How The Market For Animal-Friendly Food Products Works
A brief description of “animal welfare” as a marketing term, used by retailers to protect and differentiate their brands and products, discusses the three basic retailing dynamics of “brand management,” “innovation with supply chains,” and “limitations to supply and demand.”
Food retailers use the term “animal welfare” as a marketing term to differentiate their products. There are three inter-related retailing dynamics involved with the use of this term.
Brand Management: Retailers use their control over the quality of the supply chains to include farm animal welfare criteria, especially for own labels.
Innovation with Supply Chains: Quality Assurance schemes have provided a key instrument for defining safety and quality, including farm animal welfare, which are used to “ensure a more transparent process in defining minimum standards for products and settling specifications for higher quality ranges and products.”
Limitations to Supply and Demand: Demand for animal welfare-friendly products is not consistent across all categories of items, retailers, etc. Only higher valued meat cuts are typically marketed as “welfare-friendly,” and the other cuts may not receive a premium price.