HM Insights

A Fruit & Nut case: intellectual property, taste and the power of brand in Food & Drink

The news that Cadbury is altering the recipe of its eponymous Fruit & Nut by adding sultanas to the chocolate bar as well as raisins has caused an outcry from many consumers.

The official reason put forward by the company is that the inclusion of sultanas in the recipe will "add more variation", but they do acknowledge that it will "ensure it's still an affordable treat". It is this latter explanation which has caused some chocolate lovers to accuse Cadbury of putting cost – sultanas are cheaper than raisins – ahead of taste.

Food And Drink Chocolate Brand Intellectual Property

Cadbury, however, has countered this by stating that in tests which they have carried out only 10% of people could tell the difference between the old and new recipes.

What’s in a name?

This issue highlights the various intellectual property rights which food producers have in their products.

Cadbury is, of course, one of the most well-known brands, but in addition to having the "Cadbury" name registered as a trade mark, the product is protected by a number of additional registered trade marks:

  • "Dairy Milk"
  • The glass and a half logo
  • "Cadbury's Fruit & Nut"

Fruit & Nut itself is not registered as a trade mark as these words can also be viewed as a description of the actual product and so would not, until there has been substantial use and so the words are regarded as synonymous only with one producer, be accepted by the UK Trade Marks Office as a trade mark – and although the product has been in manufacture for over 90 years "Fruit & Nut" itself remains unregistered.

Food producers are, of course, very aware of the power of a brand and the protection which can be given from registered trade marks. But in addition to this, many will rely on protecting their recipe for the product, perhaps most famously Coca-Cola and, in Scotland, Irn-Bru. But there is always a danger that either a disgruntled employee will pass the recipe on or that another manufacturer will be able to break down the product and recreate the recipe.

Taste or brand – what is more important?

It remains to be seen whether consumers will notice the taste difference to any material extent and, even if they do, whether this will affect sales or will be simply accepted and consumer tastes change.

Whatever our loyalties might be, taste can be as much a perception of the brand than a chemical reaction as is known, and indeed emphasised, by many retailers. The discount supermarkets now make a selling point of their, cheaper, products tasting the same as better known brands. And as we approach the Christmas season we shall shortly be hit by all the consumer tests of what brand will taste best – be it mince pies, Christmas puddings or champagne.

Having changed the recipe of its Crème Egg earlier this year, without, it would appear, too much ongoing consumer backlash (despite protests at the time) it has to be assumed that after some loud objections (especially on social media) the same will occur for the Fruit & Nut bar.

This illustrates the balance of power, which is available to successful producers and also retailers in not so much tailoring their product to meet consumer demand, but tailoring consumer taste to meet their product. It will be interesting to see if, in a few months time, many people could tell the difference between the "old" and "new" recipes. And if in fact those who claim to be able to do so were correct!

Scottish Food & Drink – a recipe for successful business

That, of course, is fine for established brands, but for many smaller producers of food products, taste and quality control is essential to ensure consistency and public support. For an established brand like Cadbury, the brand can lead the consumer; but for smaller producers, they do need to win the consumer over first.

Many producers in Scotland rely on the "Scottish" back story of local and natural ingredients to enhance their appeal to ever-more sophisticated consumers and as Scotland's Year of Food and Drink draws to a close, increased sales of Scottish produce are testament to the success of this marketing ploy.

Given the good news story of Scottish food exports, we wait to see whether any of these Scottish producers will become the next Cadbury. And if they do, whether they might in turn think about adapting their recipes

Scott Kerr is a Partner with Harper Macleod LLP and Head of its Food and Drink practice.

 

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