Offering Ethicality & Sustainability in Personal Care

Published by: Datamonitor

Published: Sep. 8, 2010 - 228 Pages

Table of Contents

Overview

Catalyst

Summary

Table of Contents

Table of figures

Table of tables

THE FUTURE DECODED

INTRODUCTION: Ethical consumerism is influenced by numerous drivers and inhibitors

This report focuses on the highly topical issue of ethicality and sustainability in consumer-packaged goods (CPGs), with specific emphasis on personal care products

Consumers are pivotal to the growing influence of ethicality and sustainability in packaged goods

Ethical consumerism involves a mix of positive and negative behaviors, while sustainability is a more holistic term capturing a broader range of issues

Sustainability reflects wider global issues ranging from the natural environment to financial markets

Ethical consumerism is driven by a number of influences, which are covered in greater detail in the Trends and Insights in this report

TREND: Environmental concerns among individuals are escalating globally

Knowledge of and interest in environmental issues is growing although gaps are also still apparent

Concern surrounding climate change rivals that of the economy and rising unemployment, even amid a deep economic crisis

Environmental concerns are causing consumers to reflect on their consumption levels

Key take-outs and implications: ethical and environmental issues will be a top priority for global consumers in the coming years which necessitates considerable industry focus too

TREND: Beauty consumers are acting on ethical beliefs in their general product choices, but a disconnect exists between attitudes and actual purchase behavior

Consumers are reflecting on their own behavior in light of escalating ethical consciousness

There is often a gap between the stated importance of ethical issues and actual purchase behavior

Ethicality-aligned product features are typically lower down the list of behavioral influencers for both store and in-store personal care choices

There is some evidence that consumers are prone to a so-called rebound effect

Key take-outs and implications: consumers are committed to ethical buying to varying degrees so there is no guarantee that consumers will consistently choose 'good companies'

TREND: Organic and natural personal care spend growth remains strong and reflects the ongoing influence of environmentalism and health in directing consumer choices

A high and growing proportion of consumers express some level of concern about ingredients used in conventional beauty products

The natural and organic personal care market has benefited from being at the intersection of the health, ethical and sensory trends, but important question marks still exist regarding efficacy

With ambiguity in the classification of both natural and organic terms, confusion exists about what such products actually mean

Natural and organic personal care products will exhibit continued growth over the next five years owing to consumers' favorable perceptions

Key take-outs and implications: the strong momentum behind natural and organic personal care will continue in the coming five years

TREND: Growth in Fairtrade personal care is expected to supersede natural/organics in more developed markets over the next five years

Fairtrade is more heavily weighted towards the social responsibility dimension of ethicality

Awareness of Fairtrade is not universal, but the importance attached to its principles is generally high

Consumers are making more effort to support Fairtrade, but only a minority do so routinely

Fairtrade personal care sales will gain further momentum over the next five years

The ongoing growth and mainstreaming of Fairtrade is potentially dangerous to the value proposition

Key take-outs and implications: Fairtrade personal care products will begin to establish a mainstream presence in the next five years

INSIGHT: Animal welfare and environmental biodiversity are particularly important issues in the realm of ethical personal care consumption

Animal testing is an important consideration for personal care consumers, both attitudinally and behaviorally

Certification schemes help ensure that animal testing claims are more formally regulated

Growing attention has been directed towards biodiversity, particularly the use of palm oil in personal care products

Consumers primarily opt for welfare-friendly products due to self-interest factors associated with product quality and health benefits

Key take-outs and implications: issues of animal welfare and biodiversity protection resonate strongly with consumers, and personal care manufacturer efforts should act on this reality

INSIGHT: Environmental and ethical concerns drive heightened interest in personal care products using locally-sourced ingredients

Key take-outs and implications: locally-sourced health and beauty ingredients tap into the growing sense of social responsibility among global consumers

INSIGHT: Packaging has emerged as a highly important issue in the sustainability debate, including in the beauty industry

Sustainable packaging in personal care grows in importance as consumer awareness increases

Consumers are slowly beginning to put their ideals to practice when it comes to reduced personal care product packaging

Personal care product packaging has an important role as a vehicle for communicating aspects of company/brand ethicality

Recyclable and sustainable personal care packaging is appealing for consumers as it offers a simple yet effective solution to address climate change

Ethically-aligned personal care is also driven by advancements in packaging innovation

Key take-outs and implications: consumers feel that grocery packaging is excessive and are making consumption adjustments accordingly; therefore, producers must react to ensure that packaging is more sustainable

INSIGHT: Ethical consumerism can have important implications for emotional wellbeing

Living an ethical or sustainable lifestyle is an important part of creating a feeling of wellbeing

Global warming is directly associated with negative personal health effects

Key take-outs and implications: environmentalism and health are more inter-related than many realize

INSIGHT: Many factors impede the larger-scale adoption of ethical and sustainable personal care products such as lack of perceived value, lack of trust, and limited choice

A lack of specific knowledge is one important consideration impeding ethical personal care consumerism

A perception of 'efficacy compromise' still inhibits a larger scale adoption of natural/organic personal care

The price premiums often accompanying ethically aligned personal care products are an ongoing obstacle to larger scale adoption

The 'greenwashed' consumer has become more discerning and less trusting about declarations of ethicality and sustainability

Lack of regulation for organic and Fairtrade products can create confusion and disengagement

Ethical shopping will sometimes be perceived as a hassle for time poor shoppers, which is why 'choice editing' has emerged as a credible retailing tactic

Key take-outs and implications: personal care players need to be proactive in addressing the obstacles impeding ethical and environmental consumerism

INSIGHT: Propensity to buy ethical products can be characterized by important age and gender distinctions, but there is a degree of commonality across socio-demographics

Most consumers recognize the importance of buying socially responsible products, irrespective of age or gender

Younger consumers are more likely to choose organic personal care products

Young male consumers demonstrated the most willingness to opt for more Fairtrade personal care products

There is little variance between gender and age groups in regards to attitudes surrounding sustainable packaging of personal care products

Attitudinal variances by age can be particularly marked in emerging markets where younger generations hold more cultural capital and are highly important agents of change

The advent of parenthood can have a profound impact on proclivity towards socially responsible products

Idiosyncratic personality traits can also help define the 'green' consumer segment

Key take-outs and implications: the appeal of various ethical and environmental benefits increasingly transcends socio-demographics albeit with nuances associated with the differing ethical issues

ACTION POINTS

ACTION: Ensure that more pertinent personal care product attributes are not compromised for ethical benefits

Reinforce the personal benefit of a product by clearly communicating 'win-win' scenarios when marketing ethicality and sustainability credentials

Ensure sensory benefits are not be compromised by an ethical proposition

Proactively substitute synthetic ingredients with certified organic and natural ingredients when feasible

Delivering ethics, while simplifying the application process, is a compelling benefit for time-poor altruistic consumers

If a real ethical/sustainability advantage exists, companies must use it to inspire customers and end consumers

ACTION: Market ethical personal care products as a positive lifestyle choice

Stress individual choice along with environmental benefits and focus on the positive emotions

Recruit passionate advocates to leverage the viral effect that is possible with compelling sustainability-led product and marketing concepts

Communicate the positive and 'cool' aspects of ethical consumerism

Use ethicality and environmentalism to leverage brand authenticity

ACTION: Ensure that ethical personal care claims deliver on their promises and thus serve to engender consumer trust

Adopt a longer term dedication to a particular cause to reinforce the integrity of a commitment

Be particularly attentive to brand trust indicators because it will influence the credibility (and effectiveness) associated with sustainability claims

Ensure that all sustainability claims are transparent, well-documented and measurable

Companies should be prepared to validate the scientific case behind each environmental and ethical claim

Ensure that ethical claims provide a complete picture of the environmental impact of a given product across the entire lifecycle

Marketing literature should be educational and engaging in order to spread awareness and create sustained interest

Tell a compelling brand or product story so that consumers are invested in the process

Embrace new communication platforms to help consumers make informed choices

Ensure flexibility in approach, especially in the more diverse, sizable emerging markets such as China

ACTION: Bring ethical beauty to mass market, but be wary of over-commercialization

From the top-down, develop strong corporate brands and ensure that their values are reinforced by individuals throughout the company

Use leading/flagship brands to demonstrate a wider commitment to ethicality and sustainability but also recognize that they will be held to higher scrutiny

Develop branded initiatives that enable consumers to more easily identify eco-friendly packages

Ensure that principles of ethicality are an important component of emerging market strategies

Consider acquisition as a more credible route to the ethical/sustainability market

Align with other industries and sectors where issues of ethicality and sustainability are also becoming pervasive

APPENDIX

Definitions

Supplementary data

Report methodology

Further reading and references

Ask the analyst

Datamonitor consulting

Disclaimer

List of Tables

Table 1: Consumer survey: the extent to which global citizens across 25 countries perceive global warming to be a serious problem, by country, 2007-2010

Table 2: Consumer survey: the extent to which global citizens across 25 countries perceive that protecting the environment should be given priority over economic growth, by country, 2007-10

Table 3: Consumer survey: perceived level of action taken by health and beauty retailers towards being more environmentally and ethically responsible, in 15 countries across Europe, Asia Pacific and the Americas, 2010

Table 4: Consumer survey: concern about parabens and petrochemicals used in personal care products, in 20 countries across Europe, Asia Pacific, the Americas, and South Africa, 2008 and 2010

Table 5: Consumer survey: concern towards knowing the ingredients used in cosmetics and toiletries, in 20 countries across Europe, Asia Pacific, the Americas, and South Africa, 2010

Table 6: Chemicals commonly found in personal care and household products with alleged health and safety problems

Table 7: Consumer survey: the extent to which consumers agree that health and beauty products formulated with natural ingredients are better for them, in 20 countries across Europe, Asia Pacific, the Americas, and South Africa, 2008 and 2010

Table 8: Consumer survey: the extent to which consumers agree that health and beauty products formulated with natural ingredients are equally effective as non-natural products, in 20 countries across Europe, Asia Pacific, the Americas, and South Africa, 2008 and 2010

Table 9: Organic and natural personal care markets in eight major European markets, by country and product type, 2004-14

Table 10: Organic and natural personal care markets in the US, Canada, Brazil, and Mexico, by country and product type, 2004-14

Table 11: Organic and natural personal care markets in six major Asia Pacific markets, by country and product type, 2004-14

Table 12: Organic personal care sales in MENA, by country, 2004-14

Table 13: Consumer survey: the importance attached to choosing grocery products supporting fair trade, in 20 countries across Europe, Asia Pacific, the Americas, and South Africa, 2008 and 2010

Table 14: Consumer survey: the extent to which consumers chose Fairtrade personal care products rather than standard variants more or less frequently in the past six months, in 15 countries across Asia Pacific, Europe, Latin America and North America, by country, 2008

Table 15: Fairtrade personal care sales in eight European countries, by country, 2004-14

Table 16: Fairtrade personal care sales in the US, Canada and Brazil, by country, 2004-14

Table 17: Fairtrade personal care sales in five Asia Pacific countries, by country, 2004-14

Table 18: Fairtrade personal care sales in KSA and UAE, by country, 2004-14

Table 19: Consumer survey: concern about whether beauty products have been tested on animals, in 20 countries across Europe, Asia Pacific, the Americas, and South Africa, 2008 and 2010

Table 20: Consumer survey: percentage of consumers who have ever heard of the term biodiversity, in 10 countries across Europe, by country

Table 21: Consumer survey: the extent to which consumers feel informed about the loss of biodiversity, in 10 countries across Europe, by country, 2010

Table 22: Consumer survey: the perceived seriousness of biodiversity at a global level, in 10 countries across Europe, by country, 2010

Table 23: Consumer survey: the extent to which consumers agree that halting the loss of biodiversity is a moral obligation, in 10 countries across Europe, by country, 2010

Table 24: Consumer survey: consumers' perception of the extent of grocery product over-packaging, in 20 countries across Europe, Asia Pacific, the Americas, and South Africa, 2008 and 2010

Table 25: Consumer survey: the extent to which consumers agree that many of the health and beauty products they use have too much packaging, in 17 countries across Asia Pacific, Europe, Latin America, MENA and North America, by country, 2009

Table 26: Consumer survey: the extent to which consumers agree that they will switch to another health and beauty product if they feel the packaging is difficult to recycle, in 17 countries across Asia Pacific, Europe, Latin America, MENA and North America, by country, 2009

Table 27: Consumer survey: perceived influence of published carbon accounting on health and beauty product purchasing decisions, in , in 15 countries across Europe, Asia Pacific and the Americas, 2010

Table 28: Consumer survey: importance of living an ethical or sustainable lifestyle in creating a feeling of wellbeing or wellness, in 15 countries across Asia Pacific, Europe, Latin America and North America, by country, 2008

Table 29: Consumer survey: frequency of consumers reading labels to check ingredient information on personal care goods, in 15 countries across Europe, Asia Pacific, South America and the US, 2008

Table 30: Consumer survey: the extent to which consumers are concerned about whether a beauty product's promise lives up to the claimed benefits, in 20 countries across Europe, Asia Pacific, the Americas, and South Africa, 2010

Table 31: Consumer survey: the extent to which consumers consider organic or natural claims made by cosmetics or beauty brands to be credible, in 20 countries across Europe, Asia Pacific, the Americas, and South Africa, 2010

Table 32: Consumer survey: the extent to which consumers consider ethical/sustainability claims made by cosmetic/beauty brands to be credible, in 20 countries across Europe, Asia Pacific, the Americas, and South Africa, 2010

Table 33: Consumer survey: agreement that people should be willing to pay higher prices in order to address global climate change in 25 countries, by country, 2009

Table 34: Consumer survey: willingness to pay for ethical and environmentally friendly health and beauty products, in 15 countries across Europe, Asia Pacific and the Americas, 2010

Table 35: Consumer survey: the extent to which consumers agree that organic beauty products are worth paying a bit extra for, in 17 countries across Asia Pacific, Europe, Latin America, MENA and North America, by country, 2009

Table 36: Consumer survey: the extent to which consumers agree that Fairtrade beauty products are worth paying a bit extra for, in 17 countries across Asia Pacific, Europe, Latin America, MENA and North America, by country, 2009

Table 37: Consumer survey: perception of corporations' ethical declarations, in 15 countries across Asia Pacific, Europe, Latin America and North America, by country, 2008

Table 38: Consumer survey: the extent to which ethics or sustainability benefits influence consumers' choice of personal care or beauty products, in 15 countries across Asia Pacific, Europe, Latin America and North America, by country, 2008

Abstract

• Comprehensive analysis of consumer values, attitudes and behaviors with regard to ethical and environmentally friendly consumption
• Detailed analysis of the most influential claims pertaining to ethicality and sustainability, with specific focus on the personal care sector
• Comprehensive market growth forecasts for the personal care natural/organic and Fairtrade market segments
• Covers personal care, across 20 countries in five regions, and incorporates mutiple waves of proprietary consumer research

• Understand consumer attitudes towards the most pertinent ethical and environmental issues to help inform communication strategies
• Improve your marketing by following best-practice guidelines enabling more effective targeting with 'on-trend' products and relevant communications
• Access data from multiple waves of primary research to increase the likelihood of being 'on-trend' with ethicality-led NPD and marketing activities

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