NielsenIQ acquires product attribute powerhouse Label Insight. Learn more >
Disclosure legislation is appearing more frequently as consumers increasingly demand transparency from brands into the products they buy.

Why Digital is the Best Way to Comply with Disclosure Laws

Posted June 9, 2021

Disclosure legislation is appearing more frequently as consumers increasingly demand transparency from brands into the products they buy. The California Cleaning Product Right to Know Act, the FASTER Act for sesame labeling, the National Bioengineered Food Disclosure Standard (NBFDS), and now proposed legislation for using the term “healthy” on packaged foods all require brands to disclose various information about their products. And new disclosure regulations are sure to come.

 

In this article, we’re looking at why compliance is crucial (beyond avoiding penalties for failure to comply) and how digital disclosure is a future-proof, scalable approach to disclosure that will ensure brands and retailers are prepared for whatever additional disclosure legislation lies ahead.

Why Accurate Disclosure is Crucial

Even if disclosure weren’t mandated, brands and retailers would be wise to implement transparency due to the many benefits it delivers. Here are five reasons why accurate disclosure is a smart move.

 

 

Disclosure is just as much about marketing and branding as it is about compliance. Consumers demand knowledge about the products they buy. Failing to comply creates a risk of falling behind in an increasingly competitive marketplace.

Why Digital Disclosure is the Ideal Method

Many companies are choosing digital disclosure as their method of compliance because it’s flexible, efficient, and future-proof. And with a strong vendor, you can dramatically simplify the compliance process. Here’s why so many companies are choosing digital disclosure.

1. Improve Profitability and Resources

Creating a digital disclosure is more cost-effective than disposing of packaging without the disclosure and printing new packaging. Multiplied over the number of individual products in your portfolio, these costs add up significantly. Leading brands report repackaging investments cost millions of dollars and hundreds of man-hours. In addition, the USDA estimates between 92 and 260 million dollars in printing costs alone for food manufacturers.6

2. Differentiate Through Digital Adoption

Consumers are doing more and more searching and shopping online. More groceries are being bought online now than ever before, and 90% of shoppers plan to stick to at least some of their new shopping habits post-COVID. If trends continue, online grocery shopping will account for 21% of all grocery sales by 2025.

As the world moves to digital solutions, regulations will increase. And customers will patronize the brands that offer transparency. By taking customer education and disclosure online, you make it more accessible.

3. Leverage Disclosure as a Growth Engine

A commitment to consumers to deliver product transparency is now a strategic initiative for many leading brands. 81% of shoppers say transparency is important or extremely important when it comes to their buying decisions. And when you offer one-click disclosure, you build trust and brand loyalty. By prioritizing customer education at a critical point on their path to purchase, your brand value increases.

4. Future-Proof

New regulations like those included in the NBFDS are sure to come. We’ve seen an increasing pace of new regulation as consumers demand transparency and safety. For example, within the last decade, the industry has had to make significant changes to comply with FDA Food Safety and Modernization Act (FSMA) regulations. With digital disclosure, you have scalable data intelligence that enables you to comply with new regulations quickly.

Digital Disclosure is a Competitive Advantage

As you can see, digital disclosure is far more than a compliance solution — it’s a competitive advantage that will deliver marketing benefits and position a brand for success in the future. And working with a strong data partner will empower brands to implement it easily and experience the benefits.

 

Read The Hidden Risks That Make BE Disclosure Business-Critical to learn more about digital disclosure and how you can use it to comply with the new bioengineered food disclosure law.

OR watch our webinar BE Disclosure: the Race is On on Youtube!

Share:

Subscribe