined in 1967.
My brother and I opened a macrobiotic restaurant in Notting Hill which we called, Seed. We called it Seed because we saw macrobiotics as the germ of a new way of eating and living. It was the first place in Britain where you could actually get a meal made with organic food. And macrobiotics laid the foundations for the natural food movement. It was a holistic approach to eating, based on the Yin and Yang philosophy – and I noticed the speaker from Samsung talked about balancing reason and emotion, and that’s a very Yin and Yang thing. The Korean flag is actually the Yin Yang sign, so it would be natural to be the inherent philosophy of a Korean company.
And it was responsible for a lot of things. It introduced whole grains such as brown rice, which had never been on sale in Britain before. It had the overriding concept of justice – so fairness for people and for animals; for the idea that food was the foundation of health; for the first appearance in Britain of now familiar Japanese foods like miso, soya sauce and sushi. And for an unequivocal commitment to organic food, for avoiding sugary foods and for avoiding surgery and prescription drugs.
At the time it seemed extremely radical and weird. Doctors hated it and the American Medical Association took quite a heavy pop at it, saying that it could lead to death. Of course any diet can lead to death and you know, I’ve been macrobiotic for 45 years and I can guarantee you I am closer to death now than I was then.
However, on the other side, celebrities like John Lennon and Terence Stamp loved it. They were regulars at the restaurant. John Lennon gave my brother a little cartoon in gratitude for turning him on to brown rice. So you can guess whose lead young groovers in the '60s were more likely to follow. To propagate the message further, I wrote a book that sold 300,000 copies globally. We had to teach people why they wanted our products – education, education, education. And we also published a magazine until 1977 that was read by dropouts, spiritual seekers, radical traditionalists and back-to-the-land enthusiasts, the Seed Magazine.
But making the food available in shops was what helped to turn theory into practice. This was the first consumer pack of organic food in Britain. Our logo communicated macrobiotic values with Yin and Yang as the philosophical foundation of the diet, with root and branch imagery. By the end of the '70s we were called The Brown Rice Barons, because we dominated the brown rice market and that’s when Tilda and Uncle Ben came after us. Sadly, they beat the crap out of us within a year or two and we lost out completely. Brown rice had become a commodity and a sort of add-on to a white rice range which of course we abhorred.
So I kind of like to avoid competition. I prefer to define a niche then promote it, then occupy it, then defend it as best I can against all comers. What you’d call first-mover advantage. We got to number two after Nestlé’s Sun Pat brand with peanut butter in the 1980s; and it was during my search for organic peanuts that I found farmers in Togo who were producing organic cocoa. So like Steve Jobs – who looks in the mirror and says, 'What shall we invent today?' at Apple – I looked in my cupboard and said, 'What would I like to see in here that I haven’t got?' And the answer was chocolate. And chocolate with a very low sugar content, because being macrobiotic I shouldn’t really be touching it at all.
We had a sample made into 70% solid chocolate and this led to Green & Black's organic chocolate – now the worlds leading brand of organic chocolate. It was the first chocolate that had a cocoa solid statement on the front of the pack. It was the first organic chocolate and it was the first chocolate that described its origins transparently and identified the people who actually grew the beans that went into it.
In 1994 it was the first product ever to qualify for the Fairtrade mark. It was our macrobiotic principles of justice what done it, but the Fairtrade movement latched on and propelled us to even greater sales. We created Maya Gold, which became the template for Fairtrade deals and has been replicated all over the world since. It was launched on Maya Gold, but within a year the mark was on bananas, sugar, coffee and tea. Our success owed a great deal to independent third party verification, and I’ll come back to that. Both the Soil Association and Fairtrade – but it always is important to have a good product too – now has a 10% share of the total block chocolate market in UK and is leading organic chocolate in the US and Australia.
And things have changed since its launch in 1991. Then you had to explain to people in painful detail what organic meant. Now 78% British consumers can define it accurately and the market has continued to grow. If you go back to 1974 it was 3 million, it’s now over 2 billion. That represents 30% year-on-year growth. Last year it stalled, like everything else, and fell 17%, but it’s already back to its 2008 level and growing at more than 10%.
So what are the factors that drive this relentless growth? Health, obviously; As people recognise the effects on gender cancer, degenerative disease, of bad diet, hydrogenated fats, pesticide residues and artificial additives, more people will adopt organic food. Biodiversity; people care more and more about the environment. Genetic engineering; recently Mark Price, the CEO of Waitrose suggested to me that, as it becomes more and more impossible to keep genetically modified food out of the food chain, organic food will be the only refuge left for people who want to avoid eating this untested and environmentally dangerous food. And climate change; and here the message is coming through big time, and this is now working through to consumer level.
Green & Black's is now bigger than Marmite in sales. It’s the coolest food brand, according to the CoolBrands panel and has been for four years running. That, by the way, is the... where we pushed all four of the organic messages, if you like, together. One was organic across the top, wholegrain pushing the health message, No GMOs. That was the year after they were introduced; we were the first people to put No GMOs on a product pack. And it was the first product to claim to be carbon neutral. We had the carbon footprint analysed, discovered that because it was organic it had a much lower carbon footprint than non-organic corn and Future Forest, who became the carbon neutral company, planted trees to balance the excess of carbon.
But our design was always evolutionary, however revolutionary our attitudes might have been. So that was my first... just when we had the Green & Black's idea. I went downstairs and printed out a quick dot matrix printer image which became the bar at the top. Then we went to Pearlfisher design who were just starting out. Well actually, Pearlfisher design came to us and said, 'We love your chocolate, but you packaging... ugh!' – and came up with a modification of the design that has never really changed too dramatically so that it’s brought our customers with us all the way along. We still make them pitch every three or four years for our account, but they always get it, because they get it.
And organic in general... Green & Black's is now bigger than Marmite, and it’s the coolest food brand according to the CoolBrands panel. Cooler than Prada, though not as cool as Aston Martin, but I think that was a temporary blip due to Daniel Craig, my namesake.
Cool says a lot. We worked this into an advertorial with Glamour Magazine with the milk chocolate skinned chocolate lover on the first page with a bar of Green & Black's. Then inside, something that is almost impossible to conceive, you’ve got Stella McCartney and Sienna Miller, for glamour and celebrity; you have Sol Gartier and Ignacio Ash, two of the thousands of farmers who supply us with fairly traded cocoa. And then, a madly indulgent recipe for a gold dusted chocolate mousse cake. Now you know, uneasy bedfellows, but actually it fits perfectly and on the back, the organic... the Glamour girl diary; a week in the life of a typical Glamour reader, with all the groovy occasions where Green & Black's can help enhance a charmed life.
The Fairtrade story is a hard one to tell. Seeing its benefits sometimes can bring tears to your eyes, but telling others about it can too easily sound self-inflating. But the stories sound, through and through. So when the Observer Food monthly’s, Andrew Purvis went to Belize, he went wherever he wanted. He stayed in a village overnight, he met the farmers and their families and his rendition of the story was better than anything we could have said ourselves.
We’ve just launched the new colour wave redesign of the range. Pearlfisher came up trumps again and its on-shelf impact ensures that it’s stocked at eye level in most outlets. If shelf candy is the retail equivalent of arm candy, this is the hot stuff. And Peter Blake, the artist who designed the Sergeant Pepper cover, made a collage with the bars that was the star of the show at a recent art barter event at a trendy art gallery in Brick Lane.
But now I want to talk about climate change and carbon and what’s that going to do to the future of food and what the impact will be. Agriculture is responsible for 30% of our greenhouse gas emissions annually and to date it has been excluded from carbon offsets and carbon trading or carbon tax. Now the carbon markets and politicians and probably most importantly, American farmers, realise that this represents a big lost opportunity. Copenhagen disappointed some, but there was an important agreement between the US, China, India, Brazil and South Africa that will change the way we farm in future. They agreed, what’s called read, that solid carbon and forest carbon will be included in any future climate settlement. The EU endorsed this agreement as well.
So what are the implications of this? Modern farming is about eating oil, it’s about turning hydrocarbons into carbohydrates. It takes 12 calories of fossil fuel to produce one calorie of food. Even organic farmers use five calories to produce one calorie of food. A peasant with a hoe uses one calorie to produce 20 calories of food. As long as we don’t count the real cost of hydrocarbon inputs – i.e. fossil fuel inputs – into our farming, we’ll never be able to put the right price on carbohydrate outputs. We need to put a price on carbon in as well as carbon out.
So what would happen if carbon was properly priced and emissions from agriculture were taxed or sequestration and storage was rewarded? When my great grandfather first ploughed the virgin prairies of Nebraska his land contained 50 tons of carbon per hectare, now it contains five. The rest is in the sky contributing to global warming. An organic farmer can add nearly a ton per hectare of carbon to the soil per year. An industrial farmer can lose a ton a year of the carbon dioxide equivalent. Much of it is nitrous oxide from nitrate fertilisers.
If the price of carbon is €70 a ton, which is the least it will be in 2013, the organic farmer will gain about €70 per hectare per year and the non-organic farmer may have to pay an equivalent amount as a tax or offset. That’s a net difference of 140. In addition farmers will be rewarded for the overall level of carbon in their soil. In the same way the saver is rewarded with interest on the money that they have in a bank account. So for an organic farmer with 50 tons of carbon per hectare – 3,500 worth of carbon in effect – 2% interest would be another €70 per annum. So there’s a potential differential – and this is totally theoretical – of €210 per hectare per annum if you brought carbon accounting into agriculture.
St. Nicholas Stern has called for a universal and equitable carbon trading system. If we have that then those kind of factors will come into play and I look forward to a day when only the very rich will be able to afford non-organic food. Are you going to give me another couple of minutes, because I did start late? But I’ll gallop now. Biochar is a way to even accelerate carbon sequestration in soil. Instead of burning a rotting biomass, if you turn it into biochar, a form of charcoal, and put it in the soil, it stays there for 1,000 years on average. It helps soil to retain moisture, reduce the need for fertiliser and encourages microbiological life in the soil.
We heard about Riverford Farms, they’re doing trials with biochar with carbon coal this year, with organic vegetables that they deliver to people’s homes, so that next year they’ll be able to roll it out and tell their customers that their vegetables are carbon neutral and address any issues about home delivery and that sort of thing. And gardeners will soon be able to buy it at their local garden centres and start to capture carbon in their gardens. The Food for Life partnership I’m going to skip over, but it’s a Soil Association programme that now has 350,000 kids in Britain eating an organic school dinner every day and that’s in conjunction with Food Campaign and Garden Organic.
And the last point I want to make is certification. All the aspiration in the world and all of the statements that a manufacturer can make to their customers always meets with the Mandy Rice Davis response, 'Well they would say that, wouldn’t they?' We need certification to guarantee to the customer that an independent trusted third party has authenticated and verified what you do. You know, we know we’re doing right, but having the Soil Association or Fair Trade on the packet is important. If you’re Nestlé or Cadbury it’s even more important, which is why Kit Kat bars are now Fair Trade. And third party certification covers different categories, but is founded on the basic principals – sustainable, fair, good for you, good for the planet.
Now organic has a plethora of different certifying symbols which is something that needs to be addressed because it’s confusing – it’s not universal. But unfortunately, organic regulation is controlled by the government and they’ve sort of created this situation. Organic textiles are not... and there’s one emerging symbol that will be the universal symbol and the same applies to cosmetics. Slow Food, Fair Trade, Forestry Stewardship Council, Marine Stewardship Council have all got one global symbol for one global standard and they’re all based on the same principles, which in slow food sums it up best; good, clean and fair. And there was a certain inevitability to the convergence of all these different standards and the organic movement needs to get its own global logo. But ultimately, I would like to see one universal assurance standard and symbol that covers all the major Fs: Food, farming, fish, forestry, fair trade and a future for our grandchildren. One symbol that harmonises it all. How about harmony? – which is where I began. Thank you.
Vijay Vaitheeswaran, Correspondent, The Economist
You gave us a litany of Fs, let me add one more – fantastic! I think your history of success in business of course... I’m brimming with questions, but I’m very mindful that our time is short, so why don’t I actually bite my tongue and offer the time to questions from the audience if there are any. If not, I certainly don’t intend to let this time pass. So do we have any questions, hands up? If not, you can percolate while I ask my first question?
You’ve had tremendous success and you talked about first-mover advantage; getting in there quickly, defending your corner – establishing. And in the past you’ve talked about niches in differentiation as sort of ideas that are important. Can you talk to me about the trade-off? The bigger you get the further you go, for example; the more success you have, does it inevitably mean a decline in the success of what you’re trying to do? Things come to mind; Iceland were very early with organic, the market wasn’t ready. When Wal-Mart was trying to move into this area we saw the huge backlash, 'Oh no, not Wal-Mart! If Wal-Mart does organic it must be evil or it will cheapen the brand inevitably.' So is there a tension between a great idea that’s a niche and a great idea that goes mass market and becomes commoditised?
Craig Sams, Founder and President, Green & Black's
Well first of all, if you want me to talk about my failures I need a couple of hours, but you know, I think generally niche things tend to start out... there’s a sort of tendency to be exclusive. Macrobiotics suffered from just that; oh, you know, that person ate bananas or tomatoes or something, they’re not macrobiotic. It kind of, you know, people tend, you know, churches do it a lot, religions... all religions do it and all sort of cults and sort of minority thinking does it and it’s getting over that; getting over the fact that Wal-Mart has told all its fish suppliers that they have to be MSC certified. You know, that’s not a bad thing. It is not bad that more farmers are growing organic cocoa or organic corn or anything else. You know, that’s... The battle is at the sort of field level and the fishing level or whatever and anything that expands the market has got to be beneficial.
Vijay Vaitheeswaran, Correspondent, The Economist
Even if the evil empire are getting involved?
Craig Sams, Founder and President, Green & Black's
Even if the evil empire are getting involved and there’s a debate at the Natural Organic Product show in a couple of weeks – I’m rehearsed for this already – that is basically where the natural food and organic shops are saying, 'Should we be stocking Kraft, Unilever, Coca-Cola, Innocent or Pret a Manger etc. etc.' So it’s getting out of a niche sometimes is a little bit painful, but it has to be done.
Vijay Vaitheeswaran, Correspondent, The Economist
So you take a pragmatist view, it sounds like, about this. Again, last chance for a quick question from the audience before we wind things up today. Yes, there’s a gentleman right in the front. Please let’s get a microphone.
Jonathan Ford, Pearlfisher
Don’t worry this is not a plug for Pearlfisher!
Craig, having worked with you from the very beginning and seeing that success, I’ve seen it go from Cadbury's and now into Kraft, so it’s a build on the question that we were just talking about. In your mind, when you see large corporations effectively buy an ethical brand, do you think that is a good thing in the long-term, that that is effectively what is happening, that they are buying those ethics, effectively, and that they’re going to make a change or what else...? What is your view on ethical brands as they get absorbed by larger corporations?
Craig Sams, Founder and President, Green & Black's
Well, Cadbury's will stoutly deny that absorbing Green & Black's had anything to do with them taking Dairy Milk fair trade, but at some level it became okay. It kind of gave them permission at board level to talk about stuff that somebody would have been fired for possibly, ten or 15 years ago; 'Hey why don’t we pay more for our cocoa so that the farmers can be better off?' – you know?
So I think that’s the big change and it’s very difficult though, for a company like that to start and initiate that process to do it. So it’s much easier to buy a company that’s already done it and you know there are lots of other examples of that. But there is always the danger, you know, when you’re in bed with an elephant, if it rolls over you know, it can very easily crush you. We were very lucky with Cadbury's that we had Todd Stitzer, the CEOs, ear. So there’s a couple of times when that great, grey hulk nearly crushed us, we could shout and he’d pull back the corporate machinery that just unthinkingly looks... well, we’ve got to save money, we’ve got to do this... One way we can do this is to integrate this to the rest of the business, because we’ve already got sales, marketing etc. And I think that’s the danger again with Kraft and we’ll just have to be really prickly to make sure it doesn’t happen.
Vijay Vaitheeswaran, Correspondent, The Economist
Great, I think I will draw to a close there Craig. But thank you very much. I think you’ll all join me in wishing you well.