Day 13: Terroir

Today, we had one of the most interesting lectures from the ESA staff yet! We learned about the concepts and definitions of food quality in Europe. We learned about traditional v. typical food products, leading to Terroir v. food products in general. The concept of "Terroir" is difficult to understand at first. In a nutshell, Terroir food is traditional food that embodies a strict set of production methods, ingredients, quality of ingredients, and regional production specific to that type of product. Originally, Terroir was used for wine products, but its meaning has expanded to all sorts of food products. In wine, terroir was used to represent a "local taste" from the vineyard, which embodied the weather and local environment specific to where the wine was produced. This also embodied the human factor that went into the production of the wine. For example, Champagne is actually a region in France where champagne, the sparkling wine, originated from. In the EU, for a product to be called "Champagne", it must have followed a strict set of guidelines set my the government and actually be produced in that area; champagne. Since the 60s, marketing standards have developed dramatically in the EU for the benefit of protecting the farmer. As a result, a number of "quality signs" have developed that appear on packaging of EU products. The main, and most used, signs are that of Protected Designation of Origin (PDO), Protected Geographical Indication (PGI), Traditional Speciality Guaranteed (TSG), and the Organic Label. Each of these signs of quality has a respective label that appears on food and beverage packaging. To get the rights to use these labels, farmers go through an extensive process with the government to ensure that their product meets the standards set for that specific region. The effort behind the farmers in doing so, surprisingly, is not to increase their margins or sales volume, but rather to have a good reputation in the market for having a "high quality" product. I thought this was interesting since many farmers wanted no economical benefit from the label, but rather a higher reputation for their products. This branding method allows consumers to select authentic and traditional products that are linked to specific territories. I would be interested to see if a program like this would work in the US, but then again, do we really have regional products that are specific to certain territories? Crawfish from Louisiana, Brisket from Texas, Lobsters from Maine, Wine from Napa? We actually found out that wine from Napa sold in Europe has a PDO label that allows consumers to know that it truly was produced in the Napa Valley of California. I'm pretty interested in the system's concepts and how it affects a product's price premium and a consumer's decision making when faced with the two products on a shelf (i.e. Champagne), one produced in the region, and one produced elsewhere. Do they want to pay the premium for the "real deal"? Do producers have a greater market power with this branding method that allows them to set price premiums? I guess i'll have to get started on my research paper to find out!