Consumers Are Increasingly Acting on Their Ethical Beliefs
As ethical consciousness has grown, ethical purchasing behavior
has followed suit. From its humble beginnings in the 1950s, fair
trade has developed into a global movement. Such products meet
both social and environmental standards set by the group, creating a
fair deal for producers and minimal environmental impact. Another
important driver of fair trade purchases is the perceived authenticity,
detail, and overall sense of provenance associated with such products. Consumers increasingly want to become engaged with issues
such as origin and production details. Fair trade labeling is something that gives them a degree of confidence over these issues.
In the past five years fair trade sales have experienced double
digit growth across Europe and the United States. In Europe, the
UK remains the largest market for fair trade products with a value of
around $775 million in 2007, followed by France and Germany with
a value of $299 million and $194 million respectively. By 2012, the
UK market for fair trade is forecast to exceed $1.5 billion. The most
important fair trade markets are the UK and United States based on
and sports equipment. For instance,
leading UK retailer Marks & Spencer
launched a whole fashion range produced with fair trade cotton in 2007
as part of their “Plan A” initiative.
Indeed, The Cooperative Bank’s 2007
ethical consumerism report entitled
“The Ethical Consumerism Report”
noted that boycotts of clothing
brands perceived to be unethical will
continue to grow until there are
more accessible high street options
for ethical clothing.
Table 1. Fair trade overall product sales by country, 2007.
current sales. However, growth in countries such as Australia, Spain,
Sweden and Germany is likely to drive the market on further.
Fair trade coffee and tea have become hugely popular, especially
in the UK and United States where such products are available in
many supermarkets and coffee shops. In the UK fair trade beverages
currently account for $380 million and are forecast to grow at a
CAGR of 15. 7 percent between 2007 and 2012. In the United States,
the fair trade beverage market accounted for $437 million in 2007
and is forecast to grow at a similar CAGR of 14.9 percent between
2007 and 2012. In 2007, 6. 5 percent of all new beverage product
launches in the United States carried a fair trade label according to
Datamonitor’s Productscan database.
The food category is only narrowly smaller than the beverage
market in most countries, enjoying strong growth in products such
as bananas and chocolate. The “other” fair trade product category is
seeing the fastest growth due to a number of new fair trade products
becoming available in the last few years including cotton, clothing
There Remains a “Disconnect”
Between Attitudes and Behavior
Though positive attitudes towards
ethical consumption are beginning to
translate into actual behavior, there
still a sizable difference between consumer’s ethical beliefs and their actual shopping habits. Datamonitor’s
2006 consumer survey found that 57
percent of United States and
European consumers thought it was
important to buy ethically, yet only a
quarter reported actually making
more ethical purchases in 2006.
Despite becoming more environmentally conscious, people are still somewhat confused about the consequences and the solutions of sustainability and require more education.
Many people are confused by the
myriad of terms, such as “green”,
“sustainability” and “footprints,”
found in the media. According to a
study by Landor, in June 2006 in the
United States, Americans don’t often
make time to learn about the environmental impact of their purchases.
The study found that 37 percent of
the general population were unable
to determine what makes a truly
“green” brand. Meanwhile, according
to The Waste & Resources Action
Programme (WRAP) in the UK,
despite the recent emphasis on going
“green,” people are still confused
about many of the issues. WRAP concluded that the industry requires better product labeling to help educate
