“We Need To Move Prices Up” Says StarKist CEOff

Source : Intrafish

You get what you pay for in life, said Inn-soo Cho, the top executive at Dongwon Industries-owned Starkist. American consumers are paying too little, so are getting poor quality products in return.

“The pricing of the tuna category is by far the lowest in America and it is not sustainable. We need to move up,” said Cho, a veteran of Procter & Gamble, and Pizza Hut parent Yum Restaurants International, who joined as president and CEO of StarKist in early 2011.

The company is taking action to remedy the cheap prices of tuna in retail, he said, after taking a hit in 2011 as skipjack prices boomed to over USD 2,000 (€1,502) for a metric ton.

“We had a tough year and we have taken a lot of price increases and the price of commodities being too low,” he said. “We are fixing it and retailers do understand - it is a win for us, a win for them, and a win for consumers.”

Consumers get what they pay for, he told IntraFish. “The tuna industry is not going to offer a low-priced and quality product and lose money on it.”

So, what consumers in the US get is a low quality product. In fact, this product has got worse over time, said Cho.

“If you look at it, some of the product in the can is not acceptable quality. StarKist is a firm believer in high quality, premium products and giving a value product to the consumers,” he said.

StarKist has invested “double digit” millions of dollars into improving the quality of its products, which Cho claimed are better than its competitors, such as Thai Union Frozen Products-owned Chicken of the Sea and Bumble Bee Foods.

“If you open canned and pouches, compared to our competitors, we are the best. I can vouch, ten out of ten times; we will come out on top,” he said. “It’s, hands down, a better-quality product.”

Cho plans to turn tuna into a preferred protein for consumers again.
Part of the reason for the position of tuna in the US now is a lack of innovation and advertising spend, he said.

“What has happened over decades in the tuna business, particularly in the US, is the industry has not invested in the product and they have not invested in the marketing.”

StarKist has started advertising again and Cho is looking across the Atlantic at the branding of Princes and other European canned tuna processors, he said.

“I have looked at some of the adverts in the UK that Princes and others are doing and they are doing the right thing, they are talking to the consumers, quality of products, talking about brand,” he said.