Consumers bite back as boycotts send shivers down retail spine

Soaring food prices have triggered a wave of consumer backlash, with boycotts erupting online and demand plummeting across various items.
This phenomenon, increasingly witnessed over the past year as food inflation climbed into double digits, fuelled by widespread internet access, has targeted goods ranging from beef and eggs to onions and soft drinks.
Economists and supply-chain experts, navigating the gray area between demand squeezes and full-blown boycotts, link this trend to two key factors: a monitoring gap exploited by middlemen and a growing online space for disgruntled consumers to unify.
However, concerns about potential disruption to production, supply chains and stakeholders remain.
Dr Masrur Reaz, chairman of Policy Exchange Bangladesh, pinpoints production quality and price concerns as the primary drivers of boycotts, with social media acting as the catalyst for consumers to harness their collective power.
Besides, perishable, widely consumed goods with readily available alternatives appear particularly to qualify for such consumer vengeance.
Take the case of green coconuts. This antioxidant-rich fruit, favoured by city dwellers during scorching summers, saw its price skyrocket from a typical Tk 100 to Tk 220 during last year's dengue outbreak.
Consumer rights authorities were shocked, quipping, "Our traders seem to have invented dengue daabs!"
Disgusted by this blatant exploitation, consumers gradually turned away from the fruit. Doctor-led awareness campaigns further emphasised that green coconuts were not essential for dengue treatment, leaving coconut traders holding the bag. Prices have since halved, currently ranging from Tk 60-70 to Tk 90-120.
"The fall in coconut prices is a prime example of successful consumer boycotts," Dr Reaz said.
However, Dr Rashidul Hasan, a value chain expert, acknowledges while coconut production has dipped in recent years, the exorbitant price gap between growers and city retailers also exacerbated the situation for consumers.
Soft drinks hit hard
Consumers' newfound scrutiny of soft drinks represents a complex force in Bangladesh's economy, with potential benefits and drawbacks, says Dr Masrur Reaz.
While boycotts driven by ethical concerns, like those targeting brands perceived as linked to the Israeli-Hamas conflict, can be powerful tools, he argued that broader economic considerations, including market stability, brand reputation and market confidence, often outweigh such temporary shifts.
The challenge lies in navigating the information landscape, where readily available facts can be muddied by misinformation, potentially swaying the opinions of less informed consumers, Dr Reaz noted.
This dynamic played out starkly in 2023, when widespread boycotts erupted after local and multinational beverage companies implemented price hikes of 25 per cent to -38 per cent between March and June.
Sanjay Mistri, a grocer in Dhaka's East Rayer Bazar, witnessed firsthand the dramatic decline in demand that forced companies to backtrack on their pricing.
While the immediate financial pressure eased, the reputational damage to these brands lingers, underlining the potential long-term consequences of consumer boycotts driven by price concerns.
A wrong target?
The popular dragon fruit has become an unexpected victim of a growing consumer boycott movement in Bangladesh, raising concerns about the impact of misinformation.
Until recently, the exotic fruit enjoyed strong demand, fetching farmers handsome profits at roadside stalls, with prices typically in the Tk 300-400 per kg range. However, this rosy picture has drastically changed. Dragon fruit is now struggling to find buyers even at a significantly lower price of Tk 150 per kg.
The shift appears linked to viral YouTube videos claiming the use of harmful chemicals at farms to boost production. These concerns, despite extensive government assurances of the fruit's safety, have led millions to turn away from dragon fruit.
Dr Md Mehedi Masood, director of the Year Round Fruit Production for Nutrition Improvement Project under the Ministry of Agriculture, points to the fruit's impressive growth story.
Dragon fruit cultivation has exploded from a mere 18 hectares a decade ago to a thriving 2,100 hectares in 2022-2023, yielding approximately 26,000 tonnes and generating a market value of around Tk 5 billion.
Addressing concerns about Gibberellic Acid -- a plant hormone sometimes used in fruit cultivation -- Dr Masood asserted it is not a cause for alarm. "It's organic and obtained from plants and fungus," he clarified, "posing no threat to consumers."
However, he expresses deep concern about the impact of unverified information spreading online. "Viral videos and Facebook posts about hormone use are severely hurting demand and impacting farmers' livelihoods," he lamented.
Despite the current downturn, Dr Masood predicts a further 10% increase in dragon fruit production this year, with market value potentially reaching Tk 5.7 billion. State-run laboratories are also conducting ongoing tests to provide reliable information on any potential safety concerns or benefits of the fruit.
The dragon fruit's plight highlights the delicate balance between consumer awareness and the dangers of misinformation.
Dr Masood emphasises the need for "scientific proof before drawing conclusions from social media influences," advocating for caution and reliance on trustworthy sources before forming opinions.
Some essentials immune to boycott
Al Adnan Nahiyan, assistant professor in the Department of Economics at Jahangirnagar University, has been working on consumer behaviour. He said it is a new study for the country's behavioural economics.
He said recent consumer boycotts have targeted non-essential luxury items, which, fortunately, have minimal impact on daily life.
Additionally, due to soaring inflation, the demand for such products is on a downward trend.
While consumers may cut back on high-priced items like these, complete boycotts are often challenging.
Examining essential commodities such as rice, flour, potato, onion, eggs, edible oil, sugar, and salt, along with information circulating on social media about their record prices, provides a comprehensive understanding.
"For instance, beef prices reached an all-time high of Tk 850-880 per kg in 2023. The lower-middle class largely abstained from consuming it, and the middle class reduced consumption," he said.
However, in November 2023, some meat shop owners began selling beef at Tk 600-650 a kg, including fat and other unnecessary parts, leading to a substantial increase in consumption.
Directorate of National Consumers Right Protection head AHM Shofiquzzaman, also believes consumer boycott has both positive and negative perspectives.
He said it was positive over green coconut or beef to some extent, but in the case of boycotting a restaurant over a viral video in 2023, claiming the restaurant used cat meat in its biriyani, was a sure example of manipulation.
He called for consumer awareness while boycotting anything.

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