Appetite for sustainable food products looks set to remain low until there’s a sweetener for the consumer
While there is increasing consumer interest in sustainability, persuading mainstream consumers to make sustainable food choices, particularly when there is extra cost attached, is extremely challenging.
This was the starting point for a new report from Canadian consultancy Stratos, which aims to provide a sustainability toolkit for food companies. Stratos specialises in helping companies identify environmental, social and economic risks and opportunities.
The report – Recipe for Sustainable Food – looks at the various ways five leading food companies – Marks & Spencer, McCain, Sodexo, Tim Hortons and Unilever – approach sustainability, and derives from that the “ingredients and directions” for the “recipe”.
As the report’s author, Stratos director Matt Loose, puts it: “There is demand for more sustainable products but very mixed signals about whether consumers are willing to pay for them.”
For instance, one element of the report’s definition is a “resilient and transparent value chain that makes best use of local and regional produce”. A recent study by Ogilvy & Mather in the US suggests that 81% of consumers also see local food as an important part of a sustainable lifestyle but only 49% regularly buy local.
Motivation matters
That consumer motivation around sustainability varies markedly across the population is not surprising. Most segmentation research shows fairly consistent results, with highly motivated food consumers accounting for about 10% of the market and the least concerned about the same. It is the remaining middle majority that is naturally of most interest, as it is both the largest constituency and the one with the most growth potential.
Research by Hartman Group in the US on consumer motivations around sustainability contends that mainstream consumers need a further personal motivation to buy sustainably. “Sustainable products with a personal benefit (good for personal health or saves money for the household) are much more relevant to most mainstream consumers than sustainable products with just an environmental benefit when they are first entering the marketplace,” says Laurie Demeritt, Hartman Group chief executive.
Hartman’s research indicates mainstream consumers are “generally willing to pay a bit more for sustainable products”, but will often “be positively influenced by a company’s efforts to offer low prices on products with sustainability cues”.
Price is clearly pivotal in moving the mainstream food market on sustainability and some believe this is an area where governments have to step in. Daniel Crossley, executive director of the UK’s Food Ethics Council, says unequivocally that “unsustainable food should be more expensive than sustainable food”.
But how? In its recent report, Beyond Business As Usual: Towards a Sustainable Food System, the Food Ethics Council advocates a stronger regulatory lead from governments to bring about “transformative change” in the food market, notably by introducing “sustainability taxes” on unsustainably sourced food.
As long as more sustainable food choices remain costlier or at best at price parity with less sustainable ones, providing consumers with information on sustainability remains vital. Indeed, the Stratos report states: “Effectively communicating on food sustainability with consumers is integral to a successful sustainable food offering.” However, it also refers to the “confusing array” of sustainability standards, labelling and practices used by food companies.
Loose says this makes it extremely difficult for consumers to assess and compare products on sustainability criteria. “Over time there is going to need to be some consolidation,” Loose says, adding: “I think there’s some systemic change needed to the way in which industry provides information around sustainability before we can really move to a more sustainable food system.”