Youngerconsumers drive shift to ethical products
From free-range meat to vegan haircare, demand for sustainable goods is rising
12/23/2017 Younger consumers drive shift to ethical products
https://www.ft.com/content/8b08bf4c-e5a0-11e7-8b99-0191e45377ec 2/4
goods last year. The ethical food and drink market alone was up 9.7 per cent compared with 5.3 percent growth in 2015.
Businesses are seeing the appeal. For Thanksgiving this year Butterball, the US’s largest turkey producer, launched its first organic range in response to increasing consumer demand, while earlier in the year UK sandwich chain Pret A Manger opened its second and third all-vegetarian outlets. Ikea, which says that it uses its sustainable credentials to set it apart from other affordable homeware brands, intends to use only recycled or FSC certified wood by 2020.
Big consumer product groups are making concerted efforts, too. French cosmetics company L’Oréal this month unveiled its first vegan hair colour products, aimed at boosting its flagging professional haircare division. As part of steady strategy of smaller acquisitions, Unilever bought Sir Kensington, a maker of vegan mayonnaise, and Pukka organic teas. Its sustainable brands —those the company describes as “combin[ing] a strong purpose delivering a social or environmental benefit” — grew 40 per cent faster than the rest of the business in 2016, it says.
Younger consumers are fuelling this response. YouGov data show that in the past year alone the proportion of 18- to 24-year-olds turning to vegetarianism for environmental or welfare reasons has increased from 9 to 19 per cent. And it is not just in their consumer habits. “We know that millennials want to work for companies that take
this stuff seriously,” says Rob Harrison, director of Ethical Consumer. “Lots of new start-ups have an ethical mission and it translates across into buying patterns.” He is speaking to me on his Fairphone, marketed as “the world’s first ethical, modular smartphone”.
From free-range meat to vegan haircare, demand for sustainable goods is rising
12/23/2017 Younger consumers drive shift to ethical products
https://www.ft.com/content/8b08bf4c-e5a0-11e7-8b99-0191e45377ec 2/4
goods last year. The ethical food and drink market alone was up 9.7 per cent compared with 5.3 percent growth in 2015.
Businesses are seeing the appeal. For Thanksgiving this year Butterball, the US’s largest turkey producer, launched its first organic range in response to increasing consumer demand, while earlier in the year UK sandwich chain Pret A Manger opened its second and third all-vegetarian outlets. Ikea, which says that it uses its sustainable credentials to set it apart from other affordable homeware brands, intends to use only recycled or FSC certified wood by 2020.
Big consumer product groups are making concerted efforts, too. French cosmetics company L’Oréal this month unveiled its first vegan hair colour products, aimed at boosting its flagging professional haircare division. As part of steady strategy of smaller acquisitions, Unilever bought Sir Kensington, a maker of vegan mayonnaise, and Pukka organic teas. Its sustainable brands —those the company describes as “combin[ing] a strong purpose delivering a social or environmental benefit” — grew 40 per cent faster than the rest of the business in 2016, it says.
Younger consumers are fuelling this response. YouGov data show that in the past year alone the proportion of 18- to 24-year-olds turning to vegetarianism for environmental or welfare reasons has increased from 9 to 19 per cent. And it is not just in their consumer habits. “We know that millennials want to work for companies that take
this stuff seriously,” says Rob Harrison, director of Ethical Consumer. “Lots of new start-ups have an ethical mission and it translates across into buying patterns.” He is speaking to me on his Fairphone, marketed as “the world’s first ethical, modular smartphone”.
Ben Gleisner is the founder of one such ethically minded start-up. In 2009, while working as an economist in the New Zealand treasury, he identified what he calls a “massive market failure”: businesses, unaware that customers were interested in ethical products did not invest in them resulting in a “huge undersupply”. Lots of new start-ups have
an ethical mission and it translates across into buying patterns
Rob Harrison, Ethical Consumer
12/23/2017 Younger consumers drive shift to ethical products
https://www.ft.com/content/8b08bf4c-e5a0-11e7-8b99-0191e45377ec 3/4
Conscious Consumers, the platform he has set up, provides retailers with data about customers’ ethical preferences. Shoppers sign up online and link their credit or debit card to the app. Whenever they spend money at businesses registered with Conscious Consumers, data entered on their profile — from whether they would prioritise buying organic to whether they are interested in climate change or workers welfare — is sent to the retailer.
In 2015 Mr Gleisner and his team ran New Zealand’s second-biggest crowdfunding campaign and in autumn next year it plans to launch in its first foreign market: the UK. Richard Collier-Keywood, previously managing partner of PwC UK, has come on board as a director. Mr Gleisner says that 16- to 35-year-olds — Generations Y and Z — are the strongest market. “Generation Z is the most environmentally and socially ‘aware’ consumer market yet. Even more so than millennials,” he says.
an ethical mission and it translates across into buying patterns
Rob Harrison, Ethical Consumer
12/23/2017 Younger consumers drive shift to ethical products
https://www.ft.com/content/8b08bf4c-e5a0-11e7-8b99-0191e45377ec 3/4
Conscious Consumers, the platform he has set up, provides retailers with data about customers’ ethical preferences. Shoppers sign up online and link their credit or debit card to the app. Whenever they spend money at businesses registered with Conscious Consumers, data entered on their profile — from whether they would prioritise buying organic to whether they are interested in climate change or workers welfare — is sent to the retailer.
In 2015 Mr Gleisner and his team ran New Zealand’s second-biggest crowdfunding campaign and in autumn next year it plans to launch in its first foreign market: the UK. Richard Collier-Keywood, previously managing partner of PwC UK, has come on board as a director. Mr Gleisner says that 16- to 35-year-olds — Generations Y and Z — are the strongest market. “Generation Z is the most environmentally and socially ‘aware’ consumer market yet. Even more so than millennials,” he says.
The sticking point is cost. At higher-end supermarket Waitrose, where Ms Rymer is shopping, an Essential range chicken is £2.40 per kg while a free-range bird is £6.25 per kg — more than double the price. Josie Mallin, 27, who is shopping for a Sunday joint in the more affordable Morrisons supermarket nearby, chooses a standard chicken.
“I try to buy ethically but say a normal chicken is £4 and an organic chicken is £10, I’m going to buy the normal one,” she says.
The mark-up for ethical goods varies across sectors. While ethical laundry detergents are only about 9 per cent more expensive, according to Ethical Consumer, shampoos can be as much as 900 per cent more.
A 2015 global survey by Nielsen found that 66 per cent of respondents were willing to pay more forsustainable goods. Mr Harrison says, however, that customers are becoming more canny. “It used to be the case that companies would charge a premium and people wouldn’t spot that they were being fleeced. Now, if you don’t look around to check ethical risk in your supply chain, people will discover issues like child labour or pollution in China and you’ll have a front-page scandal.”
12/23/2017 Younger consumers drive shift to ethical products
https://www.ft.com/content/8b08bf4c-e5a0-11e7-8b99-0191e45377ec 4/4
Copyright The Financial Times Limited 2017. All rights reserved.
In developed markets, customers are beginning to expect ethical accreditation — such as Fairtrade, Rainforest Alliance or Living Wage — as standard. Kraft Foods forecasts that customers will soon look across the shelves and see that most products have an ethical mark. Those that do not will stand out. A third-party certificate certainly makes ethical claims clearer. “I’d like to start buying organic shampoo as well,” says Ms Rymer as she wheels her trolley away. “I just don’t know if I’m being asucker for the advertising or not.”
“I try to buy ethically but say a normal chicken is £4 and an organic chicken is £10, I’m going to buy the normal one,” she says.
The mark-up for ethical goods varies across sectors. While ethical laundry detergents are only about 9 per cent more expensive, according to Ethical Consumer, shampoos can be as much as 900 per cent more.
A 2015 global survey by Nielsen found that 66 per cent of respondents were willing to pay more forsustainable goods. Mr Harrison says, however, that customers are becoming more canny. “It used to be the case that companies would charge a premium and people wouldn’t spot that they were being fleeced. Now, if you don’t look around to check ethical risk in your supply chain, people will discover issues like child labour or pollution in China and you’ll have a front-page scandal.”
12/23/2017 Younger consumers drive shift to ethical products
https://www.ft.com/content/8b08bf4c-e5a0-11e7-8b99-0191e45377ec 4/4
Copyright The Financial Times Limited 2017. All rights reserved.
In developed markets, customers are beginning to expect ethical accreditation — such as Fairtrade, Rainforest Alliance or Living Wage — as standard. Kraft Foods forecasts that customers will soon look across the shelves and see that most products have an ethical mark. Those that do not will stand out. A third-party certificate certainly makes ethical claims clearer. “I’d like to start buying organic shampoo as well,” says Ms Rymer as she wheels her trolley away. “I just don’t know if I’m being asucker for the advertising or not.”
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