Value chains are replacing brands are the most powerful weapon in the marketing arsenal.

While still widely perceived as source of risk, value-chain transparency actually offers brand owners an opportunity to create new forms of value for customers at an emotional and ethical level—the level where brands have traditionally operated.

In contrast to brands, the equity currently locked within value chains is real, testable and valuable to end-users. Learning to release this value is the key to sustainable competitive advantage.

A Changing Mood

On 18 February 2005, the Foods Standards Agency (FSA) informed the British public that a batch of chili powder contaminated with the Sudan 1 carcinogen was now fully dispersed within the food chain. The batch had been imported in 2002, and the agency had apparently been aware of its existence for at least 18 months. (ref 1)

When they finally announced the recall of a list of contaminated products, the list of 429 was incomplete, requiring many updates. Three weeks later, the number of products on the list had climbed up to 618. The agency is still unable to provide clear assurances that the list is now comprehensive and that the goods have all been recalled. While this incident has been "effectively" smothered in terms of media coverage, the public is now attuned to the risks of opacity.

Around the same time, the Evening Standard (ref 2) decided to compile a weekly shopping basket at a Waitrose supermarket, and calculated that the total mileage traveled by its shopping would stretch as far as the moon. The cheddar cheese on sale was produced in Tasmania, some 10,000 miles from the Cheddar Gorge. The environmental impact of this situation is (currently) immeasurable, but again, public sensibilities are increasing.

These two examples indicate of the growing public and media scrutiny of the negative impact of supply chains. The two show how partial opacity is bringing new dimensions to customer accountability. Purported Corporate Social Responsibility (CSR) is increasingly visible, and will be tested at the product level.

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ABOUT THE AUTHOR

Tim Kitchin is a founding partner of Glasshouse Partnership (www.glasshousepartnership.com), a branding and stakeholder relationship management consultancy; he has published articles on branding, supply-chain management, corporate social responsibility and customer relationship management.