Institute of Food, Nutrition and Human Health

Paper 119.180
July 2012

Food marketing - key terminology

Food - eaten daily by everyone in the world
Food products biological materials from the land and
sea. They are needed for the nutrition and health of
the consumers
Food system - a biological system from initial
production to final consumer
Consumers driving force of the food marketing
system
Needs states of felt deprivation
Wants form of human needs shaped by culture and
individual personality

Food system
Modern food system complex, dynamic and
international
World food and beverage market
estimated value in mid 1990s $2.7 trillion
estimated value in 2008 $5.7 trillion
Forecast value 2014 - $7 trillion

Dairy is our life's work. It's our passion and it's what we do best.

Global food system

What is marketing?
The management process responsible for identifying,
anticipating and satisfying customers requirements
profitably (Chartered Institute of Marketing)
The achievement of corporate goals through meeting
and exceeding customer needs better than the
competition (Jobber, 1995)
corporate activity involving the planning, pricing,
promotion and distribution of products and services to
satisfy customers current needs and anticipate and
create their future needs (Kotabe et al., 2005)

Agri-food and food marketing

Agri-food marketing
the sum of the processes, functions and services
performed in connection with food and fiber from the farm
on which they are produced until their delivery into the
hands of the consumer (Ricketts and Rawlings, 2001)

Food marketing
the activities needed at all stages in the food system
to facilitate the exchange of food products and services
which satisfy the needs and wants of individual
consumers and organizations (Schaffner et al., 1998)

Food marketing - specific characteristics

Consumers almost 7 billion world population

Product is perishable
Product is purchased on a continuous basis
Products require special handling
Rapid inventory turnover

World population
UN 2008 estimates and medium variant projections (in millions)
Year

World

Asia

Africa

Europe

Latin America

Northern
America

Oceania

2000

6,115

3,698 (60.5%)

819 (13.4%)

727 (11.9%)

521 (8.5%)

319 (5.2%)

31 (0.5%)

2005

6,512

3,937 (60.5%)

921 (14.1%)

729 (11.2%)

557 (8.6%)

335 (5.1%)

34 (0.5%)

2010

6,909

4,167 (60.3%)

1,033 (15.0%)

733 (10.6%)

589 (8.5%)

352 (5.1%)

36 (0.5%)

2015

7,302

4,391 (60.1%)

1,153 (15.8%)

734 (10.1%)

618 (8.5%)

368 (5.0%)

38 (0.5%)

2020

7,675

4,596 (59.9%)

1,276 (16.6%)

733 (9.6%)

646 (8.4%)

383 (5.0%)

40 (0.5%)

2025

8,012

4,773 (59.6%)

1,400 (17.5%)

729 (9.1%)

670 (8.4%)

398 (5.0%)

43 (0.5%)

2030

8,309

4,917 (59.2%)

1,524 (18.3%)

723 (8.7%)

690 (8.3%)

410 (4.9%)

45 (0.5%)

2035

8,571

5,032 (58.7%)

1,647 (19.2%)

716 (8.4%)

706 (8.2%)

421 (4.9%)

46 (0.5%)

2040

8,801

5,125 (58.2%)

1,770 (20.1%)

708 (8.0%)

718 (8.2%)

431 (4.9%)

48 (0.5%)

2045

8,996

5,193 (57.7%)

1,887 (21.0%)

700 (7.8%)

726 (8.1%)

440 (4.9%)

50 (0.6%)

2050

9,150

5,231 (57.2%)

1,998 (21.8%)

691 (7.6%)

729 (8.0%)

448 (4.9%)

51 (0.6%)

Approaches to food marketing

Functional approach activities are grouped
into functions
Physical manufacturing, processing,
packaging, transportation, storage
Exchange selling and buying, risk bearing
Facilitating standardization, financing,
market intelligence, communication,
advertising, promotion

Approaches to marketing
Institutional approach activities are grouped
according to the institutions that perform these functions
Private sector

Production

Cooperatives

Services

Future markets

Rules

Government

Facilities

Middleman - intermediaries between producers and consumers (agents,

brokers, dealers, wholesalers, distributors, etc.)

Approaches to marketing
Behavioural approach how firms adapt to
changes in:
Production systems input and output
Consumer preferences
Communication systems
Information systems

Supply chain management approach

integration of business processes from end users
through suppliers that provide products, services and
information that add value to the customers