ecology trend

Sourcing.eco Blog

Keep up-to-date with the latest updates in sustainable production and purchasing.
Learn about industry expectations, trade best practices and regulations.

  1. Consumer expectations toward retail brand sustainability

    What is a sustainable brand?

     

    Concerns about climate change, toxicity, and waste have begun to influence consumer behavior around the world. The share of those looking for environmental protection from brands is increasing, and this is pushing companies with a wide variety of products to produce and consume more sustainably.

    A global survey of 20,000 customers by food brand giant Unilever found that one in three (33%) people choose brands they believe are good for the environment.

    Corporate Social Responsibility or «CSR» is more than just a way for brands to stand out. Sustainable branding is becoming an expectation for today's consumers. Companies that combine their mission and purpose with sustainable values ​​and support environmental and social goals in ways related to their business can greatly influence the public's willingness to buy, invest and work for them.

    The Sustainable Brands conference outlined the main characteristics that a roadmap for any green company should include:

    • System-wide brand influence.
    • Net positive products and services.
    • Goals beyond profit.
    • Regenerative operations (recycled materials and environmentally friendly processes).
    • Transparent and proactive governance.

     

    What problems exist

     

    A study by McKinsey Fashion on Climate study shows that the fashion industry accounts for 4% of global emissions, of which 70% comes from mining, «especially energy-intensive manufacturing, preparation, and processing of raw materials».

    Intending to reduce the negative impact of the industry on the environment, 32 major global fashion and textile companies, from H&M and Gap to Burberry and Chanel, have signed Fashion Pact.

    The initiative, led by parent company Gucci and French elite house Kering, aims to achieve zero carbon footprint by 2050 and invites the industry to offer «regenerative» approaches to agriculture, including eliminating batch-based intensive farming sources.

    To protect the oceans, the pact calls for a reduction in the use of single

    Consumer expectations toward retail brand sustainability

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  2. Consumers Are Driving Brands Toward Sustainability

    Generation Y (or Millennials born between 1981 and 1996) and Generation Z (born after 1996) represent an ever-growing consumer power in the global economy. In the US, the purchasing power of Gen Z has already exceeded $ 500 billion. Millennials make up about a quarter of the world's population, and statistics show that the purchasing power of Generations Y and Z is high and growing.

    For years, millennials have been a central stage for brands and marketers. But for some time now, the new group has been gearing up to take its share of Gen Z's consumer attention. These are the consumers that companies want to conquer. This audience is expected to overtake millennials, who make up 32% of the world's population. And as Gen Z enters the workforce and their purchasing power increases, they will undoubtedly be a key target for brands to achieve customer appeal.

     

    Ecology trend

     

    Climate changes are caused by changes in the earth's atmosphere, processes occurring in other parts of the Earth, such as oceans, glaciers, as well as, already in our time, the effects associated with human activities. Poor ecology is pushing Gen Z and millennials to new consumption patterns that consider the ethics and sustainability of what we consume. While sustainability considerations are not yet a major buying driver, it is expected that sustainable brands will continue to gain market share as the purchasing power of these generations grows.

    It is clear that both consumers and brands are trying to reduce their impact on the planet, and as we approach the critical mass of consumption, we can expect sustainability issues to grow in importance.

    Consumers are concerned about the quality of the ingredients used in the production of goods, the conditions in which the goods are produced, as well as the processing and recycling of packaging. This trend is confirmed by many large companies. For example, the British company Lush was one of the first to understand the importance of minimizing packaging waste and for many years has been producing cans for products only from recycled materials. L'Oreal plans to phase out single-use plastic by 2025. The brand has already launched the Source Essentielle hair care line, where shampoo bottles can be refilled - just go to the L'Oreal Professionnel salon. And there are many such examples in various areas of business.

    Successful green products do not have to look or feel any different than green versions but bringing these products to market in more sustainable ways will undoubtedly become a more important direction for consumers.

     

    Buyers' opinion

     

    First Insight's 2019 report, The State of Consumer Spending: Gen Z Shoppers Demand Sustainable Retail, finds that 62 percent of Gen Z who will start shipping this year prefer to buy from sustainable brands.

    Also, the majority of Gen Z (54%) say they are willing to spend an extra 10% or more on green products, with 50% of millennials saying the same. This compares with 34% of Gen X and 23% of baby boomers. It can be concluded that with each generation, the desire for sustainability is increasing.

    Deloitte's Global Millennium Generation Survey 2020 shows young consumers are concerned about climate change and unequal wealth distribution. In a survey, 65% of millennials and 57% of Gen Z said they had increased their recycling efforts, and half of 50% and 41% of Gen Z had reduced or stopped their fast fashion consumption.

    It is also important that consumers are willing to pay more for products that are manufactured with sustainability in mind. According to an Accenture survey, more than half of consumers said they would pay more for green products that are intended for reuse or recycling.

    According to a Nielsen study, consumers across all regions, income levels, and categories are willing to pay more for green products. The level of potential willingness of consumers to pay more for the products of companies that are responsible for society and the environment is more than 80%. At the same time, in developing countries, Millennials and Generation Z are willing to pay the highest prices.

    Consumers Are Driving Brands Toward Sustainability

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