Brand Britain: promoting British food and drink Contents

2International markets

Consumer perceptions of British food and drink

19.The UK exports agricultural commodities, but the Food and Drink Federation’s (FDF) export statistics show that in 2018, the top five UK food and drink products exported (by value) were whisky, chocolate, cheese, salmon and wine.45 The FDF stated that “the quality, trust, heritage and innovation of our food and drink products are all major strengths, and resonate with middle class consumers in rapidly developing countries, where food and drink is typically the entry point for those seeking a more westernised lifestyle”.46 However, “British origin products are still very niche”.47 The AHDB reported that “general awareness of British food is fairly low” in overseas markets, highlighting “the necessity for exposure to products and clear branding to drive awareness and build brand reputation”.48

20.The AHDB’s April 2018 report on International Consumer Buying Behaviour stated that “we cannot simply rely on the Union flag and Big Ben to ‘sell’ British produce in a complex and fragmented series of consumer markets”.49 AHDB consumer research in 2017 asked “what was most important to consumers when choosing the food they purchase” (see Figure 1).50

Figure 1: The two most common priorities when choosing food51

In seven out of the nine countries surveyed, “quality” was the most important factor, but for China and Japan, “food safety” was the first and second priority respectively.52 The AHDB attributed this to recent food safety scares in China and food contamination concerns following the Fukushima nuclear incident in Japan.53 As with British consumers, there are differing views on what constitutes “quality”, and this also varies by food category.54 For example, German consumers judge the quality of meat by appearance, taste and origin, whereas for Indian consumers, meat quality was judged by health benefit, food safety and expiration date.55 The British Meat Processors Association (BMPA) stated that because quality means different things in different countries, “messaging needs to be tailored accordingly”.56 The BMPA added that the British “have a reputation for stringent regulation and high standards and these may well be more effective attributes to promote in many markets”.57 This is because “responsible food supply chains are highly valued overseas and very important to satisfy food safety concerns in countries such as China and Japan”.58

21.The FDF has submitted a Sector Deal proposal to the Department for Business, Energy and Industrial Strategy (BEIS) for negotiation.59 It proposed the establishment of a “Market Research Unit that produces market and sector intelligence reports […] to support export prioritisation”.60 The FDF stated that “there is market failure in the provision of market research to support export prioritisation” and that “large food and drink businesses gamble on new markets as it is cheaper to fail than to pay for research”.61 We asked Phil Hadley, International Market Development Director at the AHDB, whether the proposed market research unit suggested a failure in AHDB’s market intelligence efforts and he told us that AHDB’s “market intelligence work has been domestic focused” and that this had been successful in tracking UK consumer trends and buying patterns.62 He added that:

If the question is about whether it has failed in the international market, it is only in the last 12 or 18 months that we have begun to cast the net a little wider, recognising there are gaps on the international front that we could learn more about and, therefore, tailor our international work more effectively. […] It is a new stream of work for us, so I do not think it is a failure, but we recognise it is a gap that was not being filled that we should.63

22.We launched this inquiry to explore what work could be done to promote British products overseas, as well as to consolidate the domestic market. Quality Meat Scotland noted that “GB plc brand tends to be positively recognised in some former Empire/Commonwealth nations but less in other countries”.64 In the tourism sector, marketing has been developed in a manner that recognises national and regional identities under overarching British branding, through the tourism boards VisitBritain, VisitEngland, VisitScotland and Visit Wales.65

23.Research suggests that awareness of British food and drink is low in international markets. This provides an opportunity for improvement, particularly if promotion is tailored to the values of each market, for example emphasising the safety of British food in China. More research should be done into some overseas markets to work out the best way to promote British products overseas and ensure greater exposure to British food.

24.International market research to support exports is lacking, and this has been recognised by the Agriculture and Horticulture Development Board (AHDB) and industry. We commend the efforts of the AHDB in increasing its focus on international market intelligence and support the Food and Drink Federation’s (FDF) proposed market research unit. Because the AHDB and FDF support different parts of the food and drink industry, these efforts should be complementary. However, this should not be taken as a given and it would be useful for businesses if market research was coordinated. The Government and AHDB must work closely with the FDF to develop and support the new market research unit. The market research unit ought to provide insights to enable the Government and exporting businesses to promote and market British products more effectively.

25.More should be done to increase overseas consumer exposure to British food and drink. We recognise that this needs to be done sensitively and in a way that enables nations of the UK to retain their separate identities - as has been done with the tourist boards, VisitBritain, VisitEngland, VisitScotland and Visit Wales.

Food is GREAT campaign

26.In October 2016, Defra published the UK Food and Drink - International Action Plan 2016–2020 (IAP).66 The IAP detailed “the activities which both Government and industry are committed to delivering over the next five years in order to accelerate UK export growth and boost the confidence and ambition of those wishing to export”.67 The Government’s ambition was to raise “the value of UK exports by an additional £2.9 billion” over the five years, from £20.1 billion in 2016 to £23 billion in 2020.68 The nine priority markets were: Australia and New Zealand; Mexico and Latin America; France; Germany; India; Japan; USA and Canada, China; and UAE and Gulf.69 Despite these ambitions, the FDF told us that “only 50 per cent of active food and drink exporters were aware of this plan”.70

27.In 2017, “Defra, working in collaboration with the Department for International Trade (DIT), VisitBritain and the Foreign and Commonwealth Office (FCO), developed the stand-alone Food is GREAT campaign to underpin the IAP and raise the profile of the UK’s excellent food and drink exports”.71 Defra explained that “the campaign had a budget of £1.25m in 2017/18, rising to £1.5m in 2018/9”.72 Focusing on China and the USA in its first year, the main objectives of the Food is GREAT Campaign were to:

a)Build global demand for UK food and drink among international businesses in key markets;

b)Build global awareness and demand for UK food and drink among international consumers in key markets; and

c)Increase export ambition among UK food and drink businesses.73

Activities included the development of a “Food is GREAT hospitality toolkit which is shared with the British embassy network worldwide”, working “with public and private stakeholders to promote UK produce overseas” and the use of “high-impact content and materials to promote UK food and drink internationally”, including films and infographics.74

28.Dairy UK considered that “the Government needs to project a clear brand image of UK food and drink as a whole” and the GREAT campaign “provides a useful foundation from which companies can promote their own individual brands”.75 Sandra Sullivan from the Food and Drink Exporters Association (FDEA) explained that its members “typically are companies that are exporting branded products” which “would be sold into multiple retailers in a high quality premium market”, making it “really important that there is promotion in those markets to raise awareness of Britain and to sell our qualities”.76 She considered that “things like the GREAT campaign are very good at getting general awareness of Britain out there” but added that “what we have to do within the food industry is to make sure that we are really pushing the quality, the safety and the traceability of our food so that we become first choice for a lot of these markets as they become more affluent”.77 The Provision Trade Federation, an industry body representing processors and traders in a range of staple dairy, meat and fishery products, stated that the campaign:

does provide an effective vehicle for promoting generic British foods and drink though it should only be utilised when it is appropriate to increase confidence in British produce. Generic marketing will never replace targeted marketing, branding and advertising and as such this campaign will only ever raise general awareness rather than increase specific sales. The responsibility for this lies with commercial companies.78

29.We asked Graham Stuart MP, Minister for Investment at the Department for International Trade (DIT), whether the Government would meet its ambitions to increase food exports by £2.9 billion by 2020, from £20.1 billion in 2016 to £23 billion 2020.79 He stated that “we are at £22.5 billion, I think, in the latest numbers”.80 He added that “food and drink is one of the areas where there is the greatest potential” but “it is fragmented and it is dominated by SMEs, which creates barriers”.81 Export support for SMEs is addressed in the next chapter.

30.We are satisfied that the Government is on track to meet its target to increase food exports to £23 billion by 2020. However, £23 billion was a modest target. The UK Food and Drink International Action Plan (IAP) 2016–2020 should be reviewed and updated immediately, with a new plan published for 2021–2025. We consider that a key focus of the next IAP should be on improving export activities of SMEs. The next IAP should be accompanied by a more ambitious target for the value of food exports.

Assurance schemes

31.We were interested in the role of assurance schemes, such as Red Tractor, in marketing and promoting British food abroad. Phil Hadley, International Market Development Director, AHDB, pointed out that Red Tractor “has been a domestic marketing tool”.82 It is therefore unsurprising that “foreign markets are unfamiliar with the Red Tractor as a brand and the concept of an assurance scheme is not widely understood”.83 However, the NFU considered that “both organic dairy and Red Tractor dairy resonate with consumers in third countries” and that “Red Tractor independent assurance is a strong asset in China, for example, where there is big appetite for fresh dairy products”.84 Dairy UK cautioned that “care has to be taken to ensure that Red Tractor standards are sufficiently high to be promoted in certain markets” that might have “comparable or even higher standards”.85 Ray Smith, Agriculture, Food and Drink Counsellor, British Embassy Beijing, stated that:

There is definitely space for a standard that the Chinese would see as being a recognised standard for safety. Whether that is Red Tractor is a wider question. I do not think Red Tractor is currently known in China and you may be better off working with Chinese authorities to create a standard that fits with what China is looking for on food safety, and then bringing that in as a new standard, which is introduced with a logo that is recognised for China and resonates with China.86

32.Phil Hadley was concerned that “one single logo across the globe might not achieve maximum objectives in multiple individual countries” and suggested that “if the decision were made for Red Tractor to move towards more international markets, they would have to pick the markets in which they wanted to be present [and] road test some mock-ups of what a logo would look like to see if it had presence”.87

33.Defra told us last year that it had “started exploring what a Gold Standard for food and farming quality might deliver, including how it could acknowledge the full range of assurance schemes available to producers and consumers to meet their needs”.88 It added that “a key area of this work will be looking at how the standard can drive exports to new markets”.89 The Food Minister explained that:

there are multiple layers in which people want to look at assurance and look at labelling. What we are doing is carrying out some work to try to create an architecture or a framework with common metrics, so that can then either provide focus for something that we take forward within Defra or, more likely, we can use working in collaboration with existing or new assurance schemes with other third parties and other stakeholders, to create a more joined-up landscape of assurance. This is a very important and in-depth piece of work about trying to get to grips with what those metrics should be.90

34.The Food Minister praised Red Tractor for standing “high in international benchmarking and […] setting world-leading standards” but was non-committal over Red Tractor’s potential role in the Government’s wider export strategy.91

35.Red Tractor appears to be working well as a domestic assurance scheme, but consideration needs to be given to whether this assurance scheme could be used to promote British products overseas. The Government should explore a variety of different options to effectively promote British food and drink overseas. A “one size fits all” approach will not work across different countries.

36.Defra told us a year ago that it was working on a “gold standard” for food and farming quality. Although Brexit preparations have understandably delayed much of Defra’s work, we are nonetheless disappointed that little progress appears to have been made on this, given the importance of increasing UK exports to the Government’s economic and trade strategy post-Brexit. The current deadline for EU Exit is 31 October. By December 2019, Defra should provide us with a detailed update on the development of the “gold standard” including what metrics it would be based on. We would like to see greater collaboration between Defra, AHDB, Red Tractor, other assurance schemes and other food and drink organisations to promote British products overseas.

Geographical Indications

37.Geographical Indications (GIs) are used to identify a product as originating in the territory of a particular country, region or locality where its quality, reputation or other characteristic is linked to its geographical origin.92 The AHDB stated that “agricultural producers in the EU can use Geographical Indications (GIs) to try to differentiate their products in domestic and international markets to help improve their competitiveness and profitability” and that “once registered at European level, a named food or drink originating either from the EU or outside the EU will be given legal protection against imitation throughout the EU”.93 The AHDB explained that the three protected schemes are:

a)Protected Designation of Origin (PDO), which must be produced, processed and prepared in one defined area and have distinct characteristics from this area (for example, the distinctive taste of Stilton Cheese is attributed to the climatic and geographical conditions of a defined area in the East Midlands94);

b)Protected Geographical Indication (PGI), for example West Country Beef and West Country Lamb PGIs, which identifies a product originating in a specific place, region or country; and

c)Traditional Speciality Guaranteed (TSG), for example Traditionally Farmed Gloucestershire Old Spot Pork TSG. TSG refers to a specific product or foodstuff that results from a mode of production, processing or composition corresponding to traditional practice.95

The UK currently has over 80 registered products under the protected food name scheme.96

38.The FDEA stated that “PGI’s and PDO’s are not well understood by the majority of UK consumers other than by a certain group of knowledgeable consumers where they are both understood and valued” but “they are recognised by many consumers in EU markets where the marks are much more widely used”.97 The NFU agreed that “they are generally more prevalent and familiar to consumers overseas, especially in mainland Europe”.98 Hybu Cig Cymru (Meat Promotion Wales) highlighted the price premium whereby “products carrying a Protected Food Name/ Geographical Indication designation were sold in the EU at a price 2.23 times higher than products not carrying such designations”.99 In contrast, for UK consumers, “while some evidence suggests consumers consider origin labelling, other factors such as price and product quality are known to have a greater impact on consumer purchasing decisions” (see previous chapter for more).100

39.Scotch whisky is the UK’s biggest export in the food and drink category.101 The Scotch Whisky Association considered it “vital that in time for the UK’s exit from the EU, a framework for GIs has been established”, adding “if the UK does not adopt a similar framework to that set out in EU law, Scotch Whisky, for example, would lose the very wide protection […] which ensures that Scotch Whisky is protected from direct or indirect use that exploits its reputation”.102

40.The National Pig Association (NPA) pointed out that “if the UK wants to register protected food names with the EU post-Brexit, it would first need to establish its own national approval scheme” which could then “be considered for approval under the EU protected food scheme”.103 According to the AHDB, “these products would also be protected by countries which have a Free Trade Agreements (FTAs) or bilateral agreement with the EU”.104 There are currently 23 EU GI product registrations from non-EU countries and 1544 GIs or equivalents (such as trademarks) from non-EU countries protected in the EU under bilateral agreements.105

41.Defra stated that “GIs are included in many of the EU’s Free Trade Agreements and other sectoral agreements” and that “there is a cross-Government programme of work to transition these agreements in order to maintain continuity in existing trade arrangements”.106 Defra intended to “use the EU (Withdrawal) Bill to incorporate relevant EU legislation into domestic law, providing the legal means to protect GIs in the UK after exit”.107 The Withdrawal Agreement, which was rejected by the House, included “the protection of existing intellectual property rights including geographical indications”.108

42.In the event of a no-deal Brexit, when the UK would leave the EU without a withdrawal agreement in place, the UK would “set up its own GI schemes” which would “mirror the EU schemes”.109 All existing UK products registered under EU GI schemes would “automatically get UK GI status and will remain protected in the UK” and Defra would “publish guidance on how to apply to the UK GI schemes in October 2019”.110 We asked the Food Minister whether the EU would continue to protect UK GIs following a no-deal Brexit and he told us that his “understanding is that as far as the EU goes, for a period of time at least our GIs would be recognised by the EU”.111 The Investment Minister was “fairly confident the mutual benefit on either side would mean we would see that maintenance”.112

43.Geographical Indications (GIs) provide legal protection against unlawful imitation of protected food and drink products. GIs confer a price premium on products and therefore they are economically important as well as being a recognised indicator of origin. Given the UK’s relative strength in high-value food and drink exports, maintaining the protections that GIs provide in major international markets is a priority for the Government. This is reflected by the inclusion of GIs in the Withdrawal Agreement negotiated with the EU.

44.The Government is optimistic that the EU will continue to recognise UK GIs in the event of a no-deal Brexit, given the mutual benefit, but there is no guarantee. Therefore, there is no room for complacency. Given the potential for the UK to leave the EU without a deal in October, the Government should ensure that the domestic GI system meets the criteria required for EU approval and is ready prior to exit, to minimise disruption to British exporters. It should prioritise seeking a reciprocal agreement with the EU on GIs if agreeing an overarching withdrawal agreement is not possible.

45 Food and Drink Federation, ‘Exports snapshot Q4 2018’, accessed June 2019

46 Food and Drink Federation (BFD0021),para 12

47 National Farmers’ Union (BFD0016), para 16

48 Agriculture and Horticulture Development Board (BFD0013), para 9

49 AHDB, International Consumer Buying Behaviour, (March 2018), p 4

50 AHDB, International Consumer Buying Behaviour, (March 2018), p 5

51 AHDB, International Consumer Buying Behaviour, (March 2018), p 5

52 AHDB, International Consumer Buying Behaviour, (March 2018), p 5

53 AHDB, International Consumer Buying Behaviour, (March 2018), p 5

54 AHDB, International Consumer Buying Behaviour, (March 2018), p 5

55 AHDB, International Consumer Buying Behaviour, (March 2018), p 14

56 British Meat Processors Association (BFD0035), p 1

57 British Meat Processors Association (BFD0035), p 1

58 British Meat Processors Association (BFD0035), p 1

59 Food and Drink Federation, ‘Food and Drink Manufacturing Sector Deal Proposal’, accessed June 2019; Sector Deals are partnerships between the government and industry on sector-specific issues that can “create significant opportunities to boost productivity, employment, innovation and skills”. There are currently nine sector deals (Life Sciences, Automotive, Creative Industries, Artificial Intelligence, Construction, Nuclear, Aerospace, Rail and Offshore Wind. See Department for Business, Energy and Industrial Strategy, ‘Introduction to Sector Deals’, accessed June 2019

60 Food and Drink Federation, ‘Food and Drink Manufacturing Sector Deal Proposal’, accessed June 2019

61 Food and Drink Federation (BFD0021), para 3

64 Quality Meat Scotland (QMS) (BFD0036), para 3

65 VisitBritain, ‘Structure of tourism in Britain’, accessed June 2019

66 Department of Business, Energy and Industrial Strategy, UK Food and Drink - International Action Plan 2016–2020, (October 2016)

67 Department of Business, Energy and Industrial Strategy, UK Food and Drink - International Action Plan 2016–2020, (October 2016), p 2

68 Department of Business, Energy and Industrial Strategy, UK Food and Drink - International Action Plan 2016–2020, (October 2016), p 6; Government Communication Service, ‘Congratulations to DEFRA for winning Campaign of the Month’, August 2018

69 Department of Business, Energy and Industrial Strategy, UK Food and Drink - International Action Plan 2016–2020, (October 2016), pp 6–8

70 Food and Drink Federation (BFD0021), para 6

71 Defra (BFD0038), para 1

72 Defra (BFD0038), para 1

73 Defra (BFD0038), para 1

74 Defra (BFD0038), para 2

75 DAIRY UK (BFD0027), para 5

76 Q7

77 Q7

78 Provision Trade Federation (BFD0043), para 17

79 Government Communication Service, ‘Congratulations to DEFRA for winning Campaign of the Month’, August 2018

82 Q240 [Dr Phil Hadley]

83 DAIRY UK (BFD0027), para 26

84 National Farmers’ Union (BFD0016), para 18

85 DAIRY UK (BFD0027), para 27

88 Defra (BFD0038), para 8

89 Defra (BFD0038), para 8

92 The Scottish Parliament Information Centre, Geographical Indications and Brexit, (August 2018), executive summary

93 Agriculture and Horticulture Development Board (BFD0013), paras 30–31

94 Department for Environment, Food and Rural Affairs, PRODUCT SPECIFICATION: Stilton Cheese, accessed June 2019

95 Agriculture and Horticulture Development Board (BFD0013), para 32

96 Department for Environment, Food and Rural Affairs, ‘Protected food name scheme: UK registered products’, accessed June 2019

97 Food & Drink Exporters Association (BFD0009), para 6

98 National Farmers’ Union (BFD0016), para 32

99 Hybu Cig Cymru - Meat Promotion Wales (BFD0025), para 2.6

100 Defra (BFD0038), para 6

101 Food and Drink Federation, ‘Exports snapshot Q4 2018’, accessed June 2019

102 The Scotch Whisky Association (BFD0004), para 11

103 National Pig Association (BFD0023), para 6

104 Agriculture and Horticulture Development Board (BFD0013), para 36

105 Agriculture and Horticulture Development Board (BFD0013), para 36; European Commission, GIs from non-EU countries protected in the EU under bilateral agreements, (April 2019)

106 Defra (BFD0038), para 6

107 Defra (BFD0038), para 6

108 European Commission, ‘Brexit Negotiations: What is in the Withdrawal Agreement’, November 2018

109 Department for Environment, Food and Rural Affairs, Protecting food and drink names if there’s no Brexit deal, (February 2019)

110 Department for Environment, Food and Rural Affairs, Protecting food and drink names if there’s no Brexit deal, (February 2019)

Published: 27 June 2019