Ethical marketing is less sustainable in grocery aisles

by Alex Brownsell, Marketing 16-Sep-08, 08:40

LONDON - Consumers are prioritising thriftiness over ethical purchasing in the current economic climate, according to a report by the Food Standards Agency (FSA).

The FSA asked more than 2000 consumers which issues they consider when choosing one food product over another, and which of these issues are most important to them. Some 66% responded that they are most influenced by economic concerns, while 23% claimed they are concerned with social issues.

Meanwhile, a mere 10% told the FSA that their primary concerns relate to environmental and sustainability issues, while only 53% of respondents mentioned a single green issue in their list of shopping considerations.

The FSA research is backed up by recent figures published by Mintel, which found that after soaring 70% since 2002 to reach a value to of £1.5bn last year, sales of organic foods have slowed as consumers defect to discount grocers.

Ed Garner, research director at analyst TNS, agrees that supermarkets' premium ranges are down on the whole, while basic ranges are attracting a new audience. 'There has been a slippage in premium products as people are moving down from premium to branded, and from branded to basic,' he said. 'Sales of basic ranges at the top supermarkets have never been better.'

There is 'little new' to be gained from the FSA's findings, according to Callton Young, director of sustainability and competitiveness at industry body the Food and Drink Federation. 'Factors such as price, quality and appearance have always featured most highly in consumers' purchasing decisions,' he added. 'However, consumers do expect food and drink manufacturers and other companies in the food chain to behave corporately responsibly, working to reduce their environmental impacts wherever possible.'

Only 5% of respondents to the FSA survey spontaneously cited organic production as a criterion, and the FSA observed that sustainability remains 'a confusing concept for some people'.
A spokeswoman for the Soil Association agreed that the subject of organic food can prove difficult to understand, but urged consumers to look for the Soil Association logo to provide clarity.

Caroline Sloan, client services director at ethical marketing agency Feel, acknowledged that the economy is causing many people to re-evaluate their purchasing decisions, but said that brands may benefit from combining a commitment to ethics with price, as in the case of Marks & Spencer's current 'Dine in for two for £10' activity, which is running alongside its ongoing 'Plan A' initiative.

Comments

CHRIS ARNOLD - 17/09/2008

Price has always been a sensitive issue in the ethical food market, even when the economy is healthy. Many supermarkets have pushed prices of ethical products into the premium category – organics and Fairtrade have traditionally been over 30% more expensive. In a price sensitive economy anything that’s higher in price will suffer and it’s no surprise organics are taking a hit. However, when positioned at an equal price consumers will go for the ethical choice. Fair Instant, a Fairtrade coffee that is equal in price to Nescafé is flying off the shelves. Even though the media tends to focus on environmental issues (and it is Organic week) in the ‘People vs Planet’ survey up to 76% opted for saving people over the planet, prefering to spend the pound in their pocket to make a humanitarian point rather than an environmental one. It also revealed that they see environmental issues as something that was the responsibility of governments and large corporates. Responsibility is a key factor behind purchasing decisions. The word sustainability is a word few consumers understand. It is better understood in the States where it’s been used more. In another survey people were not trusting of terms like ‘environmentally friendly’ seeing it as spin. The same survey also revealed that Fairtrade was the most attractive ethical factor in fmcg. The industry is awash with surveys, few surprising. As I’m currently writing a book on Ethical Marketing & The New Consumer, if you want to add any interesting case studies, insights or make a valuable contribution please contact me via my blog on brand republic. www.brandrepublic.com/ethicalmarketing. The fashion industry is going through a similar issue at the moment with price and value. Primark are selling more fashionable ‘fast fashion cloths to compete with the more trendy fashion stores, bad news for M&S. However, at top end of premium products are not suffering. As one high end retailer said, “when there’s a down turn in the economy the only belt our customers will be tightening will be made by Gucci.”