{"id":13252,"date":"2024-09-05T18:20:58","date_gmt":"2024-09-05T18:20:58","guid":{"rendered":"https:\/\/dmsretail.com\/RetailNews\/ai-comes-to-expo-west\/"},"modified":"2024-09-05T18:20:58","modified_gmt":"2024-09-05T18:20:58","slug":"ai-comes-to-expo-west","status":"publish","type":"post","link":"https:\/\/dmsretail.com\/RetailNews\/ai-comes-to-expo-west\/","title":{"rendered":"AI Comes to Expo West"},"content":{"rendered":"

\"Retail<\/a><\/p>\r\n

By: Matthew Adam Smith<\/p>

Applegate\u2019s Mission to Revolutionize the Food Industry<\/h3>

To the uninitiated, Natural Products Expo West might feel like a cross between the world\u2019s largest Whole Foods on steroids and the Disneyland located just across the street. The undisputed trade show king of the Wellness space, it draws thousands of pilgrims to the Anaheim Convention Center every spring, each in search of the next big thing in natural, sustainable, and organic products\u2013and with the fervor of a Swiftie. This year, I joined more than 67,000 earnest idealists and corporate strategists, and over 3,300 companies, for the three days of the year that will chart the course of an industry projected to surpass $300 billion in annual sales.<\/p>

For Joe O\u2019Connor, President of Applegate, this year\u2019s show was a unique moment in a career spent leading sales at some of the biggest names in Big Food. This was the year that Applegate released their first-ever Mission Report<\/em>, an impressive accounting of the company\u2019s longstanding contributions to sustainability and organic foods, and an aggressive plan to radically up the ante by accelerating their push into regenerative agriculture.<\/p>

When I met Joe on the show floor and he mentioned AI within the first 30 seconds, my initial skepticism quickly vanished.<\/p>

\u201cThe future of our food is regenerative, and AI will be central to making it happen,\u201d he said. The Mission Report<\/em> isn\u2019t your everyday glossy virtue-signal; it\u2019s a manifesto outlining Applegate\u2019s comprehensive approach to regenerative agriculture, sustainability, and even their DE&I initiatives. As O\u2019Connor succinctly puts it, \u201cWe\u2019re changing the meat we eat.\u201d Applegate is striving to move not just their own company, but an entire industry, beyond the legacy monikers of \u201corganic\u201d and \u201cnatural,\u201d pushing towards a food system where regenerative agriculture is at the core.<\/p>

To Joe, \u201cregenerative\u201d is more than just another buzzword in the corporate lexicon\u2013it\u2019s a comprehensive and far-reaching approach focused on restoring soil health, biodiversity, and ecosystem functions while ensuring profitability across a value chain that stretches from the farmers all the way to your kitchen table. It\u2019s a position clearly supported by the recent Deloitte report, Unleashing Sustainable Value in Food & Agriculture<\/em>, which revealed that 98% of food and agriculture companies experienced financial value from sustainability investments, with 79% experiencing at least 2% revenue growth and 74% reporting cost reductions.<\/p>

Applegate\u2019s \u201cDo Good Dog\u201d was an important test of this hypothesis: an all-natural hot dog made from grass-fed beef raised on verified regenerative grasslands, which has seen massive uptake by consumers. Up next, the company has committed to transitioning all its hot dogs to 100% beef sourced from verified regenerative grasslands by 2025, while also working to scale up regenerative sourcing across other species and product categories. O\u2019Connor admits the immensity of such an undertaking: \u201cIt\u2019s the right thing to do, but it requires a completely new approach to our supply chain and retail partners.\u201d It\u2019s a feat that will surely require an even greater coordinated effort than was made in the organic space these past several years.<\/p>

So where does AI fit into all of this? The ability to accurately forecast demand and inventory helps companies of all kinds minimize risk and improve efficiency, and Joe believes that predictive modeling through AI will play a massive role in scaling regenerative agriculture practices. \u201cPredictive AI can help us understand how far we can grow this business. It\u2019s about reducing liabilities for both manufacturers and retailers,\u201d he says. And he\u2019s not alone. According to the Deloitte report, 72% of food and agriculture companies believe that AI can help improve inventory management and reduce waste.<\/p>

Companies like Regrow AG are integrating AI software with hi-tech hardware at the farms, where \u201cIoT\u201d (Internet of Things) sensors in the field are increasingly allowing farmers to gather real-time data on soil health, moisture levels, and crop growth, enabling more precise irrigation, fertilization, and pest control. Per Deloitte, 65% of food and agriculture companies see opportunities in deploying AI and IoT together for better demand forecasting and crop production, resulting in improved yield and reduced environmental impact. And 79% believe that integrating AI into regenerative agriculture practices will contribute to better financial returns in the long run.<\/p>

Across the food value chain, AI is enabling \u201cfoodtech\u201d companies like NotCo to formulate plant-based foods with the taste, texture, and smell of their animal-based counterparts; Strella to sense and predict produce shelf life, increasing freshness and reducing shrink; and Planet\u2014>FWD \u00a0to provide granular data about a product\u2019s climate footprint at the supplier, ingredient, or even farm-level. \u201cIn many cases, AI and machine learning are breathing new life into existing technologies\u2014increasing efficiency, effectiveness, or enabling greater speed or scale,\u201d says Keith Anderson, founder of Decarbonize.co.<\/p>

But it\u2019s not just about the tech. Collaboration remains central to scaling regenerative agriculture. Deloitte estimates that 84% of companies are currently co-investing with partners across the food value chain to fund their sustainability strategies, and 43% are doing so with upstream suppliers. Applegate partners with organizations like the Savory Institute and Land to Market to build sustainable supply chains and source regenerative products. They also invest in small-scale farmers through partnerships with the American Farmland Trust, providing them with loans to support their shift to regenerative practices. On the need for cooperation across the food industry, Joe takes the long view, saying, \u201cWe\u2019re all better off if we build these systems together. It can\u2019t just be about rivals competing for market share; it\u2019s about an industry-wide alignment that\u2019s critical to ensuring the longevity of regenerative practices.\u201d<\/p>

Encouraging wholesalers to extend hands across the aisle is one thing, but driving real change also means winning over both retailers and the end consumers. O\u2019Connor stresses the importance of aligning with retailers\u2019 corporate goals to capture their attention amid the daily influx of sales pitches retailers face. \u201cWe\u2019re sharing our innovations early and developing long-term planning together.\u201d<\/p>

While \u201cnatural channel\u201d leaders like Whole Foods and Sprouts have long been core doors for Applegate, partnerships with mass big boxes like Walmart are a more recent evolution, as they have expanded their assortments to include more niche offerings and price points, and added operational capabilities to handle the shorter shelf life of natural products. Outside of brick-and-mortar, Applegate also leverages e-commerce channels like Instacart, where they\u2019ve found extreme loyalty among natural and organic consumers. \u201cOur partnership with Instacart helps us reach loyalists, but it also drives broader consumer education on sustainability,\u201d O\u2019Connor says.<\/p>

Perhaps the most novel aspect of Applegate\u2019s approach to regenerative agriculture is its fusion to their work in Diversity, Equity, and Inclusion (DE&I), where they are applying this dual focus to their supply chain relationships. Recognizing that building diverse farming networks requires investment, their partnership with the American Farmland Trust does double duty to support not only small-scale farmers, but equally farmers of all sizes from diverse backgrounds. \u201cWe\u2019re at the beginning stages of a three-year build to make a real impact, and every stakeholder matters,\u201d O\u2019Connor explains. Their Mission Report<\/em> states that 95% of Applegate products were sourced from suppliers that meet DE&I standards.<\/p>

By the end of our chat at the \u201cMecca\u201d of Wellness that is Expo West, I understood that Applegate\u2019s investment in regenerative agriculture is much more than a strategic business decision\u2013it\u2019s an audacious mission to change how the world eats meat. As Joe O\u2019Connor puts it, \u201cWe call ourselves the gateway to greater good, not just for this generation, but also the future\u201d\u2013a message that surely landed well on the show floor and left this author with the kind of hope that far outweighed the countless bags of natural product samples carried out the door by more than 67,000 believers.<\/p>

Applegate is charting a path toward a truly regenerative food industry that\u2019s powered by new models, new tech and new partnerships\u2014one hot dog at a time.<\/p>

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