As the European market for natural and organic cosmetics gets ready to break the $2 billion barrier for the
first time this year, there’s greater interest in fair trade policies as well as green chemistry and
packaging. According to new report on fair trade cosmetics and ingredients from Organic Monitor,
many companies are implementing fair trade sourcing policies, with some launching certified fair
trade products. Most product launches have been in the French market, which now has the largest
number of cosmetic products with the internationally recognized Fair Trade mark.
According to Organic Monitor, although The Body Shop has been the pioneer in ethical sourcing
with its Community Trade program, the company is losing out to newcomers. A number of natural
and organic cosmetic companies are setting up fair trade grower projects in Africa, Asia and Latin
America. Some are growing endangered plant species and investing in social community projects.
The London-based consultancy’s report evaluates the business potential of fair trade cosmetics
and ingredients, giving details of standards, certification and market potential. The study predicts
adoption rates to rise as natural and organic cosmetic products become mainstream and as more certified fair trade ingredients become available. A major restraint to market growth is the limited
number of certified fair trade ingredients.
According to Organic Monitor, the mainstreaming of the natural and organic cosmetics market is
encouraging fair trade practices. Firms such as Weleda, for example, are investing in fair trade projects to guarantee supply of organic ingredients and to encourage sustainability. The entry of large
cosmetic companies and leading retailers is straining supply of natural and organic cosmetic ingredients. Corporate social responsibility is also coming to the forefront as brands compete for limited
retailer shelf space.
With a growing number of natural and organic cosmetic companies adopting fair trade practices,
Organic Monitor predicts some convergence between standards. A number of organic certification
agencies are already integrating fair trade practices into their standards, and this will enable cosmetic companies to bridge the gap between green and ethical products, according to organization,
and the markets for fair trade cosmetics is expected to rise, the organization noted.
More info: www.organicmonitor.com
80% OF U.S.
According to new research by Natural Marketing Institute (NMI), more than 80% of the total U.S. adult pop-
ulation shows some type of green motivation. While LOHAS consumers (those identified as having the strongest environmental, social, and corporate social responsibility values and behaviors)
represent just 17% of U.S. adults ( 38 million consumers), NMI has identified three other segments
that are also engaged in various realms of sustainability depending on the eco-dimension that aligns
with their overall priorities. Here are other segments identified by NMI:
Naturalites (17% of all U.S. adults)—This group is driven by personal health and wellness and
adhere to a healthy lifestyle. They are high purchasers of eco-consumables, want to do more for the
environment and are loyal to those companies/brands who practice credible CSR.
Drifters (24% of all U.S. adults)—Driven by trends, drifters are currently engaged in sustainability though their behaviors are not deeply rooted. They are price sensitive and are more likely to be
eco-concerned if affected personally.
Conventionals (26% of all U.S. adults)—This very practical segment does not have a green attitude but does have some environmental behavior such as recycling, energy conservation, and other
similar behaviors. This segment’s behavior is driven more by cost savings or a desire to waste less
than by environmental consciousness.
Unconcerned (16% of all U.S. adults)—While not necessarily against the environment, this group
is not actively engaged in protecting it, buying green products or CSR.
According to NMI managing partner Steve French, while the percentage of LOHAS consumers
has remained stable since 2005, all of the other segments show noteworthy shifts. The so-called
drifters and conventionals, in particular, have increased significantly, which is reflective of both rising environmental and social concerns, as well as the current economic situation, said NMI.
NMI notes that marketers will continue to find value in understanding the attitudes and behavior of LOHAS consumers, as they are bellwethers of more mainstream consumers’ future behavior.
Having driven the market, they are now discovering the next generation of green and socially conscious products. Given the growth in drifters, marketers need to communicate the caché and
camaraderie that a green lifestyle creates. The growing conventionals segment will respond to
messages of practicality or financial savings that can accompany a sustainable lifestyle, as with
taking a reusable shopping bag to the store or driving less.