Preparing For Tomorrow’s Consumers: Cool Fresh’s Nic Jooste Returns To New York’s Global Trade Symposium With Ideas Garnered From His Unique ‘Market Match’ Challenge
Jim Prevor’s Perishable Pundit, December 5, 2018
Predicting the future is very difficult because if we really knew what people would do in the future, we would do it now! Nic Jooste has taken on the difficult task of trying to understand the future and the way the produce industry can conduct itself to take advantage of what the future holds.
He has presented in New York, London and Amsterdam, always to wide acclaim. We’ve profiled these presentations in articles such as these:
The Disruption Of Established Markets: How Four Strategies Can Help Transcend Today’s Dilemmas
Can Retailers Show A Little Love For Produce Marketing? Dutch Marketer Nic Jooste Will Share His Thoughts On Swimming Upstream At The Global Trade Symposium
PRODUCE AND GENERATION Z
Can We Make Our Pitch Effective In Eight Seconds Or Less?
There’s a Dutch Saying... Amsterdam Produce Show To Bridge Cultures And Channel Innovation
Making Produce Marketing Everything It’s Not: Creative, Innovative, In-your-face, Non-conventional, Digitally Driven, Attitude- And Adventure-oriented… Nic Jooste Of Cool Fresh Guides The Trade On How To Capture Gen Z And, Next, Gen Alpha!
Nic is up to disruption again… this time having participated in a unique program that brought together captains of the produce industry with the best and the brightest of university students. This program sought whether this combination of deep experience and youthful attitudes could imagine the future.
We asked Matt Ogg, Contributing Editor at Pundit sister publication PRODUCE BUSINESS to get into Nic’s head and engage in a wide-ranging discussion as to the ideas that will inform Nic’s presentation at the Global trade Symposium in New York.
Partner and Director of Corporate Communications, Marketing & CSR
Cool Fresh International
Q: The British writer L.P. Hartley coined the phrase: "The past is a foreign country; they do things differently there." At Cool Fresh International, you make a point of not relying too much on past examples, but rather harnessing the ideas of university students as a kind of lens into the future. Could you please discuss the premise and applications of the Market Match program you launched this year, and how it helps future-proof your business?
A: The background is that in February 2018, I was invited to a so-called “Vice Presidents’ Dinner.” Some 10 senior executives from the fresh produce industry were invited. I had just turned 60, but I was the youngest at the table. The purpose of the evening was to listen to a presentation by a consultant who wanted to sell a project to us for doing research into the ‘future of fresh produce, and how new consumer generations were going to see our products’.
At the end of the meeting, the chairman of the group asked us for our personal observations. I was last to go, and this was my response: ‘I am surprised that WE are being asked for our opinion regarding the future. If I look around the table, I see people with a very limited future. Shouldn’t we be asking the youth – who have a bright and statistically much longer future than all of us — what THEY think of THEIR future?’
My purpose was to get them out of their boxes, and man, did I succeed! There was a stunned silence. And then the reactions started coming. They said stuff like: “My company has been very successful for the past 50 years,” “I have been on the board of innovation for 26 years,” and “I have worked with many industry leaders on various supply chain projects.”
These ‘oldies’ were all looking back in history over their shoulders, and they had real difficulty in understanding how difficult it is to fast-forward yourself into the future. In the end, I convinced them.
The premise of Market Match was to get together a group of industry leaders with vast experience and partner them with bright young minds from various universities, colleges and different fields of study, and see what develops. The idea was to see whether we could cross-pollinate by combining our practical business experience in the fresh produce industry with the ‘no limitations’ thinking of the youth.
My personal objective was primarily to see if we could get our ‘dinosaur employees’ to become enthusiastic about getting out of their boxes and start thinking creatively. For instance, these are some of the ideas:
Instead of seeing trucks, think drones.
Instead of seeing a leek, see a vegan taco.
Instead of seeing a human being at work behind a computer, think of artificial intelligence.
Instead of thinking mainframe, servers and Excel, think about blockchain.
The bottom line is rejuvenating the workforce, not only in terms of the age of our employees, but also of the youthfulness of how we think.
Q: How practical do you find the ideas these students bring to the table? Do the ideals or visions expressed always stack up with the economic reality?
A: With this question you are actually falling into the trap that most of the ‘oldies’ do. It is not about the economic reality as it stands right now; it is all about grabbing the opportunity to try to understand how future consumers will look at fresh produce.
Will they see pills instead of pepper?
Right now, we are not interested in a new smoothie or a different juice. We want to understand the psyche of the new generations specifically as it applies to food and fresh produce.
That being said, yes, we are seeing ideas with an immediate practical application. For instance, a range of veg-based breads. Or, in our case, single-garlic cloves packed in a convenient, hygienic packaging — this we have now given to a university food science and innovation laboratory to do the necessary research.
Q: And are there any other practical applications from Market Match that have been taken on board in your operations, or in discussions with suppliers?
A: The cooperation agreement with the partners in the Market Match program was that ideas and concepts would be linked to the most suited partner. Forty concepts were created, so we are still working through it.
Our range of partners in the project included banks and consultancy firms. We do know that two of the four prize winners have been approached to develop the concepts further, like the veg-based breads just mentioned, and a veg-based topping of sprinkles and confetti for pizza, lasagna or pancakes.
Another one is a fresh produce recruitment app based on Tinder.
Q: Now that’s something different. Swipe right on the next candidate! How will that work exactly?
A: Let’s take a step back first… One of the issues that we put to the students is that it’s very difficult to get young people into the produce industry, and one of the reasons is that the whole recruitment process is still very traditional.
All these students also did a field trip. They visited a number of companies and they said “wow, this is really a cool industry.” The particular group that developed the app, when they were doing their preparations, they said, “but we cannot find the passion and the excitement of the fresh produce industry in the recruitment processes,” because it’s all so traditional and doesn’t inspire anyone to want to apply for a position.
So, they said you should make it sexy, friendly, more dynamic. It was basically the same principles as Tinder — applicants create a profile and they upload their story.
Q: Is that something they’re going to be working on with these banks or consultancies to develop further?
A: Yes, and it was very interesting because for us we had taken a risk of forming the teams on the basis of diversity. We took people from the north, south, east and west of Holland and put them into one team. They didn’t know each other at all. At the same time the mix was also taking people from university level to technical college level.
In the Tinder-style produce recruitment app team, it was a technical guy who put together this app on his telephone and he could demonstrate it to us while we were standing there. In some cases, you had people with really high levels of academic education taking the lead, whilst in others you had people from a lower academic level but with a social or technical insight taking the lead in the process.
I must also say that I haven’t seen all 40 projects yet. I am asking for a summary of all of them so that I can give more insight. Because we had a number of partners within the project, we agreed on a specific way of working where the projects would go to the local government of Rotterdam first, and then we would have access to it.
Q: And will you be including more of those examples in your presentation at the New York Produce Show?
A: It depends on what comes out of it. My presentation in New York is a lot more built around the process and its background, because there’s a three-year background with Cool Fresh. It’s around how companies could use the inspiration of working with universities to create new thinking capacities.
Within the 10 groups I worked with in Market Match, I could probably give you more examples like the Tinder recruitment app, but I think one is enough. It’s about the principle. At the moment, I have a university guy working on mobile commerce within my company. He is doing something that nobody else is even thinking about. He is Dutch-Chinese, so I’ve put him onto researching what is happening in China and how could the best practices in China be applied to the Netherlands.
Most fresh produce companies would take a young person and say, “here’s a box of apples… let’s take a look at how we can innovate it in packaging,” for instance. We are doing stuff that’s not even close to home, but only in doing that will we see where the future is moving.
What we are doing with the young people who are moving in and out of the company is to get the young guys to understand that, yes, they have unique insights and skills, but, no, they don’t know everything. And for the older people, they have all the knowledge and all of the skills of trading etc., but don’t know futuristic and strategic planning. So, we should keep both these groups and get them to work together.
Q: A couple of years ago, you spoke with the Perishable Pundit about the eight-second attention span of Generation Z shoppers. Like Olympic sprinter records, are these times getting shorter?
A: My youngest son turned 18 today. I spent the early morning drinking coffee with him, and the answer is a resounding yes! At the time of doing the Gen Z presentation, the average attention span on a mobile phone was eight seconds. I counted him swiping through at least four applications or pages in eight seconds.
My son of 21, who is a mobile whiz, says that in terms of advertising if a digital advertisement does not hit the spot within two seconds the youth simply swipes it away.
Q: As they're getting older, what has changed with the Gen Z consumer cohort and the industry's approach to them?
A: I do believe that the fresh produce industry has taken some cognizance of the changing face of the consumer. Are we doing enough? Absolutely not! Trading companies are under much pressure in terms of stock, and every day is a new challenge to move fresh produce as fast as possible.
But there is light at the end of the tunnel. Last night, I enjoyed a glass of wine with a very good friend who is the owner of an old fresh produce trading company. He is making a substantial investment in setting up a sushi factory, which produces all-vegan sushi products in the most amazing variety of sizes, styles and combinations.
My son of 21 says that this is where the answer lies for fresh produce companies: stop seeing ingredients and start visualizing food items that appeal to the new generations of consumers. Obviously, not every fresh produce company can set up a vegan sushi factory, but I firmly believe that every fresh produce company can take a step forward in terms of innovation.
Look at your product with different eyes. Take a look at what other industries are doing in terms of packaging and communication. Travel to your clients and take a look at the shopping behavior of their consumers. In other words, get off your chair and out of your box.
Q: What are some interesting retail campaigns targeting this generation, or others, that you've seen in the Netherlands or other European markets where the fruit and vegetables you import are traded?
A: That is the point — I have not really seen any! Other industries, companies like Vodafone, Axe and Adidas have implemented strategies aimed completely at Gen Z. In Europe, the most innovative approach that I have seen was a company using tattooed models in their B2B communication. I still believe that Cool Fresh International’s ‘gorilla video’ showed what communication with Gen Z is all about.
Even with an actual content length of 21 seconds, I have yet to meet a Gen Zer who will swipe it away. This video was made to show that a ‘simple’ fresh produce company can actually produce a communication concept which talks to Gen Z.
Q: I’d like to chat about current trends. It’s common to hear about an emphasis on local and sustainability, and I say both because they are often mentioned in the same breath. So as an importer, how does that direct your marketing strategy, as well as the actions you undertake?
A: Good question! We have been involved in CSI (Corporate Social Investment) for 15 years and have seen all the arguments come and go. And they keep on coming and going.
As the only fresh produce company in Europe with the high Level 4 standing in the CSR (Corporate Social Responsibility) Performance Ladder management system, we continuously evaluate our operations against the latest developments. Yes, local is an important issue right now, but not the overruling one.
We are not yet able to grow pineapples or bananas in the Netherlands so we have to import. However, we are working with many local growers in Europe — such as Spain, Germany, Netherlands, Belgium, France and Greece — in order to maintain a good balance between imported and local.
And remember, the market is really a seasonal one, with retailers demanding the best possible produce 365 days of the year. I have yet to find a retailer who will say to a consumer ‘Sorry, we cannot supply you with mandarins right now because we refuse to sell imported ones’.
In terms of the sustainability aspects of our overseas products, I do believe that we have our ducks in a row. We focus heavily in the shortest, most environmentally friendly supply chain. We work with our growers on water and environmental issues. We have a really heavy focus on trading integrity and labor conditions.
Q: There has been a heated discussion for some time now about plastics in the ocean and a push, both from retailers and legislatively within the EU, to move towards recycled plastics. But on the other hand, a lot of the advancements in packaging technology have reduced food waste, and thus help conserve the input resources that go into producing fruits and vegetables. How do you see this trend and the apparent dilemma between these conflicting ideas playing out?
A: Don’t get me started. Yes, the retailers are pushing for a decrease in ‘traditional’ plastics, and the packaging industry is doing great work with producing more and more packaging based on recycled plastics, yet in Western Europe, every time I visit a supermarket I see more and more pre-packed fresh produce.
This is largely due to high wages, with retailers minimizing the amount of handling required on the shop floor. Go to Eastern Europe, the Balkans and other areas where the modern retail modus operandi is not yet dominating, and you will see a vast percentage of fresh produce still being sold unpacked. I believe that these markets are doing more for sustainability with regards to packaging than most modern markets.
In the Netherlands we even have a ‘packaging-free’ store, where the consumer has to bring his or her own containers or bags. The specialists all agree that these types of stores do not have a realistic chance of survival. Why? Because of the power and reach of ‘big retail’.
In the end, the retailer decides what is offered to the consumer. As suppliers, we have a duty to keep on pushing approaches and concepts that add to sustainability in the broadest sense, yet ultimately the retailers decide.
At the same time, the cost of the new generation of recyclable plastics is prohibitively high. A retailer will not absorb the extra cost of using such packaging, and neither will the consumer. In the end, the grower will wind up paying, and then we would end up in a totally different discussion.
One of the all-time Dutch football greats — Johan Cruyff — once said: “Every disadvantage has an advantage.” If one reads the literature, different people and institutions offer different perspectives.
Q: Thinking about a simple practical example, just the other day on the other side of the world here in Australia, I did my weekly fruit shop at a specialty grocer and there were some great value promotions in black polystyrene trays. I have been trying to reduce my consumption of such packaging as I understand it’s one of the slowest to biodegrade because of the thickness. However, this particular store had signs up offering to take the fruit out for you so they can re-use these trays in further promotions. I thought that was a marvelous idea – do you think there is more potential for policies like that amongst European retailers?
A: You know, probably in Western Europe, the supermarkets tend to have as few hands as possible within the store, and every single extra thing that needs to be done is costing money. That is my biggest dilemma. Yes, they’re all talking about reducing plastics and reducing packaging and protecting the environment, but every time somebody comes with a practical or environmentally-friendly idea that is a bit more expensive, it cannot be done.
So yes, I do see that there’s a willingness to think about these types of things, but they consider how it affects labor cost. In this example, the cashier actually has to do something else and another handling action is going to take more time, so we they need more cashiers.
I think it depends largely on the type of retailer. The bigger the retailer, the more difficult it is to get those practical things at store level done, because the bigger guys who need the big volume tend to go mostly for pre-packed products.
On my desk, I have probably 20 examples of those trays which are 100% organic, made from fruit pulp and I don’t know what else, but it’s 20% more expensive. So, at this point in time, the packaging companies don’t yet have the economy of scale to produce a big amount, and it’s too expensive right now.
It’s something that won’t go away, but as more and more retailers step into fully biodegradable packaging, the price will also come down. At the moment I think it’s a case of who is going to take the first step. In the Netherlands we have one supermarket chain that is fully focused on sustainability at also an environmental level.
I am seeing for instance in Lidl, which is a main discounter in the Netherlands, that a lot of their fruit is not pre-packed. You go into the store, you take your five apples or your 10 apples, you don’t even have to weigh it; it’s weighed at the cashier, and it gets charged directly. The only problem is they still use plastic bags.
I’m still seeing a lot of the smaller chains that need to have a different story coming up with paper bags, for instance, which does have a cost effect, but you tend to see that consumers who go to specialty retailers don’t mind paying five cents extra.
So, the difficulty of giving a clear commentary on something like this is simply because of the fact that we have such a wide range of retailers within our small country, and the bigger guys are into the lowering of labor costs, and the smaller companies need to have a different story.
Q: Yes, and this is one of those specialty stores. This is not one of the main supermarkets so that does fit with what you’re saying.
A: We have wonderful things going on. One of the main items within our retail now is every single store has an orange juicing machine, so you put your bottle into the machine, the oranges get squeezed and you take it away.
But you end up with a whole lot of orange peels at the end of the day, so the smaller guys are doing all sorts of projects with people who are difficult to employ for whatever reason, and they are making marmalade or essential oils and all those types of things from the orange peels from the juicing machine.
Q: Another big macro trend is the shift towards online shopping. How do you feel this is changing the game of the produce industry? I'd be curious to hear particularly about what you're seeing in the Netherlands and neighboring countries.
A: As The Donald would say — “It is huge!” We are seeing new online concepts and companies being introduced regularly. Every day, I see small delivery vans from just about every supermarket in the vicinity of my village doing the rounds. The most talked about online supermarket with no stores is Picnic, which uses small electric vehicles to do their deliveries.
Already servicing consumers in 60 cities, including some in Germany, Picnic still has tens of thousands of consumers on the waiting list. From a personal perspective, this shopping option has changed my busy life. However, fresh produce remains a challenge, in the sense that the order picking for such perishable products remains a challenge. It is, however, just a matter of time before order-picking robots are also able to pick and handle fresh produce on the basis of freshness, color, etc.
We are also seeing a rapid growth in the online ordering of fruit for delivery to offices. The trend is moving towards offering companies a broad offering of ‘healthy’ products all in one basket: juices, nuts, fruit. I believe that this is a major opportunity for the fresh produce industry — we just have to get our distribution and communication models right. Loren Zhao of Fruitday in China is a real inspiration!
Q: Another fascinating topic in a similar arena is the trend towards convenience deliveries and meal kits — is this an area that the fresh produce needs to explore or is already exploring?
A: Again, from a personal perspective, I love this development. Whilst I consider myself to be a good hobby chef, my busy life has prompted me to use meal kits, specifically Marley Spoon, on a regular basis. Whilst the concept is great, the content in terms of fresh produce is still too low. Our major retailer Albert Heijn offers the same concept, delivered together with your normal groceries — good variety, solid volume, and really easy recipes. It is a salvation for busy people.
Another amazing development of the past two years is the so-called ‘fresh packs’ or ‘meal packs’. These are packs that contain all the fresh ingredients necessary to prepare a healthy meal. Various types of soups and stews, chilis and curries — every retailer has jumped on the bandwagon, and I see this as a real innovation in getting consumers to ‘buy and eat healthy’. It is simple yet brilliant. And where did it originate? With a packaging company. Makes you think, doesn’t it?
Q: Moving away from these consumer trends, I’d like to go more macro. This is a Global Trade Symposium after all, and in the world right now we are seeing a lot of socio-political uncertainty, whether that be issues like Brexit, tense relations between major powers with tariffs, and fluctuating currencies. For a produce company like Cool Fresh International, how do you future-proof yourself for the supply-side and market challenges of this environment?
A: We have recently launched our ‘Connecting Fresh’ strategy. This is based on making the very best use of the extensive and really well-developed skills within our company. Instead of trying to maintain a grip on our position as importer and supplier of fresh produce, we now have positioned ourselves as a service provider, which is able to offer a solution across the entire spectrum of the supply chain.
The world has become completely transparent, making it unavoidable for a company to understand that it will only be awarded for adding value. In the ‘old, non-transparent days,’ companies earned a lot of money simply because growers did not know who the retailers were, and vice versa.
That has all changed, and as a result a fresh produce company has to change its game as well. In some instances, we act only as quality controller for an overseas grower; in another instance, we are the marketing partner for a grower and take all decisions jointly. We assist a major retailer with cross-docking, sometimes also selling a product to them.
In some instances, we supply a retailer with just one product, whilst in other instances we supply a full range of items which we source overseas and locally. Basically, we now have a full menu of possibilities that we offer to growers and retailers. Our main focus is never to say ‘no’, and to never have a client going to a competitor for something that we could have done. This strategy makes our lives a lot more complex and definitely never boring! It is all about keeping your clients close to you.
Q: I'd like to finish the topic by discussing your native South Africa. Now, the Western Cape has had issues with drought for a while now and it was only in April that people were talking about "Zero Day" in Cape Town. What are you seeing as the effect of this drought on South Africa, and what do you think the implications of it will be?
A: It is estimated that farmers in the Western Cape had to abandon at least a quarter of their high-value vineyards and deciduous fruit orchards because of a lack of water for irrigation. This had a knock-on effect on rural employment, with the loss of about 30,000 seasonal farm worker jobs during the harvest season.
Academics think that the loss of this production would have a long-term impact on the agricultural sector. The consensus is this 25% reduction can only be incrementally salvaged if and when farmers can afford to replace those orchards and vineyards. For most farmers, it is impossible to suddenly reinvest in 25% of the farm. However, some friends in the fruit industry say that farmers usually replace their orchards and vineyards in cycles when the plants reach the end of their lifespan after 15 to 20 years.
There have been some effects on fruit exports since the drought became world news, but traders all agree that in some instances this also had a positive side on pricing.
To give a positive dimension to the discussion, it is clear that this crisis was a major wake-up call to the Western Cape in particular, and to the country as a whole. The national and local governments now understand that water is a key economic ingredient and should be treated as such. There have been many solid reports and advisory commissions on this subject, but in the past, nobody was confronted with a disaster of these dimensions.
Consumers also got the greatest scare of their lives. After centuries of turning on their taps and seeing water flow from it, all of a sudden even the affluent consumers had to fill up bottles and buckets. Let’s hope that everybody will be respectful of water, although in this modern society I have my doubts.
In this regard, I must say that the problem does not lie in the disadvantaged areas (so-called townships), as most people there collect their water from a communal tap in any case. The problem lies in the affluent and middle-class neighborhoods, where people just view water as part of their privileges. I mean, the swimming pool should be refilled regularly, right?
Q: And on a more sensitive note, earlier this year the South African President Cyril Ramaphosa was talking about confiscating land from white farmers. Now, my apologies if this topic hits too close to home, but where do you see this political issue headed, and what could it mean for the fresh fruit industry? And how should fruit growers and exporters respond?
A: It is an emotion-charged topic, and I do not have to go into South Africa’s history to explain it. In September 2018, President Cyril Ramaphosa appointed a panel of heavyweights to advise him on this issue, including agricultural specialists. I have no single doubt that this panel will come up with a plan that will be ‘good’ for the country.
The outcome of the land reform issue will, however, depend largely on the position of power which President Cyril Ramaphosa will be able to exert on the ANC (African National Congress) leadership after the elections of 2019. If he is able to take firm control of the ANC - which currently is split into several camps - I am sure that the land reform plan will be honest, clever and of economic benefit.
If one reads clearly between the lines, Ramaphosa’s plan will firstly focus on unused government land. In terms of the fruit industry, there have been recent discussions between Ramaphosa and representatives of the agricultural community. Whilst it was a preliminary discussion, the feeling was that Ramaphosa’s focus was firstly and foremost on finding an equitable solution.
My opinion of Ramaphosa is that he is an extremely competent economist and statesman. If it comes to him, no fruit farmer should have fear. The big threat comes from the radical elements who want to see anarchy instead of ‘Nelson Mandela’s South Africa’. Let’s hope and pray that Ramaphosa is able to turn them around!
The issue of the vegan sushi is another way of saying that as businesspeople we have to always be reassessing what our job or function really is. When this Pundit started in 1985 by launching PRODUCE BUSINESS magazine, we might have said our function was producing magazines.
In time, though, we reassessed and said that we did two things: First, we provided information and insight to the trade; second, we brought together buyers and sellers. We soon reimagined our business and said we can do those things in print, online and in-person.
With cooking and food consumption patterns changing and with consumers less interested in ingredients and more interested in meals, many industry executives may have to rethink their future in the produce industry.
The Global Trade Symposium is co-located with The New York Produce Show and Conference. Join us in New York to talk with Nic and dig deeper into the future of the industry so that you are able to capitalize on that future:
You can register for the show here.
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But come to New York, And SOAR into the future!