Table of Contents
Executive Summary
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- The market
- Strong sales growth for ethical food and drink over 2013-18
- Inflation and slowing volume sales anticipated for 2019-23
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- Figure 1: Retail value sales of food and drink with selected leading ethical certifications^, 2013-23
- War on plastic continues
- Food waste comes under increased government scrutiny
- Companies and brands
- Companies take action on plastic
- More free-range claims in animal welfare
- Sustainability is a major theme in advertising over 2017-19
- The consumer
- Eight in ten adults have bought food/drink with ethical certifications
- Free-range is the most widely bought food with ethical certification
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- Figure 2: Awareness and purchase of food/drink with ethical certifications, by type, February 2019
- Various factors underpin buying of ethical food and drink
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- Figure 3: Reasons for buying ethical food and drink, February 2019
- Price is the principal barrier to buying ethical food and drink
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- Figure 4: Barriers to buying ethical food and drink, February 2019
- Animal welfare, packaging and food waste are key influences on food and drink buying
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- Figure 5: Important factors in food and drink buying decisions, February 2019
- Ethical aspects encourage loyalty and spark the feel-good factor
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- Figure 6: Behaviours relating to ethical food and drink, February 2019
- Future direction of the economy is crucial for ethical food and drink
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- Figure 7: Attitudes towards ethical food and drink, February 2019
- What we think
Issues and Insights
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- Various options for companies to overcome the price barrier
- The facts
- The implications
- Educate consumers about ethical food and drink to boost uptake
- The facts
- The implications
- Need to reassure consumers that their actions make a difference
- The facts
- The implications
The Market – What You Need to Know
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- Strong sales growth for ethical food and drink over 2013-18
- Inflation and slowing volume sales anticipated for 2019-23
- War on plastic continues
- Food waste comes under increased government scrutiny
Market Size, Segmentation and Forecast
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- Increased distribution drives rapid growth in ethically certified food and drink over 2013-18
- Fairtrade and Rainforest Alliance become increasingly mainstream
- Supermarkets build up their organic ranges
- MSC-certified fish and shellfish rapidly gains retail share
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- Figure 8: Value sales of food and drink with selected leading ethical certifications, 2013-18
- Inflation and improved household incomes boost sales in 2018
- Sales growth to slow over 2019-23
- Inflation expected in line with overall food market 2019-23
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- Figure 9: Retail value sales of food and drink with selected leading ethical certifications^, 2013-23
- Figure 10: Retail value sales of food and drink with selected leading ethical certifications^, 2013-23
- Forecast methodology
Market Drivers
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- War on plastic continues
- Government tax plans add urgency for manufacturers to use recycled plastic
- Companies which switch to recycled packaging early should benefit
- Governments plan to introduce deposit return schemes for drinks packaging
- Supermarkets trial deposit return schemes
- Technical issues for manufacturers in creating biodegradable packaging
- Initiative to turn food waste into plastic packaging receives government funding
- Food waste comes under increased government scrutiny
- Widespread concerns about food waste among consumers
- Retailers and manufacturers commit to halving food waste by 2030
- Supermarkets take various steps to limit avoidable food waste
- UK’s low self-sufficiency in food raises concerns
- Questions surround Brexit and its potential impact on legislation
- State of the economy is crucial for ethical food and drink
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- Figure 11: CPI vs average weekly earnings, January 2013-October 2018
- Scientists advise the public to reduce meat and dairy consumption
- Strong growth for meat-free foods and dairy alternatives
- Animal welfare concerns help to drive the meat reduction trend
- Parliamentary committee calls for international agreement to protect the world’s oceans
- Livestock industry makes progress on antibiotics reduction
- Eat organic meat and poultry to help combat antibiotic resistance, advises the Chief Medical Officer
Companies and Brands – What You Need to Know
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- Companies take action on plastic
- More free-range claims in animal welfare
- Sustainability is a major theme in advertising over 2017-19
Launch Activity and Innovation
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- Overview
- Environmentally friendly packaging remains the leading ethical claim
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- Figure 12: Launches in the UK food and drink market, by selected ethical claims, 2015-19
- Bottled water brands explore recycled plastic
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- Figure 13: Evian water bottles made with 50% recycled plastic, 2018
- Leading and smaller brands turn to recycled plastic for sweet treat packaging
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- Figure 14: Thorntons explores use of part-recycled plastic, 2019
- Brands and retailers take action on plastic waste
- Supermarkets remove plastic packaging from fresh produce
- Replacing black plastic
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- Figure 15: Examples of ready meals launches using alternatives to black plastic, 2019
- The Collective alters dye for yogurt pot lids
- M&S launches ‘plastic take-back’ initiative
- Various brands link with Terracycle on recycling schemes
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- Figure 16: Hovis Facebook advert for its recycling scheme, 2018
- Baby food brand launches ‘zero waste’ scheme
- Supermarkets invite shoppers to bring in their own containers for meat and fish
- Asda looks to encourage recycling with milk bottle app
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- Figure 17: Asda promotes its recycling app on on-pack labels for its own-label milk, 2019
- Biodegradable claims remain rare
- Leading and niche brands release biodegradable tea bags
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- Figure 18: Examples of tea launches with compostable tea bags, 2018
- Niche coffee brand unveils biodegradable coffee pods
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- Figure 19: Example of biodegradable coffee capsules, 2018
- Multiple claims used to build all-round ethical positioning
- PG Tips goes biodegradable and puts stronger emphasis on Rainforest Alliance links
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- Figure 20: PG Tips makes multiple ethical and environmental claims, February 2018
- Smaller brands highlight eco-friendly packaging and charity links
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- Figure 21: Smaller brands highlight eco-friendly packaging and charity links, summer 2018
- Rise in sustainable claims
- Tesco completes move to 100% sustainable chocolate
- Free-from brands are the most active in promoting their use of alternative energy
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- Figure 22: Examples of free-from launches referencing use of alternative energy on-pack, 2018
- Dairy brands flag up their green credentials
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- Figure 23: Examples of dairy launches referencing use of alternative energy on-pack, 2018
- Start-up looks to set new standard on sustainable fish
- Iceland launches fish fillets bag of solely bycatch species
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- Figure 24: Iceland puts the spotlight on lesser-known fish species, September 2018
- Iceland removes palm oil across its own label range
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- Figure 25: Iceland flags up the absence of palm oil on-pack, 2018
- New packaging features aim to prevent food waste
- Organic brands look to make the benefits of organic more tangible
- Sweet treats highlight soil health and supporting the local environment
- Organic tea brand makes conservation statement
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- Figure 26: Organic brands look to make the environmental benefits more tangible, 2018-19
- Animal welfare claims remain niche
- Free-range claims appear on white milk…
- …spoonable and drinking yogurts…
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- Figure 27: Examples of free-range milk and yogurt launches, 2017-19
- …and cream
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- Figure 28: The Free Range Dairy Facebook advert for its clotted cream, 2019
- New fruit and vegetables brand aims to make organic more affordable
Start-ups and Disruptors Case Studies – Toast Ale
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- Company overview
- What is it?
- Founded
- Company mission statement
- Founders’ story
- Mintel analyst view
- Mintel Trends
- Why it could succeed
- Why it could fail
- The verdict
- Product information
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- Figure 29: Toast Ale, March 2019
- Media profile
- Social media metrics
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- Figure 30: Social media metrics for company as of March 2019
- The brand’s view
- Revenue in the last year (as of 1st December 2018):
- Sources of funding and support
- Target audience
- What consumer needs does the range meet?
- Product stockists
- Looking to the future
Start-ups and Disruptors Case Studies – Garçon Wines
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- Company overview
- What is it?
- Founded
- Company mission statement
- Founders’ story
- Mintel analyst view
- Mintel Trends
- Why it could succeed
- Why it could fail
- The verdict
- Product information
- Media profile
- Social media metrics
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- Figure 31: Social media metrics for Garçon Wines as of March 2019
- The brand’s view
- Sources of funding and support
- Target audience:
- What consumer needs does the range meet?
- Product stockists
- Looking to the future
Advertising and Marketing Activity
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- Overview
- Tesco presents sustainable chocolate as extra permissible
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- Figure 32: Outdoor advert from Tesco promoting its sustainable chocolate sourcing, 2019
- Supermarkets focus on provenance and traceability
- The Co-op plays up support for farmers and communities
- Morrisons emphasizes close relationship with suppliers
- Waitrose highlights responsible sourcing for fish and dairy cows’ grazing access
- Iceland Christmas advert reignites the palm oil controversy
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- Figure 33: Iceland anti-palm oil Christmas TV advert, 2018
- War on plastic ramps up
- Soda Stream urges the public to give up bottled water to save the planet
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- Figure 34: Soda Stream ‘Time for a Change’ TV advert, 2018
- Thames Water also moves against bottled water
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- Figure 35: Thames Valley ‘Tap Tastic Not Plastic’ direct mail advert, 2018
- WWF runs the #UseLessPlastic twitter campaign
- Animal welfare
- Vegan groups continue to criticise the dairy industry
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- Figure 36: Anti-dairy adverts from vegan organisations, 2017-18
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- Figure 37: Advert from Viva! Mother’s Day campaign, 2019
- High-welfare dairy systems take to social media
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- Figure 38: YouTube adverts from high-welfare dairy systems, 2018
- CIWF brings to light the ‘sad truth about parmesan’
- Riverford portrays organic eggs as the best option to ensure animal welfare
- Veganuary urges the Prime Minister to join the campaign
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- Figure 39: Veganuary outdoor advert, 2019
- Organic UK portrays organic food as better for environment and health
- …and looks to explain the meaning of organic
The Consumer – What You Need to Know
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- Eight in ten adults have bought food/drink with ethical certifications
- Free-range is the most widely bought food with ethical certification
- Various factors underpin buying ethical food and drink
- Price is the principal barrier to buying ethical food and drink
- Animal welfare, packaging and food waste are key influences on food and drink buying
- Ethical aspects encourage loyalty and spark the feel-good factor
- Future direction of the economy is crucial for ethical food and drink
Awareness and Purchase of Food and Drink with Ethical Certifications
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- Eight in ten adults have bought food/drink with ethical certifications
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- Figure 40: Awareness and purchase of food/drink with selected ethical certifications, February 2019
- Over-55s are key buyers of ethical food and drink
- More women than men buy ethically certified food and drink
- Over half of adults buy three or more types of ethical food and drink
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- Figure 41: Buying repertoire of food/drink with ethical certifications, February 2019
Awareness and Purchase of Food and Drink with Ethical Certifications by Type
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- Free-range is the most widely bought food with ethical certification
- No bias in free-range buying by financial health
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- Figure 42: Awareness and purchase of food/drink with ethical certifications, by type, February 2019
- Free-range milk
- Half of adults buy Fairtrade food and drink
- Fairtrade should benefit from highlighting its environmental credentials more
- Environmental sustainability chimes most with under-35s
- Urgent need in some categories to reassure younger consumers on the environment
Reasons for Buying Ethical Food and Drink
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- Animal welfare is the top reason for buying ethical food and drink
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- Figure 43: Reasons for buying ethical food and drink, February 2019
- Four in ten buyers are driven by environmental concerns
- Strong overlap between animal welfare and environmental considerations
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- Figure 44: Examples of food launches with both an animal welfare and an environmentally friendly packaging/product claim, 2018
- A desire to avoid unwanted ingredients motivates a quarter of buyers
- Younger Millennials are especially likely to see certified products as healthier than standard versions
- Organic buyers see a strong health halo for certified food/drink
- …as do buyers of MSC fish
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- Figure 45: Example of MSC-certified product promoting wild-caught fish as a healthier choice, 2019
Barriers to Buying Ethical Food and Drink
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- Price is the principal barrier to buying ethical food and drink
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- Figure 46: Barriers to buying ethical food and drink, February 2019
- Need for retailers to highlight where ethical products do not carry a price premium
- Presenting ethical products as the savvy option should boost sales
- Discounters can help to drive uptake
- Consumers’ trust in standard products hinders uptake of ethical food and drink for a small minority
- One in five are unsure about what the different certifications stand for
- Need for producers to make their differences from standard practice more tangible
Important Factors in Food and Drink Buying Decisions
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- Animal welfare sways 45% of food and drink buyers
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- Figure 47: Important factors in food and drink buying decisions, February 2019
- Strong overlap in interest in welfare of animals and supporting farmers
- High-welfare producers are not getting the full benefit of consumer concerns around animal welfare
- Making animal welfare policies more tangible would help high-welfare systems to attract ‘missing’ users
- Videos of farms would help to tangibly demonstrate welfare standards and transparency
- Environmentally friendly packaging is valued by four in ten
- Consumer expectations add to the urgency for companies to tackle plastic waste
- Need for companies using sustainably sourced cardboard to highlight this more strongly on-pack
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- Figure 48: Examples of food/drink launches highlighting sustainable cardboard sourcing, 2018
- Food waste is neck-and-neck with packaging in consumers’ priorities
- In-store recipe cards on using up leftovers would help to reduce food waste
- Strong overlap in packaging and food waste concerns
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- Figure 49: Waitrose pasta with packaging made partly from food waste, 2019
- Over-55s are particularly keen to support local producers/farmers
- Promoting local produce would help to spark the feel-good factor
- Antibiotic-free labels appeal to a quarter
Behaviours Relating to Ethical Food and Drink
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- Seven in ten adults have made efforts to reduce plastic packaging use
- Concerns about food waste set challenge for companies looking to reduce packaging
- Many are amenable towards using their own containers at supermarkets
- Eco-friendly packaging is well-placed to appeal
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- Figure 50: Behaviours relating to ethical food and drink, February 2019
- Half of adults are loyal to companies whose ethics align with their own
- Need to put ethical claims directly in the path of shoppers
- Strong feel-good factor around ethical food and drink buying
- Need to reassure consumers that their actions make a difference
Attitudes towards Ethical Food and Drink
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- Widespread expectations on retailers to reduce packaging waste
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- Figure 51: Attitudes towards ethical food and drink, February 2019
- Future direction of the economy is crucial for ethical food and drink
- High-welfare producers can benefit from promoting a ‘less but better’ mentality
- Widespread uncertainty over whether independent ethical schemes are superior to those from companies
- Ethical buying is strongly linked with social image for the young
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
Appendix – Market Size and Forecast
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- Forecast methodology
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- Figure 52: Forecast of UK value sales of food and drink with selected leading ethical certifications^, best- and worst-case, 2018-23
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