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Latest report from m1nd-set identifies strong potential for purpose-driven brands
Millennials’ are leading the purpose-driven purchasing drive in travel retail according to the latest consumer insights report from Swiss research agency m1nd-set. The report, which addresses shopper behaviour in travel retail as well as in downtown locations, looks at some of the key trends of sustainability shopping, including the segments most likely to purchase sustainable brands, price elasticity of sustainable products, the power of social media and peer-influencers on sustainable consumption and the key categories concerned by purpose-driven purchases. The report also looks at the dangers for companies if not seen to be respecting sustainable business practices.
Accordng to the report, 84% of shoppers interviewed from across all world regions shoppers think greater focus on sustainability by manufacturers has a positive impact on their perception of the brand. Unsurprisingly Millennials were among the segments with above-average scores, with 91% of shoppers from the age-group expressing this opinion. Women travellers and shoppers from Europe and North America also stand out with above-average percentages on the perception of sustainability about brands in the channel. m1nd-set reports that on average 72% of all shoppers in travel retail believe that a greater focus on sustainability by manufacturers increases the likelihood of purchasing a brand. This is particularly the case for Millennials and women travellers - 78% in each segment agree, while among regions, Europeans are the most likely to purchase a brand because of its sustainable qualities, with 77% in agreement.
The report reveals that 43% of shoppers in travel retail would actively look for more sustainable and environmental friendly products when shopping at the airport. Significant variations are seen when segmenting the data. 55% of Millennials and Females are proactive in their quest for greener purchases when shopping at airports, according to m1nd-set. When analysing the green shopping tendencies across regions, the report shows that 52% of both European travellers and North Americans are also above-average green-seekers in travel retail. The categories where more sustainable choices are more likely to be sought are Skincare (65%), Make-up (63%), Confectionery (56%) and Fashion & Accessories (50%). Among those who do not seek out sustainable products at airport shops, lack of time is the main reason, followed by a lack of trust in the sustainable certification, confusion about what is and is not sustainable, lack of interest and insufficient selection.
Price elasticity among sustainable goods in travel retail
m1nd-set’s sustainability report also shows that on average, 64% of global shoppers said they would be willing to pay more for a sustainable product in duty free and travel retail. Again women score higher with 70% willing to pay more, as for Europeans (69%) and North Americans (68%). Among all shoppers, 40% say they would be willing to pay up to 20% more for a sustainable product and 33% would pay up to 30% more. The report picks up on data reported by the TRBusiness-led industry sustainability initiative, the Travel Retail Sustainability Forum (TRSF), which estimates that the global travel retail industry is responsible for more than 10 billion plastic shopping bags being distributed annually. The m1nd-set report shows there is also a clear willingness among shoppers in travel retail to opt for more sustainable solutions for the shopping bag. 86% of all shoppers say they are willing to pay for a shopping bag, as long as it is reusable and not virgin plastic. Only 26% say they would rather not pay for their shopping bags, 19% are willing to pay for a reusable plastic shopping bag and 16% say they would rather bring their own reusable shopping bag.
Rethinking about refill
With water being one of the other key contributors to single-use plastic pollution in duty free and travel retail, with an estimated 3 billion plastic water bottles sold at travel retail outlets globally, the consumer attitude towards plastic water bottles is quite thought-provoking. m1nd-set says there is a clear preference to eliminate single-use plastics for water consumption as 71% of shoppers say they would prefer to refill their reusable water bottles for free with tap water from a water fountain. 76% of Millennials expressed this preference 68% however, would be willing to pay for mineral or filtered mineralised water from a dispenser using their refillable bottles, while only 7% would prefer to continue purchasing water in a single-use plastic bottle.
m1nd-set owner and CEO Dr. Peter Mohn commented: “We see from the research that Sustainability is more than a buzz word or hot-topic. It has become a fundamental part the consumer experience for a broad section of shoppers today, in travel retail specifically as well as retail in general. Purpose-driven brands and companies have the power to unite consumers, develop and increase loyalty. Consumers are increasingly conscious of the need to be more responsible socially and environmentally, when shopping, travelling or dining out. It’s also important to note that sustainable brands are more resistant to price hikes as consumers clearly express they are willing to pay more for purpose-driven products and services.”
As Mohn goes on to explain, it is essential for companies to increase their communication around their sustainable approaches: “It’s clear from our research that the majority – in most cases, a large majority – of consumers would switch to a purpose-driven brand, i.e. a brand with clear socially responsible or environmentally friendly attributes. However, it’s also important to note that around two thirds of shoppers will take action if a company fails to meet consumer expectations on social and environmental responsibility. This does not just refer to how products are sourced or manufactured but also how they are packaged” Mohn added.
The report also focuses on consumer attitudes to packaging. More than 7 out of 10 of shoppers believe that brands and retailers are currently not doing enough to provide more environmentally-friendly packaging. Consumers are increasingly influenced by social media coverage of plastic pollution and the dangers to the environment of packaging waste and it’s estimated that between 60% and 70% of shoppers, depending on the market, will change their purchasing behaviour because of their concerns about packaging. Only 25% of consumers however say it’s important for packaging to have a luxury aspect, according to the report.
A fairer future
The report concludes with a look at the future development of sustainable brands. Analysing sales growth across all product categories over recent years, m1nd-set reports that sales growth is driven predominantly by sustainably marketed goods such as those with Fair Trade or other sustainable certification, despite representing less than a fifth of all goods sold currently. This shift in priorities has been particularly significant over the past five years, according to m1nd-set, with sales of sustainable goods growing six times faster than other products. The Swiss research agency predicts this growth will be stronger still in the coming years as purpose-driven companies produce more effective environmentally friendly products, supported by growing consumer demand for such goods.
“While consumers are leading the demand for more purpose-driven products, industry leaders are also calling for a shift towards more responsible production and consumption, even a more responsible, purpose-driven economic system as opposed to profit-driven” Mohn concludes.
“Structural change is necessary in order to address climate change according to several leading CEOs, who are expressing their disdain in increasing numbers with climate change, ocean pollution, deforestation, social inequalities and human rights abuses. With change driven from both top-down and bottom-up, we believe we’re going to see a paradigm shift in the way companies source, produce, package and sell. This is a global shift, driven by multinationals across all sectors, from consumer goods to technology and even financial institutes. It’s no longer a question of if or when, but how many, how soon and whether your company will be leading or lagging.”
For more information, please contact m1nd-set: firstname.lastname@example.org.