Organic Silk Soy Milk from WhiteWave is kind of like the Coca-Cola of the organic shopping world. It’s one of the oldest, most trusted brands on the market, has wide appeal among vegans and omnivores alike, and sports a whopping 72% market share. It’s a total beast, a veritable pillar of the organic market.
So when Dean Foods bought WhiteWave in 2002, many wondered if the fat lady was singing for Silk. Would the brand retain its squeaky clean rep under corporate management? Would it continue to be the organic beast it had been since 1977?
Well, this year, the fat lady finally cut loose. Dean Foods announced earlier this year that it was moving away from organic ingredients and starting a “Natural” (conventional) line of Silk.
In the midst of a massive, economic flat tire, you can’t fault a company for moving to remain competitive, but when your bold maneuvering confuses both retail partners and customers, it may be time to re-evaluate your jukes and jives. On that front, last week, organic watchdog group Cornucopia Institute filed a complaint with the USDA’s National Organic Program against Target Corporation for selling conventional food as organic – in this case, for advertising “Natural” Silk Soy Milk as certified organic in a national circular (a violation that could draw a $10,000 fine).
Was Target actually trying to profit by customer confusion, or was the company just as confused by Dean Foods’ watering down of potent organic brand Silk as everyone else in the market?
Mark Kastel of the Cornucopia Institute isn’t sure how to read Target’s natural-as-organic advertisement. “It’s either a willful attempt to deceive organic consumers, or incompetence on Target’s part that they don’t have the staff to catch something this obvious.” Regardless, it’s hard for Kastel to see this action as completely innocent. “Either way, it’s part of a sinister market shift on the part of major companies to muddy the line between organic and natural.”
After all, Dean Foods made this switch from organic to “Natural,” according to Kastel, by slipping the change quietly into the market place. “Silk didn’t lower prices when they shifted to conventional soybeans,” Kastel says. “They rolled out the new product on unsuspecting retailers without even changing UPC codes.”
Erturk Mehmet, a grocery buyer at Wedge Co-op in Minneapolis, says that while he did receive a heads up from Dean Foods on this change, that, nonetheless, customers were still very confused when organic Silk went Natural. To a degree, it was unavoidable. Organic Silk had been on co-op shelves, year in and year out, for over three decades.
“Yes, people did have a lot of questions about it,” Mehmet said. “They actually thought that [Dean Foods] was putting ‘Natural’ soybeans in the organic soy milk.” Mehmet’s co-op handled this by getting information about the new Silk to interested shoppers as quickly as possible.
Did Target act similarly? Not likely. It’s hard to imagine information about “Natural” Silk filtering down to Superstore customers, when it didn’t even get passed to the marketing team in charge of Target’s circulars and advertising.
Confusion in grocery stores and supermarket marketing aside, the irony of such an important organic brand going “Natural” is hard to overstate. After all, the USDA’s All Natural label stands as a cautionary tale of what happens to eco-labels on the road to hell.
The All-Natural label was created in the early eighties in response to claims that a number of beef ranchers were making at the time. Mel Coleman Jr., Chairman of Coleman Natural Meats, says his family’s company was the first to use the phrase “all natural” on its packaging, and the label was reliable, back in the day. But the standards behind “All-Natural” crumbled year by year until “it became a joke,” according to Coleman. The main problem was that compliance with All-Natural standards was completely voluntary – the USDA didn’t put any teeth into enforcing them (as it does with organics now – a lesson learned). Consequently, the standards were ignored, and later, tweaked, to make room for bigger beef producers who wanted to use the label, too.
“People with a lot of money got interested in making the same claims we were making, so bit by bit, important points were taken out of the standards,” Coleman said.
Today, All Natural can be used on any grocery items from beef to salad dressing to, well, soy milk. According to the USDA, the word “natural” may be used on a label when products contain “no artificial ingredients and are no more than minimally processed.” Whatever that means. Even in beef production, All-Natural no longer means the prohibition of antibiotics and growth hormones, as they used to when Mel Coleman first used the label. So Dean Foods can make all the boasts it likes about how natural and eco-friendly its “Natural” soy beans are, but there’s no way to prove it. That’s a disservice to the natural foods consumer who prizes believable claims on their food.
Moreover, for the once-vaunted Silk brand to moonwalk back from certified organic to “All Natural” is a sad retreat from farmers who’ve gone the extra mile to sustain their lands, shun pesticides, seek organic certification, and who completely depend on big brands like Silk for their livelihood. This move away from organics didn’t begin this year, after all – it actually began shortly after Dean Foods bought WhiteWave and Silk. According to Behind the Bean, a report on the organic soy bean market from the Cornucopia Institute, Dean Foods demanded that organic farmers drop their prices to Chinese levels.
“We proposed to work diligently within the Kansas Organic Producers cooperative,” organic farmer Orin Holle said of the negotiations with Dean Foods, “to supply superior quality beans with guarantees of being U.S. grown through the established organic audit trail process. While [Dean Foods' WhiteWave] ‘talked the talk’ about purchasing the beans from U.S. producers, when the pricing structure was proposed to make the venture modestly profitable for the U.S. growers, the bottom line answer was that if we weren’t willing to provide the beans at a price equal to or less than the cost of available beans from China, our proposal couldn’t be considered further. End of negotiation.”
This was back in 2002, six years before the current downturn began, making it hard to believe that this move away from organics was driven by the recession.
“Do you know how much soy is in a carton of soy milk? It’s nothing. It’s next to nothing. A very small amount,” Kastel told me. “Dean Foods was already making a huge profit on Silk, but I guess it wasn’t enough. So they abandoned organic farmers.”
In other words, the bottom line is only line for Dean Foods, organic farmers and consumers be damned. A strange stance to take, considering the organic foods shopper, a person who typically likes to know that strong values go into the foods they buy, and who fuels the growth of the organic industry, which still outstrips the rest of U.S. agriculture even in a recession.
It’s even more strange since so many enormous, “non-organic” food companies are growing to understand that there’s market value in paying a good, sustainable price for ingredients. Taco Bell now pays the Coalition of Immokalee tomato farm workers what they’ve asked to be paid. Bon Appetit has agreed, as well.
But Dean Foods wouldn’t negotiate with organic farmers on a fair price for soy beans? Even before the recession hit? It shows little faith or deep understanding of the organic market or of the foundation of Silk’s success (founder Steve Demos put a high priority on what he called “identity preserved” organic soybeans).
If there was ever a brand that could tell a powerful story to a receptive audience about supporting organic farmers in a time of need, it’s Silk.
