HGTV or CPG: Open Concept is What Consumers Want

I’ll admit it: I’m an HGTV junkie. Take me through your house-buying process. Show me your before and after. Let me judge you for wanting a tiny house with a finished basement with room for a pool table.

After countless hours of analysis, the one thing every buyer and homeowner has in common is wanting open concept. Walls need not apply.

Coming away from the first day of the 2019 Legal Conference, my biggest takeaway isn’t all that different. When it comes to consumer packaged goods, consumers want open concept too.

There’s little clarity about how to achieve the transparency that consumers want — and likely will come to demand in time. Regulatory actions are disparate and murky. The federal government moves at a glacial pace. States and localities create a patchwork that companies need to comply with or stop selling their product, resulting in increased costs and less choice for the consumer.

But as we look at what consumers want in the future, we don’t need to wait for regulators to bring the walls down — and in many cases, we aren’t.

Consumer expectations are growing — and will continue to grow. Just like every home show, they want open concept and granite countertops, outdoor space and a double vanity. In the case of CPG products, they have a significant wish list and, unlike a homebuyer looking for granite countertops, they are unlikely to compromise on the things they care about.

At the 2019 Legal Conference, we heard four consistent themes about what consumers want and what legal teams will need to account for in the future:

  • Insight into how a product is made. Is it ethically produced? Is it humanely sourced?
  • Packaging that makes sense. Is it sustainable in some way—or better, every way? Does it fit the product inside or will you have slack fill problems?
  • Visibility into ingredients that matter to them. Is it low sodium, organic, gluten free, vegan, Halal? Where were the potatoes grown? And where was the tuna caught? You name it, consumers are more interested in that information.
  • Clear and simple label information. They want to know about ingredients, but they don’t want labels cluttered to the point of confusion.

None of these wish list items are surprising or unreasonable. Unfortunately, sometimes the wires get crossed — and that often happens when regulations conflict and conflate the problem.

For example, whole grain cereals are considered healthy by the FDA. But California’s Prop 65 requires warning labels on products containing chemicals that have been known to cause cancer, regardless of amount and regardless of how it got in the product. According to California, that requirement would extend to the acrylamide formed when you bake whole grain cereals. While California presumably would rather consumers were sold uncooked whole grain cereal, whole grain cereals are healthy in the other 49 states. A morass of 50 different sets of rules creates an unhealthy regulatory environment. Regulations serve a purpose, but patchwork, conflicting regulations only serve to confuse consumers.

Regulations can also create a problem where none exists in the minds of consumers. There is a debate raging right now about what certain plant-based foods should be called. Can almond milk be called milk? Should cell- or plant-based meat be allowed to have “meat” on its label? These are not arguments that consumers will concern themselves with. “Consumers don’t really care, they just want the option for these foods,” said Emily Lyons of Michael Best & Friedrich LLP. “They just want truth in labeling and advertising.”

It is incumbent on legal teams to be ahead of regulations, not just compliant. Let’s do the work of giving consumers the open concept CPG products they want and deserve.

The 2019 Legal Conference was held March 4-5. The annual event features in-house and outside counsel that provide expertise on the legal and regulatory challenges CPG companies are facing. Join us next February 25-26, 2020 in Rancho Mirage, Calif.