GMA’s CEO talks about the need to unite the food and beverage industry – Food Dive

Few trade groups in the food and beverage space have amassed the clout of the Grocery Manufacturers Association.

But in 2017, the trade group lost some of its luster as several prominent members — including Hershey, Tyson Foods, Nestlé and Campbell Soup — left the organization, saying its views on important issues appeared to diverge from the stance portrayed by GMA.

Today, the 111-year old association is working to rebound from this rough patch by adding new staff, moving its headquarters from downtown Washington, D.C. across the Potomac River to Virginia and making other changes to improve its communication and public perception. But the biggest and most important move came last summer when GMA announced that Geoff Freeman would be taking the helm as president and chief executive officer on August 1. 

Freeman is no stranger to heading trade groups. He came to GMA from the American Gaming Association, where he was credited with modernizing the group, creating consensus on key issues and working to get sports betting legalized nationwide. Prior to that, he was the chief operating officer at the U.S. Travel Association, where he helped pave the way for the creation of the TSA PreCheck program.  

In an hour-long interview with Food Dive, Freeman said his time at GMA has been “an eye-opening experience.” He has focused on identifying four key principles that are valued by GMA’s members and acknowledged that the association can’t be “all things to all people” — a problem that he said plagued it before he arrived. Freeman also touched on SmartLabel, the need for uniform regulations and priorities for GMA in 2019.

The first part of the interview is transcribed below and has been lightly edited for continuity. Please read the second part on Thursday to hear more from Freeman on the trade group’s new emphasis on the supply chain, his priorities for the coming year, and potential bigger changes ahead. 

What have you learned about GMA since you took over?

FREEMAN: It’s been an eye-opening experience over the course of that time, and I think the benefit I have coming from outside of the industry is no real bias, no prospective set in stone, just a career based in leading associations, finding consensus, developing common cause and getting things done. So it’s certainly leading me to probably ask some questions that haven’t been asked for a while at GMA, and probably a willingness to draw some conclusions and do some things that others might think are heresy.

I think what you see shaping up is a much different organization than you’ve probably seen in the past. And I think what you’ll see in the future is an organization that is much, much more effective. An organization that is capable of leveraging the powerful brands that are in this industry to get things done. I think in the past we’ve been punching below our weight class quite considerably and we’ve got an opportunity to build this into one of the powerhouse associations in town.

What are some of the questions you’ve been asking at GMA? What have you noticed as an outsider?

FREEMAN: The two biggest questions that I’ve been asking is one: who are we? And, two: what is it that we care about? What is it that binds us together? As I came into the organization, what struck me was the diversity of the membership, ranging from consumer-facing brands to the entities that are primarily private label or are primarily food service, other entities that were at different points in the value chain, agricultural interests and so on. A lot of supplier interests. And just kind of, frankly, a hodgepodge collection of a lot of folks generally interested in consumer packaged goods. By the end of the day you got to know who your core is, and I’ve been trying to figure out who is our core, what is it that wakes us up every day and becomes our true north.

The other one, as I said, was what is it that binds us together? … My instinct coming in was that it was an organization getting spread too thin with probably non-food interests. What was so striking to me is I met with leaders in the industry whether or not they were selling food, be it cereal, bread, canned items, or whether they were selling beverages, household products, personal care, whatever it may have been. When you speak with the C-suite, the issues that keep them up at night are relatively consistent. And it pointed out for me an opportunity to build something that the C-suite needs that is fundamentally different than that which existed.

What are the issues that keep you up at night?

FREEMAN: The first question is who are we? I think we may need to make a very clear determination that who we are is a (collection of) consumer-facing CPG companies. That’s who we are. I think that consumer-facing CPG companies tend to be confronted with the same issues day in and day out. They tend to have similar interests, similar risk tolerances, similar areas of pain, similar relationships with consumers and customers that need to be navigated. What is it that they care about?

There are four things that we’ve identified. One, they care about a frictionless supply chain. That is at the top of the list. You can’t speak with these companies, you can’t listen to an earnings call without understanding that getting that product, primarily from the manufacturing facility into the consumer’s hands, is where so much cost and inefficiency is associated. It’s where profitability in many instances is determined.

Two, the issue of packaging sustainability. Across the industry, it’s embraced. I know it’s embraced because 100% of our 25 biggest companies have all made commitments in this space. This is an area where people recognize that we have a responsibility as an industry that perhaps is different than that which was recognized in years past, but an area we’re going to need to be focused for the foreseeable future. You know, packaging is our middle name. What are we going to do about packaging? How are we going to ensure that we meet consumer demands, that we drive informed public policy? That’s an area of huge opportunity.

Three is an opportunity to build greater trust around consumer packaged goods, around the products. We are an industry of chemistry and complex science and hard to pronounce words and names and ingredients at a time when people are getting information in the most concise and rapid way possible, through their phone, through a blog, through what someone said to their aunt, who told somebody’s mother, who told the cousin that you shouldn’t buy something with this ingredient. How do we balance that? How do we build greater trust, greater, I think, resilience in the system so we’re not dealing with panic, we’re not dealing with fear despite access to more information. How do we build greater trust in the system, build greater trust in our industry’s commitment to the health and safety of our customers? That’s a critical area.

Then the final thing I’d mentioned is smart regulation. … GMA will stand as a champion for smart regulation. What do I mean by smart? The industry, an industry of this scale, simply doesn’t work when we’ve got one policy in California, a different policy in Vermont, a third policy in New York. It doesn’t work for the industry. It doesn’t work for consumers. It doesn’t work in terms of keeping costs down, increasing access, driving innovation. You know, we need uniform standards when it comes to regulation. The state by state approach is the death knell of the industry in many respects. We need a policy that is effective in terms of its durability, in terms of a reasonable implementation. We need policy that empowers consumers to make informed decisions. Take a look at the new (bioengineered) rule. That does not empower consumers to make informed decisions. It did nothing to help the consumer.

GMA appears to have a lot of companies whose interests may not always be the same. How are you working with these companies without alienating those members who might have different interests?

FREEMAN: I actually think we’re getting to a point where we don’t have that many distinct interests. If you embrace that who we are is consumer-facing CPG manufacturers and the interests at Smuckers are very similar to the interests at Procter & Gamble, are very similar to what the interests are at Clorox, at General Mills, at PepsiCo and I think Anheuser-Busch, Miller Coors, L’Oreal and others. Those four pillars that I just outlined are four pillars that outline all consumer packaged goods companies.

How do we help them drive profitability, grow their business? So I actually think to your question, there is more synergy than ever before. Where I think we may have gotten misaligned in the past was when we played the role of not an umbrella but of a vertical, you know, the name of your organization. The (National Confectioners Association), the Beverage Association, the Sugar Association, SNAC, (the American Frozen Food Institute.) These are verticals. They have their issues and they need to serve the individual interests of those sectors. Where we get in trouble is where we try to do that with a diverse membership. But if we focus on that which aligns consumer packaged goods, there is immense opportunity.

This is where I think the GMA of the future is, you know, somewhere in between the dozens of vertical organizations that represent every interest you can imagine in consumer packaged goods and the major business organizations of the (U.S. Chamber of Commerce,) (National Association of Manufacturers,) (Business Roundtable,) and so on. There is a massive white space for an organization that wakes up every day and says, “How do we drive greater profitability within consumer packaged goods? How do we enable this industry to grow? How do we develop greater trust?” That, to me, is the opportunity that no one has filled in years past. It is vastly different than perhaps what your image of the GMA of the past was.

What was the perception that people had of GMA and how are you going about changing that?

FREEMAN: In our zeal to provide members with the benefits they sought, we were all trying to be all things to all people. So GMA tended to be leveraged for a lot of parochial interests. …Trying to respond to those needs is the fastest way to drive the car over the cliff. You can’t be all things to all people. Your job as an association is to immediately identify that which unites the industry. That’s our responsibility. That’s a big shift because for years people found that “I’ll get GMA to fight the fight of my interests.” … When you’ve got an association where two-thirds of the members at all times saying, “Not my problem,” then we’ve got a big problem and GMA confronted that. We’re building an organization that (looks at) what do we all have in common. As I talked about supply chain, packaging, trust, smart regulation, that unites all of us and that’s what we’re going to be focused on.

What have you been able to take from your prior trade group experience and how have you been able to integrate it into GMA?

FREEMAN: One is recognizing that in all industries, there’s more that we have in common than that which divides us. Industries tend to get caught up in what divides us. And we’ve seen that, of course, in this industry on sugar and sodium, a host of other issues. Every ounce of energy you’re putting into what divides us is energy you’re not putting into pursuing that which we have in common. …  I’m not going to waste time over here on that which divides us. What we have in common is that we want to, and this is what every association in every industry has in common, we want to grow.

Every artificial constraint that we remove for an industry with this kind of scale, that constraint, maybe a penny here or a penny there, but what that adds up to is extraordinary differences in the bottom lines for these companies and their ability to keep products affordable for their customers, their ability to invest in innovative products. That to me is opportunity. That’s growth. Where else does that growth come from? That’s the question we’ll be asking. It’s a different question than many associations answer or ask, but I will tell you the asking of that question in every industry captures the imagination of leaders and it’s leaders that we need to have invested in GMA. It’s the leaders who are helping us build this agenda right now and who are excited about the direction that we’re going.

What are some things GMA has been involved in in the past that you would avoid going forward?

FREEMAN: I’ll give you a couple of things. … We are not here as the broad representative of the consumer packaged goods industry to fight for soluble nickel. I’m sure there is a constituency and a coalition of interests that really care about that, but an individual ingredient fights, we’re not here to fight those battles. Yeah, there may be issues within that. I’ll give you an example on sugar. I’m not here to defend sugar, but New York City’s approach to drive sugar reductions is exactly the wrong way to go.

 

We have an FDA for a reason. If we want to have a discussion about sugar reduction, that’s where it belongs, at the national level if we want to protect the scale of this business. If we’ve got individual municipalities creating different standards it’s absolutely going to undercut the business, increase costs, decrease innovation and decrease access to products. So, I’m not there to engage on the ingredient. I’m there to engage in what we talked about before, smart regulation. Nutrition is an area where I don’t see a great deal of upside for GMA being engaged. The most important thing we need to do is unite the industry. When it comes to an issue like nutrition, I know we’re united around portion control. I know we’re united around healthy lifestyles as we should be, but I struggle to see where that unity continues.

And I think the act of any association picking winners and losers, we talked about that before, is the kiss of death. We’re going to be focused on where unity exists. … That doesn’t mean you got 100% unanimous point of view on this issue and that issue. It doesn’t mean that you’re a lowest common denominator organization, which some fear. It means you have to drive consensus sometimes. It means you need to tackle big issues. It means you need to bring the industry along, provide the information they need and sometimes make tough decisions. That’s been our experience at every industry I’ve been a part of.

What big issues in the food space will GMA be involved with going forward?

FREEMAN: Traceability is a massive issue. We can get caught up everyday on things that divide us … or we can realize that there’s a 64,000-pound gorilla here called traceability where there’s going to be a huge focus and it’s going to involve multiple agencies. Governments are going to expect more of us. Consumers are going to expect more of us, and we need to lead the charge for all of consumer packaged goods. That’s the type of thing where I think we can make a meaningful difference.

One of GMA’s big initiatives had been SmartLabel. Is that something you will continue to focus on going forward?

FREEMAN: We’re heavily invested in SmartLabel. I think SmartLabel is a great tool for consumers, for customers, for manufacturers and other interested parties. I’ve been fascinated by it. I like to see how different companies use it in different ways. It shows the industry’s commitment to digital disclosure and you know, there is a subset of a population that is looking for a lot of information that can’t fit on any container. We all have to face that. So what are the alternatives? I think it’s great that the industry came together, joined at the hip in terms of how we will provide this information. Doing it in a way that doesn’t provide any one company with a competitive advantage. I think the industry deserves great credit for its investment in that and GMA will only continue that investment.

Several large members left GMA a few years ago. Have you made any overtures to those companies since you came on board?

FREEMAN: I’ve spoken with just about every company that has left GMA. I’ve spoken with many companies who’ve never been a part of GMA. The agenda that I’m putting forward is an agenda that’s informed by companies across the consumer packaged goods industry, many of which are within GMA today and many of which aren’t. We’re trying to build an organization that provides the industry with extraordinary value. And to do that, you’ve got to listen. You’ve got to pay attention to what’s on people’s minds, what keeps them up at night. And those are the questions I’ve been asking of all of those companies. And I really appreciate their willingness to provide that information. There’s no doubt that there are hard feelings out there and it’s going to take time and we’re gonna have to prove that we are who we say we are. But I can tell you that I have, based on the conversations I’ve had, I am extremely confident that when we demonstrate that we can deliver on this new value proposition, you will see a GMA membership that is broader, more diverse and more united than you’ve ever seen it before.

Are you confident you won’t see the departures like GMA did a few years ago?

FREEMAN: Every industry has its challenges. Every industry runs into those pivotal moments where you’ve got to make a decision. GMA kind of crossed a point of no return. They crossed the bridge you don’t cross in terms of picking winners and losers, in terms of engaging on issues where we failed to drive a more united point of view in the industry. And what I can assure you of is we won’t be doing that. We are an organization that will be immensely skilled and driving consensus at creating a focus on a core set of priorities and … as a champion of consumer interests. This is something that was really telling to me. It is a privilege to represent the brands that we represent everyday. And to the extent that we have those brands and our membership, we’re also holding a responsibility for protecting those brands. I think what the industry has done in many respects has been pursuing policy that is in consumers’ interests, but has fallen short in communicating why a lot of these things are in the consumers’ interests. That needs to be our cause, our responsibility going forward if we’re going to effectively represent these brands.

You look back on an issue like GMOs where you got to the right outcome, but you got there maybe the wrong way, and you didn’t get any of the benefits from getting there, right? At the end of the day, creating national policy about GMOs was exactly what needed to be done, and we think consumers’ interest was there. It’s remarkable and it should be a case study for the industry. How did we do this thing that was in consumers’ interests, and yet took such a beating along the way? How do we learn from that, and [take] the lessons from something like that and form the organization that we’re talking about?