‘New reality’ for manufacturers and retailers – eco-friendly, fair trade, organic, and most of all sustainable
January 30, 2008
Approximately 50 percent of U.S. consumers consider at least one sustainability factor in selecting consumer packaged goods (CPG) items and choosing where to shop for those products, according to a recently released survey conducted by Information Resources, Inc.(IRI)
The 22,000 U.S. consumers surveyed were asked to determine the impact of four key sustainability features in their product and store selection—organic, eco-friendly products, eco-friendly packaging and fair treatment of employees and suppliers. One-fifth of those surveyed were determined to be “sustainability driven,” taking at least two sustainability factors into account when making their selections.
“Sustainability has evolved from a niche segment concern to a major factor influencing purchasing and shopping behavior across a sizable consumer base,” says IRI Chief Marketing Officer Andrew Salzman. “Our survey indicates that consumers are focused more and more on the social and environmental impact of their CPG purchases, creating a viable and growing U.S. market for sustainable products and packaging with the potential to mirror well-developed markets in Europe and Japan. U.S. retailers and manufacturers are beginning to respond to that demand.”
Among the IRI results highlighting the evolution of sustainability factors in consumer decision-making are the following:
• Approximately 30 percent look for eco-friendly products and packaging in their brand selection
• Up to one-quarter of those surveyed consider fair trade practices along with eco-friendly or organic designations in selecting a shopping destination
• Nearly 40 percent of consumers search specifically for organic products
“Currently, organic products are scoring extremely well with consumers,” says Salzman. “Benefiting from the winning combination of a ‘better for you’ association and a ‘better for the environment’ attribute, the organic designation has moved to the front of consumer consciousness.”
“It’s a new reality that manufacturers and retailers will need to address with new products and unique assortments to tap into emerging growth potential,” says Salzman. “Safeguarding the environment in whatever small way is becoming a consumer priority. And, all successful CPG industry mainstays live by one basic fact of life: the consumer’s priorities are the industry’s priorities.”
Whether motivated by the aim for healthier ingredients or a heightened environmental consciousness, the survey also underscores the fact that calls for sustainability cut across every consumer age group. Though contrary to assumptions that the focus on sustainability is a more youth-oriented phenomenon, IRI data shows that older consumers are actually the more likely audience to weigh multiple sustainability factors in their purchases.
“Consumers aged 55 and older are the real driving force behind this expansion,” says Salzman. “Generally, with the time to seek out specialty items and the resources to afford premium priced products, aging consumers are a critical target market today. As sustainable products and packaging become more widely available, we anticipate that the market will expand across consumer segments.”
Remember…every purchase is a vote – it does make a difference.
IRI is the world’s leading provider of consumer, shopper, and retail market intelligence and insights supporting 95 percent of the FORTUNE Global 500 consumer packaged goods (CPG), retail and healthcare companies.