European Shoppers Seeking Value for Ethical Products – IGD

Over three-quarters of shoppers in France, Germany, the Netherlands, Spain and the UK told IGD they are interested in the ethics of food. At least 30% mention ethical values as one of the reasons to try something for the first time.

3/16/2011 --- Despite the tough economic conditions, European shoppers remain interested in the ethical standards of the products they buy, but they are less prepared to pay a big premium for them, according to IGD - the international food and grocery experts.

Over three-quarters of shoppers in France, Germany, the Netherlands, Spain and the UK told IGD they are interested in the ethics of food. At least 30% mention ethical values as one of the reasons to try something for the first time.

Speaking at GS1 Belgium’s Forum 2011 event, Joanne Denney-Finch, chief executive, IGD, said: “Shoppers across Europe are clearly interested in the ethical stories behind the food they buy, but they don’t want it to come with a big price tag. They want value for their values.

“However, companies investing in sustainability could potentially see an excellent return. In all five countries in our survey, shoppers told us they expect to spend more on ethical products.

“Consumer goods companies are at the forefront of meeting shoppers’ ethical aspirations. Ecover is a very good example. From its origins in Belgium, it now has a presence in over 30 countries. I’m convinced our industry will show that it’s possible to deliver sustainable growth and leave a very positive lasting legacy.”

IGD has identified several challenges and opportunities in driving ethical growth.
Challenges include:

• Complexity: our research shows most shoppers (over 70%) are not interested in every ethical issue relating to food, but focus on one or a few other areas. As ethical priorities differ by person and between countries, it is a complex matter for companies to manage and they cannot simultaneously take the lead on all ethical issues

• Trust and scale: While many recently formed companies have brands based on ethical values and use these to drive growth, shoppers are more sceptical about larger companies’ ethical credentials
Opportunities include:

• Brand building: This is a long-term investment and the benefits will accumulate over time. For example, when the celebrity chef and food campaigner Jamie Oliver recently praised McDonalds for using free range eggs, organic milk and locally sourced beef, it was picked up by all the major American networks

• Financial return for going green: There is growing evidence that working on long-term sustainability can also deliver short-term profitability. Marks and Spencer, for example, expected to spend £200mn in its drive to become the world’s greenest retailer but in fact, the programme is delivering a profit.