UK ethical market 2010


Ethical Consumption Still On The Up

Britons’ spending on ethical goods rose by nearly a fifth over two years, despite the economic downturn.

Who said that ethical brands would be the first scrubbed off the shopping list once a recession bit?  Many people would have referred to basic economic theory, seeing ethical brands as ‘luxuries’ which, in times of hardship, the rational consumer would cut back on, only buying ‘necessities’ and of those, the cheapest brands available. Or so some thought.

This theory would appear to have been torpedoed by the Co-operative Bank’s Ethical Consumerism Report, for which we here at ECRA provide the underlying research. The ethical market in the UK was worth £43.2bn in 2009 compared with £36.5bn two years earlier – an increase of 18%. While this remains a small proportion of the total annual consumer spend of around £700 billion, the report shows that growth in ethical consumerism continues to outstrip the market as a whole.

Much of this can be traced to everyday goods that we all put in our shopping basket. Fairtrade food grew by 64% over the two years to reach sales of £749m, while sales of the RSPCA-backed Freedom Food products tripled to reach £122m. Sales of ethical personal products, including clothing and cosmetics, increased by 29% to reach £1.8bn. The only area to see a decline over the two year period was organic food, which slumped by 14% to £1.7bn after a period of double digit growth.

The role of big companies
The surge in ethical cosmetics owed much to Marks and Spencer’s decision to have all its own brand products sport the Leaping Bunny logo. Elsewhere, the likes of PG Tips and Mars have embraced the perhaps-not-so-rigorous but nevertheless more than just green-wash Rainforest Alliance, and Cadbury’s have put the weight of Britain’s favourite chocolate brand – Dairy Milk – behind Fairtrade.

Other recession-specific developments
A decline in spend on energy efficient light bulbs was accounted for due to discounting by retailers, in fact sales by volume were up.  A 23% growth in eco-travel and transport spend was mainly accounted for by increased sales of ‘green’ cars, use of public transport and travel boycotts.

Monies in ethical finance, including ethical banking , investments, shareholdings and credit unions, also grew by 23%. Recent events in the financial services sector have helped the ethical finance market as people have moved their money to what they see as safer and more trusted institutions and funds.

Perhaps the shape of the future is here for all to see?

Download the full report >