Recession not driving ethical spending underground

By staff reporter

- Last updated on GMT

Related tags Economics Marketing Marketing research

Tighter purses are not turning consumers away from ethical shopping with interest in all things sustainable or humane thriving despite the recession, according to market researcher, Packaged Facts.

Its report found the recession had not wilted sales in eco-friendly and green items; natural and organic; humane and fair trade with a third of adults willing to pay more for organic goods and a quarter frequently purchasing them.

Packaged Facts acknowledged that price sensitivity was heightened during recessionary times, but identified that ethical consumption concerns had become such a priority with consumers that they were willing to pay more for products that matched their value systems.

"With the economy foremost in consumers' minds, heightened price sensitivity in the midst of the current recession is inevitably having an effect on the market for ethical products,"​ said Packaged Facts publisher, Don Montuori.

"However, our survey indicates that more shoppers understand the environmental, social, and economic implications of their choices. The result is a sizeable number of consumers who will purchase typically more expensive ethical products even in economically challenging times."

In five years, consumption of ethical products had grown at around 10 per cent per annum and will continue at a similar level until 2014 when the market would be worth $62bn from $38bn in 2009.

These figures includes both foods and non-food items such as personal care products and household products such as paper goods, diapers and cleaning products. Indeed, these items will grow at 80 per cent compared to 57 per cent for food products, although they account for lower volume sales.

Packaged Facts noted marketers and retailers were making greater efforts in the ethical space such as green facilities and cause-related marketing efforts as well as private-label organic food offerings and natural household products.

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