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General Mills (NYSE:GIS) is one of the world’s ten largest food companies. Fast Company recently said, “Pressure from consumers and shareholders is causing many of the biggest food and beverage companies in the world to improve their social and environmental policies.” On April 2nd, General Mills took a major step toward addressing some of those policies, especially as relating to social media, that have the potential to rock the world of, not only food companies, but of all consumer goods companies.
The packager of Betty Crocker, Green Giant, Haagen-Daz, Jus-Rol, Nature Valley and Old El Paso in the UK has posted an announcement across the top of its home website that reads: “We’ve updated our Privacy Policy. Please note we also have new Legal Terms which require all disputes related to the purchase or use of any General Mills product or service to be resolved through binding arbitration. For more information on these changes, please click here.” Whilst these new terms are only applicable to US customers as yet, General Mills may be the flag bearer for a legion of similar practices by similar companies in the not too distant future, not only in the US, but in the UK and around the world.
What They Say
The key components of the policy indicate that . . .
- General Mills collects consumer information, “including not only the information you directly provide, but also the information we may gather passively or receive from social-networking services, data aggregators, and other third parties.”
- General Mills uses the information collected, “including how this information may be combined with other information from multiple sources to customize your interactive experience and provide you with relevant advertising on our sites or elsewhere online.“
- General Mills’ customers must agree to submit all disputes to informal negotiation or, ultimately, binding arbitration.
- General Mills’ customers are bound by the terms and “may terminate this agreement at time by notifying us by email of your intent to do so, but only if you also cease to participate in any of our offerings.”
What They Mean
- If you “follow” or “like” one of their brands on social media, you essentially surrender you rights to file a suit against the company, on the theory that you cannot have a complaint against what you have publicly indicated that you like.
- Neither may you sue the company if you have used deals and coupons advertised on their websites.
- “Information negotiation” means using the likes of mail or email, i.e., without the use of a legal advocate, to lodge and resolve complaints.
What It Means
The bottom line is that, should General Mills succeed with the implementation of this policy, it is sure to spread in favor with the other major food companies and packaged consumer goods companies in the US, and, since those major companies are worldwide, we should expect the policy to be implemented to the fullest extent possible.
Julia Duncan, Director of Federal Programs for the American Association for Justice says that, “Although this is the first case I’ve seen of a food company moving in this direction, others will follow — why wouldn’t you?”
So, at long last, it does appear that what we say on social media can be used against us. How this will effect the food sector from either an investor standpoint or a consumer perspective remains to be seen, but we’ve all got to eat sometime.
General Mills share price is down 0.27% today at 52.12. Although the share price has been declining since April 3rd, it has been regaining ground since April 10th when it had dropped to 51.00. The stock has been trading above its 50 day moving average since February 13th.
