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Chinese consumers positive about Fonterra recall

Thursday, January 16, 2014

Chinese consumers positive about Fonterra recall

Fonterra’s recent recall of fresh cream due to E.coli has gained widespread media attention in China, and is viewed by Chinese consumers as a positive response by a highly responsible firm.

Associate Professor of Marketing Dr Henry Chung from Massey’s School of Communication, Journalism and Marketing, who has been studying the Chinese market for more than 20 years, says the recall has received extensive media coverage in China.

“Leading Chinese media, including Xinhua news and Sina – which is associated with Weibo and CCTV – have all reported about the recall. A search of Baidu (China’s version of Google) brings up 291 news items. This is all for a product that was only supplied in New Zealand.”

It is big news at a time when Chinese consumers prepare to spend up large in the lead-up to Chinese New Year.

“Chinese families often gather for annual reunion dinners at Chinese New Year, so the time spent before then is used to clean the house and stock up on provisions before the big day. It’s the busiest shopping time of the year,” he says.

Dr Chung spoke with a group of Chinese consumers about the fresh cream recall, and says they were pleased to see Fonterra take action quickly and voluntarily. “Most Chinese firms would not do this type of recall unless forced to do so by the Government or consumers. This shows Fonterra as a highly responsible firm that takes product safety seriously.”

Chinese consumers also liked the honesty and transparency of Fonterra’s actions during the botulism scare last August, with one commenting: “It is admirable that they would sacrifice their revenue for a false alarm, to ensure the customer’s ultimate safety.” Dr Chung says Chinese consumers appreciated the visit to China by Fonterra’s chief executive officer Theo Spierings to clarify why Fonterra took the action that it did.

Dr Chung says the process followed by Fonterra over the fresh cream recall in New Zealand demonstrates a willingness to improve on past lessons, and identifies this as an opportunity to highlight the company’s depth of knowledge and experience in food safety to Chinese consumers.

“More could be done to explain those stringent food safety processes in the Chinese market. Perhaps an online explanation in Chinese that simplifies the testing process the products go through could help demystify and provide reassurance about the integrity of the process.”

Dr Chung also says that New Zealand firms need to more closely monitor their international markets when domestic incidents like this occur. “Opportunities will arise from situations like this to reinforce New Zealand’s hard-earned reputation as a high quality food-producing nation, where food safety is paramount. This is also something that the New Zealand Government needs to support, so that New Zealand Inc. benefits as a whole.”


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