The Entanglement of Consumer Expectations and (Eco) Innovation Sequences: the Case Of

The entanglement of consumer expectations and (eco) innovation sequences: the case of orange juice

Foster, C., McMeekin, A., Mylan, J.

Manchester Institute of Innovation Research, Sustainable Consumption Institute, Manchester Business School, Manchester, UK

Abstract

Prospects for future innovation to reduce the carbon intensity of everyday consumer products rest significantly on the path dependent processes that have caused current products with their associated modes of provision and practices of consumption to be as they are. We use the history of orange juice to examine the dynamics of innovation sequences that have emerged to solve a series of ‘problems’ associated with the production and consumption of orange juice, the latest being the carbon problem. In particular, we focus on the interdependencies between consumer expectations of what constitutes ‘good orange juice’, changes in the product itself and in the system through which it is provisioned. We conclude with a discussion of how historical, path dependent processes lead to alternative framings of the new problem to be solved and different strategies for pursuing innovative solutions.

Introduction

The ecological impacts of goods and services sold for everyday consumption are now subject to intensifying scrutiny. Life cycle analyses have been conducted to identify where, in the chain of production, distribution and consumption, the major ecological impacts occur(Tukker et al 2005, Foster et al 2006). It is hoped that this new knowledge can be used to focus attention on where innovations could most effectively reduce these impacts, and many corporations have established programmes to reduce the greenhouse gas emissions associated with the goods they sell. But understanding the location of ecological hotspots is not sufficient in itself for these programmes to be successful. At least as important is an understanding of the social and economic processes which underpin innovation pathways and shape how they are likely to proceed. This involves analysis of the processes through which consumergoods have come to take their present forms and have become normalised and absorbed into practices of everyday consumption. Such analysisalso involves understanding the processes that have carried provisioning systems to their current states, in terms of technological infrastructure, the organisation and distribution of power across actors constituting value chains and their associated regulatory environments. In the case presented in this paper, the way that specific product qualities are established and how these come to be expected by consumers is of particular interest.

In this paper, we study the case of orange juice (OJ), which has become a normal part of everyday consumption across much of the (richer) world. We seek to establish how particular varieties of orange juice became dominant, certainly in the USA and UK. Specifically, how did OJ sold, stored and served chilled as not-from-concentrate (NFC) come to be the preferred form? This is significant for eco-innovation because chilled not-from-concentrate OJ carries higher environmental impacts – notably as measured by cumulative greenhouse gas emissions (“carbon footprint”) – than other OJ forms. We track the evolution of consumer expectations around specific qualitiesof OJ, including:

• its nutritional value
• the temperature at which it is sold, stored and served and the association of this with expectations of freshness;
• flavour expectations for ‘good’ orange juice and their relationship with perceptions of the degree to which the orange juice has been processed.

We highlight connections between this OJ specific process and some aspects of the widerdevelopmentof cultural conventions related to domestic food consumption in the West. We also examine dynamics on the provisioning side. How did OJ become embedded in the broader trend towards provisioning food through an integrated ‘cold chain’, relying on extensive investments in refrigeration technology for storage and distribution? How has the organisation of the value chain evolved so that certain actors have assumed dominant positions and can now be seen as focal organisations that can either block or instigate further ecologically-sensitive innovation?

Studying the historical development of OJ serves as a probe to better understand key social and economic dynamics at a more general level, particularly in relation to consumer goods. Orange juice has become a relatively mundane element of everyday life. We touch on some of the forces behind this normalisation, which is part of our interest. But if OJ is perhaps socially unremarkable, it remains of significant interest to retailers and food businesses as a consumer product; sales of packaged OJ across Europe exceeded 2 billion litres in 2003 (Euromonitor 2010) which represents around GBP3billion of retail sales at current retail prices. The 2 million tonnes or so of “embedded carbon” associated with this volume illustrates the scale of the environmental burden posed by this mundane consumption.

In the next section, we elaborate a conceptual framework for studying the OJ case, before turning to the case itself and an analytical discussion. By way of conclusion, we reflect on why the entanglement of consumers’ expectations and innovation sequences matters for understanding prospects for reducing the carbon footprint of everyday products.

Problem sequences, normalisation and evolving systems of provision

The ecological problems of today are the result of historical innovation trajectories that have carried provision and consumption systems to their current form. We build on the idea of problem sequences (Metcalfe and Ramlogan 2008; Gee and McMeekin 2011) to understand how OJ evolved into the form it takes today. From its introduction in the early 20th century in Florida, a massive global industry has grown around OJ. In that process, the product has changed significantly, as have the technical means by which it is produced, preserved, distributed and sold. Shifts in what consumers expect from OJ are associated with these innovations. As such, we can characterise the history of OJ in terms of innovation responses to “problems” associated with both changing “consumer expectations” and the development of a commercially viable OJ business. That the scaling up of a global system of OJ provision involved solving a series of problems – related to preserving, storing and transporting a perishable liquid over ever greater distances and at ever increasing scales - would seem fairly straightforward. The idea ofproblemsassociated with consumer expectations is perhaps a little more opaque, and the problems themselves more abstract. But firms producing and supplying retail goods must anticipate what consumers will need, want or desire.In the perspective adopted herefirms in the orange juice provisioning systemtranslate such anticipations intoproblems that can be solved through technological, organisational or marketing innovations, which in turn affect the product qualities considered to be important by consumers.We understand consumers’ needs, wants and desires as emanating from, or anticipated within the context of, the changing practices of eating and drinking. An outcome of this problem–innovation sequence is the emergence of new ‘qualities’ (Harvey et al, 2004; Callon et al, 2002) associated with what is considered to be good orange juice.

In the case of OJ, we find that the problems and the new qualities that emerge from innovation sequences have both objective and subjective dimensions and are therefore subject to reinterpretation as understandingsevolve. These problems therefore endure and interact with each other and we find it useful to think of them as forming a “problem space”. The problems that form the space are rarely fully solved, and are “solved” differently for different groups of consumers, leading to observable patterns of product differentiation and tied to heterogeneous practices of consumption. These partial solutions themselves contribute to the evolution (re-definition) of consumer expectations, while allowing for subsequent re-interpretation of the problems by later innovators. Isaiah Berlin noted that “any study of society shows that every solution creates a new situation which breeds its own new needs and problems” (quoted in Metcalfe 2001, p.561), and here we regard the different forms of OJ as representing different “situations” in Berlin’s sense.

In other words, each partial solution within the problem space simply renews the search for further innovations, while, over time, new knowledge becomes available to create innovations that solve one or more of the problems in new ways. The evolutionary dynamic thus created allows us to characterise the history of OJ in terms of efforts to solve the problems of preserving a perishable product, achieving a desirable flavour, distributing the product over large distances, delivering nutrition and providing convenience and pleasure. An additional layer of complexity results from the interdependent nature of the problems; for example processing for preservation purposes can have detrimental effects on flavour.

Considering the acceptance of OJ over the past 80 years as an everyday product, we see analogies with other detailed studies of the embedding of food and drink products in consumer culture over long time frames, for example those of sugar (Mintz 1985), and tomatoes (Harvey, Quilley and Beynon 2002). More broadly, our focus on flavour, temperature and nutrition in the OJ case has clear connections to accounts of how the cultural conventions of comfort, cleanliness and convenience emerged in relation to laundry, showering and eating practices (Shove 2003; Shove and Southerton 2000; Hand, Shove and Southerton 2005; Pantzar 1997). Our analysis of how specific qualities of OJ became normalised draws on several types of data: first we use sales dataandmarket analysis reportsas evidence of the relative enthusiasm with which consumers have responded to the different forms of OJ made available by producers; second, we use historical evidence about the marketing strategies and the product marketing material of the key firms to establish the qualities that they anticipated to be important for consumers; finally, we contextualise the OJ story using more general historical material on the development of household food and drink consumption practicesover the twentieth century.

We also analyse the changing commodity-centric system of provision (Fine and Leopold 1993) that connects the production and consumption of OJ. This approach suggests that the structure of ‘vertical’ commodity chains creates a unity of social and economic processes linking the logics of production and consumption in specific ways for particular commodities. These “unities of processes” can also be seen in the Global Value Chains (GVC) analysed by Gereffi et al (2005), who stress the spatial distribution of commodity chains and the distribution of economic power across the actors that constitute them. We are particularly interested in how chains of production, distribution and retailing have evolved to confer greater power on some actors than others. We suggest this is important because powerful, incumbent actors may well exert considerable influence on the prospects for future eco-innovations. We term those powerful, incumbent organisations possessing buying power that can be mobilised to orchestrate (or block) system innovation “focal organisations”.

Practices of consumption and systems of provision are interwoven with technologies. These connections constitute a core part of what are described as socio-technical systems which can remain dynamically stable over long periods of time (Rip and Kemp 1998; Geels 2002). This leads us to question how, and to what extent the actors and technologies that constitute socio-technical systems have become entrenched and locked-in to particular pathways of development (Unruh 2000) and how such lock-in can be escaped (Cowan and Hultén 1996). Hughes (1983) described how systems can gain momentum along particular trajectories and in this paper we focus on specific aspects of the dynamics that generate such patterns: namely, how the co-evolutionary feedback that occurs between practices of consumption and provisioning systems creates momentum around certain qualitiesof OJ as a product, entrenching a particular system of provision - and an associated configuration of the “problem space”. Breaking out of such a position can be disruptive and challenging for consumers and producers; the emergence of ecological problems may require such a response, by virtue of the changes they bring to the problem space.

The Story of Orange Juice

This section recounts the history of orange juice (OJ), which is presented in a sequence of five eras. For each era, changes occurring in production methods, consumption patterns and the form of the product are described. The description is selective, focusing on changes that have contributed to momentum or stability in particular consumer expectations associated with OJ, the technologies used to produce and distribute it, the nature of the product andthe relative power of particular actors in the system of provision.

From Fruit to Juice: 1910-1940

The processed OJ sector was born in Florida soon after the end of WW1 in response to problems associated with increasing supply in the market for oranges. These problems became an opportunity for orange growers, leading to diversification and the development of a complementary product sector. Initial developments aimed to make use of ‘eliminated’ oranges: those of the wrong size or quality for sale as fruit. The significance of ‘eliminated’ oranges grew in parallel with orange production in Florida and orange consumption throughout the USA. So the first OJ production plants were opened by orange grower-packer cooperatives to deal with this wasted fruit[1]. The first processed OJ was boiled, concentrated, canned and distributed at ambient temperature for home dilution. Although at this time it was the only widely available processed juice, it accounted for a very small proportion of orange production (Hamilton 2009) and its flavour bore little resemblance to that of just-squeezed oranges (Hamilton 2009; Morris 2010). Rising orange production and concern over the devaluing of fruit elicited an alternative response from another group of orange growers. In the mid-1920s the Florida Citrus Exchange, a cooperative of orange growers, distributed orange juice extractors throughout the USA. This programme equipped 16,000 households with juice extractors between 1924-1926 (Hamilton 2009) and represents the first systematic effort to stimulate OJ consumption, in this case on behalf of the orange growers of Florida.

Further impetus for developing the OJ market came in the 1930s with rising concerns about vitamin intake and nutrition among US citizens (Fernández-Armesto 2001). This represented an opportunity for juice producers to develop the fledgling market, by capitalising on its vitamin C content. This aligned juice producers with the trend in the wider American food industry of increasing capacity to supply more nutritious foods. For example, quick-freezing of white fish and green vegetables had been introduced (Cox, Mowatt and Prevezer n.d; Coppock 1978), preserving more nutrients and more flavour than competing preservation techniques (Friedland 1994; Shove and Southerton 2000). The 1930s also saw the introduction of a chilled concentrated form of orange juice in addition to tinned juice. This helped to create demand for refrigerated railway wagons operating at lower temperatures than were achievable with the prevailing ice-cooling technique (White 1986). The capacity of the US consumer to accommodate chilled products was on the rise too, with a refrigerator present in 50% of US households by 1938 (Bowden and Offer 1994). By the end of the 1930s, 20% of Florida oranges were being processed, representing a tenfold increase over the decade (USDepartment of Agriculture1945).

The miracle product: Mid-1940s-1960s:

Following the Second World War, OJ production and the wider refrigerated food systemcontinued to grow together. The mid-1940s saw the development and commercialisation of a process for producing frozen concentrated orange juice - soon to become known as “the miracle product”. This was a turning point for the industry and by the beginning of the 1960s the volume of OJ produced in Florida had increased by over 500 times: from 226,000 concentrate gallons in 1945/6 to 116 million concentrate gallons by 1961/2 (Florida Canners Association 1963 in Morris 2010). Frozen concentrated OJ accounted for the vast majority of consumption: 70 million gallons according to White (1986).

Compared to the earlier tinned version, the flavour of frozen concentrated OJ far more closely resembled that of just-squeezed juice (Morris 2010). The product was quality-stable when kept cold, so requiring both distribution to consumers and home storage in its frozen form. This development clearly established for the first time an association between the logic of OJ processing and consumer expectations about what constitutes ‘good’ orange juice. By the late 1940s, ‘cooling’ infrastructures were becoming well-established in both the US food provisioning and food consumption domains. Three quarters of US households had a refrigerator (Bowden & Offer 1994) and refrigerated railcars with mechanical refrigeration plantinstalled had been introduced[2]. The further spread of other refrigerated food products, such as those from Birdseye’s quick freeze process, helped to support the development of this infrastructure (White 1986).

In general, marketing campaigns for packaged foods in the US intensified during the first half of the twentieth century (Strasser, 1989) and OJ was no exception. Both generic and branded marketing campaigns promoted the health benefits, naturalness, affordability and convenience of frozen concentrated OJ; it was these qualitiesthat led to its description as “the miracle product”. The Florida Department of Citrus (FDC), an agency of the state government established in 1935 to protect the interests of Florida orange growers, sponsored wide-reaching generic advertising campaigns. Early marketing programmes run by Florida Foods (later to become Minute Maid) included radio advertisements featuring that icon of American wholesomeness Bing Crosby, as well as door-to-door product demonstrations. In addition to its marketing activities the FDC coordinated research into citrus growing and processing, and passed regulations to promote improvement in juice quality (Morris 2010), so stimulating incremental improvements in the “cut-back” process[3].

Over this period, OJ became a leading seller among food products in the US (Morris 2010). However its suggested qualitiesof “naturalness” and “freshness” were absorbed and perhaps unquestioningly assumed by US consumers to such an extent that in 1961, the US Food and Drugs Administration intervened on the basis that consumers may not properly understand the characteristics of the product they were drinking. Following “Standards of Identity” for OJ, US juice processors admitted that use of the word "fresh" on juice products was inappropriate and removed it from their packaging (Hamilton 2009). This represents a key moment of intervention in the process by which OJ came to be associated with particular consumer expectations, highlighting the contested attribution of specific ‘qualities’ to the product.