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The Ethical Consumer - US - July 2015

Published By :

Mintel

Published Date : Jul 2015

Category :

Lifestyle

No. of Pages : N/A


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.

Overview

What you need to know
Definitions

Executive Summary

The issues
People expect ethical behavior – What is the best way to communicate the message?
Figure 1: How often ethics influence purchasing decisions, April 2015
Confusion over ethical terms and icons may lead to rejection
Figure 2: Attitudes toward ethical claims, icons, and terms, April 2015
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
Figure 3: Actions taken related to company ethics, April 2015
The opportunities
Ethics matter – and people feel they’re becoming even more important
Clearer marketing messages can boost the positive effect of ethics
A misstep can be used to demonstrate commitments toward improving
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*
‘Environmentally friendly package’ accounts for more than half of ethical claims
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
Marketing efforts promote ethics, education, engagement
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
In their words – The most ethical companies
“Unethical companies” reputations influenced by well-publicized scandal
In their words – The least ethical companies

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
In their words

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
In their words

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
In their words
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
Consumer survey data
Consumer qualitative research
Abbreviations and terms
Abbreviations

Appendix – 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*

Appendix – 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

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