Ethical shopping exists, but new research shows that today’s caring, sharing consumers are motivated as much by feel-good factors as by altruism. The greater good is being usurped by personal well-being, as Datamonitor’s Dominik Nosalik reports.
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A new report by Datamonitor, Organic, Natural, Ethical & Vegetarian Consumers found that European consumers’ ethics and values are influencing their everyday shopping. So-called ‘green’ consumerism is on the march, however the green movement has changed since the media frenzy that surrounded it in the 1980’s. Consumers are now more likely to buy organic goods or environmentally friendly products motivated by what makes them feel good about themselves, rather than for altruistic reasons. Datamonitor’s analysis of several key green markets across Europe reveals that sales of organic foods and ethical personal care goods will continue to increase while vegetarianism is no longer attracting so many new joiners.
While there will always be a niche group of altruistic consumers who are motivated to buy green and ethical products for the greater good, the majority of consumers are motivated to purchase these goods on a more superficial level. Analysis of consumer attitudes and how companies are marketing themselves and their products revealed that more people are buying “green” because that is what makes them feel better. Some manufacturers have realised that putting self-interest first and altruism second makes for a successful product positioning. CaféDirect, for example, recently re-branded its fair trade coffee to 5065, marketing the quality of the product first and the fair trade second.
“A majority of consumers want something that “does good for me” but also like the feeling that it “does good for someone or something else”. Marketers need to recognise that, while consumers want to derive dual benefits from a product, the benefits for the individual need to be stronger than the benefits to any given cause. As our daily routines are becoming more time-pressured and stressful, we are looking to get back to basics. Consumers are demanding simpler, more wholesome products that have a long-lasting value and not just a fleeting appeal. Consumer lifestyles are changing in other ways too. Health has always been important, but nowadays there is greater emphasis on achieving total well-being – feeling and looking good. Consumers expect their daily shopping to provide them with functional and emotional benefits,” comments Dominik Nosalik, Datamonitor consumer markets analyst and author of the report.
Consumer pressure on business ethics
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By GlobalDataIn addition to consumer awareness of environmental and health issues, awareness of corporate ethics has also driven green product purchase. Anti-corporate activism has risen throughout the 1990s as more people recognise the rising power of large organisations. Attacks on companies such as McDonald’s and Starbucks during the 1999 riots in Seattle have been heightening awareness of business ethics among all people. In addition, publicity surrounding books such as Naomi Klein’s ‘No Logo’ have made the issue mainstream. As a result, companies now feel more pressured to present themselves as socially responsible.
Organic consumers come in two varieties…
Datamonitor analysed several green consumer markets, including organic foods, vegetarian foods and ethical household and personal goods. The organic sector represents one of the largest markets. Research across seven European countries found that organic spending will nearly double over the next five years to reach a value of €17bn (US$14.95bn). By 2006 58% of European consumers will choose to eat organic food. In 2001, the UK had 29 million adult consumers of organic food and drink, representing almost half the population. Germany and France follow with 40% and 38% of the population eating organic produce respectively.
Organic consumers tend to fall into one of two groups: those who buy into the “organic ethos” whole-heartedly and shift as much of their shopping as possible over to organic products; and those who buy organics every now and then, seeing organics as healthier or more prestige products and typically buying them because of their currently fashionable status. There are 142 million consumers of organic food and drink in Europe – a split can be seen between loyal and occasional users. Loyal users account for 20 million people in Europe yet were responsible for 69% of spend in 2001.This suggests that a significant proportion of the organic market is not based on consumers who buy regularly. If production processes improve significantly in the conventional food market and/or organics lose their fashionability, the market potential of organics will be considerably less than most commentators predict.
Encouraging performance of ethical personal care markets
Ethical personal care products have achieved significant share of the overall personal care market. On average a 5% market share has been achieved across the haircare, skincare, personal hygiene and make-up markets in Europe. The reason for this is that most successful ethical personal care brands such as Aveda, Lush and Origins are also ‘natural’, which consumers perceive as offering distinct benefits such as being less harmful to the skin, fresher and better smelling. Providing such functional benefits for the individual, as well as emotional benefits of helping a ‘greater good/cause’, creates a more compelling proposition for the consumer.
Vegetarianism is slowing
Overall there are 12 million vegetarians in Europe – an increase of 1 million since 1996. However, growth in the number of full-time vegetarians has been slowing down in recent years – there were only 100,000 additional vegetarians between 2000 and 2001, the lowest increase since 1996. Although a core of loyal followers has developed in certain countries such as the UK and the Netherlands, vegetarianism is no longer attracting so many new joiners. Many who joined in the late 1980s and early 1990s have abandoned vegetarianism as it has begun to lose its “trendy” appeal. For example, in the UK, some celebrity vegetarians, such as Anthea Turner and Julia Sawalha, have allegedly turned their backs on vegetarianism and the issue is no longer so strongly covered by the media. Ultimately the future growth of full-time vegetarians as a consumer segment will stabilise and will not see significant growth.
Meat reduction on the increase
Growth in the vegetarian market looks set to be generated from the growth in people actively reducing their meat consumption. Meat-reducers are motivated primarily by health concerns and account for 138 million people across Europe. The UK and Germany have the greatest proportion of meat-reducers at 46% and 44% of their respective populations. Even countries not noted for their vegetarian segments, such as France and Spain, have significantly large proportions of meat-reducers at almost a quarter of the population each. Some 11 million new meat-reducers will join this segment by 2006. Significantly, this segment already accounts for a high proportion of people, at 36% of Europeans overall. Therefore this group represents an attractive market for manufacturers and retailers to target.
Trendsetters, trendspotters and the mass-market followers
Many green markets have often started from very humble beginnings to become commercial success stories. Organic food and natural cosmetics and toiletries have hit the mainstream after many years as ‘alternative’ and niche markets. Green markets have often been created by those consumers who believe strongly in a particular cause or way of life in response to a lack of suitable options. For manufacturers the opportunity lies in spotting which of these markets has real market potential development and targeting the mainstream consumer.
The report Organic, Natural, Ethical & Vegetarian Consumers is available in the just-food.com research store. For more information, click here.
