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The Ethical Consumer - US - July 2015

The Ethical Consumer - US - July 2015

"Ethics have become increasingly important to a company’s reputation. In the internet age, consumers can easily access information on a company’s ethical track record and opinions (both positive and negative) can spread quickly through social media. Due to a nearly ceaseless stream of information, consumers are bombarded with issues to care about, and many do feel that they should take a stance in support of or against differing opinions. How they go about showing or demonstrating a commitment, however, varies from passive avoidance (ie, inaction) to zealous evangelism."

- Lauren Bonetto, Lifestyles & Leisure Analyst

This report discusses the following key issues:

People expect ethical behavior – What is the best way to communicate the message?
Confusion over ethical terms and icons may lead to rejection
Taking a stance on a polarizing issue can attract and repel
Big companies struggle with an image problem
Consumers more likely to punish the bad than to reward the good


OVERVIEW
What you need to know
Definitions
EXECUTIVE SUMMARY
The issues
Figure 1: How often ethics influence purchasing decisions, April 2015
Figure 2: Attitudes toward ethical claims, icons, and terms, April 2015
Figure 3: Actions taken related to company ethics, April 2015
The opportunities
What it means
THE MARKET
What you need to know
Ethical claims grow significantly over past 10 years
Ethics stand to become even more important in the future
Ethical product launches
Ethical claims attached to nearly one third of products
Figure 4: Share of total US product launches with an ethical claim, 2006-15*
Figure 5: Share of US product launches with an ethical claim, by ethical claim type, 2006-15*
While most categories see growth, BPC and health somewhat stagnant
Figure 6: Share of US product launches with an ethical claim, by product category, 2006-15*
Market factors
As Millennials become full-fledged adults, ethics become increasingly important
Figure 7: Population by generation, 2010-20
The ‘connected’ consumer may be a more ‘concerned’ consumer
Median household income slowly begins to rise
Figure 8: Median household income, in inflation-adjusted dollars, 2003-13
KEY PLAYERS
What you need to know
What’s working: Putting people ahead of profits
What’s struggling: BIG – Big companies, big box retailers, big banks, big oil
What’s next: LGBT rights, living wage, gender equality
What's working
Putting people ahead of profits
Promoting the brand over the product
Case studies
Chipotle
Figure 9: “Farmed and Dangerous Official Trailer,” online video, 2014
Whole Foods Market
Figure 10: “Values Matter Anthem,” online video, 2014
What’s struggling?
Big companies struggle to cultivate an ethical image
Big box retailers both loved and loathed
Fast food restaurants continue to be served with blame
Big banks and big oil
What’s next?
In wake of Supreme Court ruling, LGBT community cannot be dismissed
Minimum wage increasingly thought of as unliveable
Feminism enjoys renaissance
THE CONSUMER
What you need to know
Majority of consumers area at least somewhat influenced by ethics
Top concerns include employee treatment, provenance, sustainability
Big companies make big targets
Consumers more inclined to punish “bad” companies than to reward “good” ones
Bouncing back after an ethical dilemma
Influence of ethics on purchasing decisions
Seven in 10 consumers at least somewhat influenced by company ethics
Figure 11: How often ethics influence purchasing decisions, April 2015
Men, higher income, younger consumers most impacted by ethics
Figure 12: Purchasing decisions are often/always influenced by ethics, by gender and age and by parental status, April 2015
Ethical factors considered
Top concerns include employee treatment, provenance, sustainability
Figure 13: Factors considered to determine how ethical a company is, April 2015
Those who are influenced may seek to reward or punish companies based on ethics
Figure 14: Top factors considered to determine how ethical a company is, by those who say company ethics influence their purchasing
decisions, April 2015
Notorious and noted companies
Big companies make big targets
Figure 15: Top 20 companies mentioned as especially ethical or especially unethical, April 2015
Consumers want to believe the best of brands they often use
“Unethical companies” reputations influenced by well-publicized scandal
Actions taken in response to company ethics
Consumers prefer to support ethical companies without spending money
Figure 16: Actions taken related to ethical/unethical companies – Telling others, April 2015
Consumers more inclined to punish the bad than reward the good
Figure 17: Actions taken related to ethical/unethical companies – Purchasing, April 2015
Young men especially engaged, Millennials least likely to ‘do nothing,’ parents set an example through ethical
purchases
Figure 18: Actions taken related to ethical/unethical companies – Social media and purchasing, by gender, young age, generation,
parent status, April 2015
Ethical icon recognition
Using icons to communicate ethics may not be effective
Figure 19: Icon recognition, April 2015
Icons speak more to Millennials
Attitudes toward claims, icons, terms reveal skepticism and confusion
Figure 20: Attitudes toward ethical claims, icons, and terms, April 2015
Attitudes and opinions toward ethics
Size matters – Large companies thought of as unethical
Figure 21: Attitudes toward company size, by gender and age, April 2015
Bouncing back after a scandal
Figure 22: Skepticism toward company ethics, by gender and age, April 2015
Supporting ethical companies makes consumers feel good
Figure 23: Personal feelings about company ethics, by gender and age, April 2015
Consumer segmentation
Figure 24: Ethical Consumer segmentation, April 2015
Ethics and the City (35%) – The young, urban, and influenced
Lost Causes (39%) – Ethics on the outs with older, suburban consumers
Wanting to be Won (26%) – Selective but dedicated
Figure 25: Attitudes toward company ethics, by ethical consumer segments, April 2015
APPENDIX
Data sources and abbreviations
Data sources
Abbreviations and terms
The market
Figure 26: Share of US product launches with an ethical claim, by ethical claim type, 2006-15*
Figure 27: Share of US product launches with an ethical claim, by product category, 2006-15*
Figure 28: Share of US product launches with an ethical claim, by product category and by ethical claim type, 2014-15*
Qualitative research
The most ethical companies
The least ethical companies
Consumers who are influenced by ethical efforts
Consumers who are not influenced by (or are averse to) ethical efforts
Attitudes toward company size
RESEARCH METHODOLOGY
US Research Methodology
Consumer research
Social Media Research
Trade research
Statistical Forecasting

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