Spanish company soils an Italian Brand Name: Are you the “Fixer”?

Steve’s breakdown: The Bertolli name has been tarnished and it looks to be Deoleo USA‘s fault because they just paid $7 million to make it go away.

Now they probably have to make good on fixing the brand because they are not the only company selling products under the Bernoulli name. ConAgra’s Bertolli frozen meals comes to mind.

Anyway, they need help and you can fix it. Try the new CEO Glenn Hartman at glenn.hartman@deoleo.com. I’m sure he’d love to hear some ideas.

DALLAS: Dive Brief:

  • Deoleo USA, the manufacturer of Bertolli olive oil, settled a class-action lawsuit last week by agreeing to pay $7 million and change its packaging and testing protocols, according to the settlement agreement.
  • The complaint, filed in 2014, alleged that the company misrepresented its products by labeling them as “imported from Italy.” The seven plaintiffs also questioned whether the olive oil could be extra virgin quality after being exposed to sunlight and heat and then further degrading while sitting on store shelves.
  • The settlement terms require Deoleo to agree not to use the phase “imported from Italy” unless its products are only manufactured by using olives grown and pressed in Italy. The company also will adopt stronger testing practices to make sure its products conform with extra virgin olive oil standards.

When it comes to food fraud, olive oil is one of most common. Products can easily be mixed with lower-quality oil, adulterated or deceptively labeled — and there is plenty of money to be made from selling supposedly premium extra-virgin olive oil at premium prices.

According to Mother Jones, in 2010, University of California–Davis researchers found 69% of imported extra-virgin olive oil samples bought off the shelf didn’t meet international standards required for that labeling. To combat these challenges, some producers are trying to increase consumer confidence in the product. Italian producer Bellucci has developed an app to keep track of the milling and bottling processes carried out by its growers in Italy. Consumers can trace any bottle of the company’s extra-virgin olive oil to its point of origin.

Class-action lawsuits obviously don’t help and could cast doubt on those olive oil products that are legitimately labeled and contain what the manufacturers claim is inside. As a result, other olive oil manufacturers and importers also may want to keep a closer eye on their sourcing, along with labeling and condition during transportation and storage, in order to keep their products as fresh as possible until they are sold.

Bertolli would be wise to shore up its reputation and win back the loyalty of disillusioned customers. Deoleo, its Spanish parent company, announced last summer that it planned to spend about $25 million on relaunching and marketing in Italy and the U.S., where it gets 60% of its profits. Perhaps some of this money can be diverted for improving its reputation.

Fallout from this settlement could encourage more olive oil production in California, which might mean better oversight, higher quality, fresher products and maybe even lower prices. It’s easier to guarantee authenticity when everything is produced on U.S. soil, and marketing campaigns touting this factor could win over consumers.

If California producers include consumer education about the sourcing and grades of olive oil, and possibly sponsor some in-store tastings in select markets, the outcome may give a major boost to the paltry 5.8% of the total U.S. consumption currently originating from the Golden State.

Olives are high in vitamin E and are full of antioxidants and monosaturated fat, value-adds that today’s health-conscious consumers are looking for. If domestic producers push these health benefits — and assure consumers that their products are the real deal — it might give the sector added momentum.

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