reLAKSation 49.
20%? According to IntraFish, new research by the University of Stirling concludes that products featuring a ‘Scottish’ descriptor can justify a premium of up to 20% against products with no such claim. Professor James Young of the Department of Marketing explained that ‘buyers normally only pay a price premium when they perceive there is be additional value in the brand’. The evidence from the research in the UK and France supposedly supports this view.
Unfortunately, Prof Young does not provide any evidence in support of these claims so it is quite difficult to make a realistic assessment of his findings to decide whether the ‘Scottish’ name generates a price premium or not.
Our own observations of the UK market place would indicate that if a premium does exist, it is almost indeterminable as illustrated by the following:
Marks & Spencer
2 Scottish salmon fillets - £13.00/kg
Morrisons
2 Scottish salmon fillets - £5.99/kg
Safeway
2 Scottish salmon fillets - £9.96/kg
Asda
2 salmon skinless fillets - £11.50/kg
2 Smartprice salmon fillets - £5.99/kg
Tesco
2 salmon fillets - £11.50/kg
2 Finest salmon fillets - £13.42/kg
Sainsbury
2 skinless salmon fillets - £13.30/kg
Sommerfield
2 salmon fillets - £13.30/kg
Waitrose
2 salmon fillets -£12.28/kg
Only three of the major UK supermarkets actually use the word ‘Scottish’ to describe the salmon they sell. These are Marks & Spencers, Morrisons and Safeway. With the sole exception of salmon sold under the Smartprice label, which is Asda’s value range, the cheapest salmon comes from Morrisons and Safeway, both of which are labelled as Scottish. Marks & Spencers salmon is more expensive, but it is not sold at a premium price above that from the other stores. In fact, if the price is adjusted for the fact that Marks & Spencers products are usually the most expensive in the UK food sector, then their salmon looks cheap compared to the salmon without the ‘Scottish’ descriptor.
This comparison of salmon sold through leading UK supermarkets clearly does not support the view that the ‘Scottish’ label can generate a price premium of up to 20%. This is not surprising, since previous research has shown that country of origin is of little interest to many consumers. If they are not that concerned about the origin of the salmon they buy, they are equally unlikely to pay more for salmon from a specific country, unless as Prof. Young says that they perceive additional value from that country. At the moment, this does not seem to be the case.
However, if there is any doubt about these findings, there is further evidence from the marketplace, which shows that salmon from Scotland is being sold at the exact same price as that of salmon imported from elsewhere. This evidence is becoming increasingly available because of the new legislation on labelling. Some supermarkets are now selling salmon from two or three countries of origin on the same shelf at an identical price.
This salmon is not promoted as being from a specific country, so the label does not state Scottish, Irish or Norwegian salmon, but rather it is just provided as extra information. It does not yet seem to influence consumer choice.
Price rise: Although we, at Callander McDowell, had perceived that salmon prices might stall, however they continue to creep upwards. Whilst this must be welcome, we do not believe that this is part of a sustained recovery with prices rising to former levels. Instead, the average annual price is likely to decline further in line with the overall downward trend.
It is inevitable that prices will fluctuate as the availability of different sizes changes. When there is a shortage of one size, prices will rise, just as when there is a glut, prices fall, with the then predictable claims of dumping and over-production.
Some industry representatives are convinced that the industry must have stability and predictability to overcome these fluctuations, but trying to dictate which sizes can be harvested at specific times will be an almost impossible task. Instead, the industry must move away from these production-led ideas and look to improved market development to overcome the vagaries of both fluctuating prices and volumes.
Taste test: Last week, representatives from the Institute of Agriculture and Trade Policy and the ‘Fishermens News’ staged a taste test in Seattle to evaluate a variety of different wild and farmed salmon.
The distinction between wild and farmed from the Pacific coast is more complex because of the number of Pacific salmon species, all with different eating characteristics. Not surprisingly, the tasters found some difficulty in identifying one outright winner. According to IntraFish, one farmed and one wild fish elicited the most positive reaction from tasters, which illustrates that the divide between wild and farmed is no longer a real issue.
Certainly, farmed species are much more widely accepted by consumers, who no longer see the farmed fish as being inferior. More and more farmed species are now appearing on the supermarket shelves so that aquaculture is now considered to be an accepted alternative source of supply.
Wild fish may be the only option for top chefs and foodies, but farming now means that consumers have an increasing choice of affordable fish.