An overview of ethical markets in the UK

Here we provide an up-to-date overview of UK ethical markets using data from our Ethical Consumer Markets Report.

We provide information on the ethical food, home, travel, transport, personal products, community and finance sectors. We include key figures on growth, and provide forecasts for the future of ethical spending in the UK based on attitudinal survey data. 

Overview of current ethical markets in the UK

Overall, ethical consumer spending in the UK is growing. Our figures show that the value of ethical spending in the UK has doubled in the past decade. In 2010 ethical spending was estimated to be worth around £46bn. This figure reached £98bn in 2019 (which is up by 13%, or almost £11bn, from the previous year). 

These figures are drawn from our annual Ethical Consumer Markets Report, which analyses ethical spending habits in the UK each year. Your can download the current report here.

Our research also found that younger people are more likely to buy fair trade, organic, second hand and plant-based products. They are also more likely to avoid companies involved in workers' rights issues, try to buy less meat, and cycle. The only ethical market that older people were more likely to support in comparison with younger people was buying from local shops.

Read on for a breakdown of ethical spending in different market sectors. 

Ethical Food & Drink

Figures show that sales of ethical food products increased at a faster rate during the pandemic.

Ethical retailer Suma said “Changes in buying habits are usually gradual” but this is “not so with Covid19.” They suggest that during Covid pro-active self-care was on the rise, and people were becoming more conscious of food provenance and ethical sourcing. Younger age groups were especially likely to favour buying less meat, and plant-based, organic and fair trade products. 

Our research showed that the markets for meat-free and dairy-free, organic, and fair trade food and drinks are all growing.

Meat & Dairy Free

According to our YouGov survey, 15% of respondents followed vegetarian or vegan diets in 2020, compared to 13% in 2019. 

The market for meat-free and dairy-free products grew by 11% from 2018 to 2019, rising from £1bn to just over £1.1bn. In 2010, the meat- and dairy-free market was valued at £541m.

In the three months leading up to April 2020, when lockdown appeared imminent in the UK and non-essential travel was advised against, until the public were told to “stay at home” on 23 March, sales of meat- and dairy-free products skyrocketed. Meat-free sales increased by 25% over the three month period, and dairy-free products by 28%. 

Panic-buying and stockpiling may have contributed to this increase, though it’s worth noting that these figures far outstrip the 15% increase seen across grocery shopping in the UK generally during this period.

Increased spending on meat- and dairy-free products is a trend that looks set to continue. Our survey shows that 30% of people intend to eat less meat and dairy in future. 

Before the March 2020 lockdown, 20% of people regularly bought plant-based alternatives to meat and dairy (such as soya milk, tofu, plant-based burgers). Nearly 30% intend to buy more alternatives in future.

Image: organic veg box

Organic

The organic market has increased in value as well. In 2010 it was worth £1.5bn, which rose to £2.2bn in 2018, to £2.3bn in 2019. Organic sales jumped by 19% in the 12 weeks ending May 2020.

Local organic producers saw a spike in sales with consumers over-subscribing to veg box schemes. For example, Abel & Cole reported a 25% increase in its sales orders during the pandemic. Riverford Organics had to increase its capacity by 40%.

We were surprised to see that only 8% of people surveyed opted for organic produce before March 2020. Yet 19% of respondents plan to buy more organic products going forward. 

Fair Trade

The market for fair trade products was £1,094m in 2010. This grew to £1,603m in 2018 and £1,671m in 2019.

Fair trade sales increased 13.7% between October 2019 and October 2020 (ahead of total grocery sales which increased by 9.4% in this period). Growth of the fair trade market looks set to continue as 28% of people plan to purchase fair trade in the future, compared to just 15% pre-pandemic.

Ethical Home

The ethical home market saw the biggest growth in value: according to our 2020 ECMR report it grew by an incredible 45%. We valued the ethical home market at £15bn in 2019. 

There was a huge increase in spend (338%) on green electricity tariffs in 2019. In 2018 these were valued at £974m, whereas in 2019 this rocketed to £4.8bn. This largely owed to E.ON’s decision to move its 3.6 million electricity customers onto renewable tariffs. 

34% of survey respondents said that before lockdown they consciously made an effort to reduce energy consumption at home. Working from home during lockdown appears to have focused consumers on energy use, with 44% of people making an effort to reduce energy use during lockdown. 52% said they intended to reduce energy consumption more in future. 

The markets for energy efficient boilers, energy efficient light bulbs, ethical cleaning products, and sustainable timber and paper also saw small increases in value since 2018.

Ethical Travel & Transport

The onset of the pandemic unsurprisingly saw a spike in interest in cycling. Analysis from the cycling industry showed that 1.3 million consumers bought bikes in the UK during the pandemic. Around 45% of people are interested in cycling or walking wherever possible post-lockdown and multiple reports show a surge in demand for bicycles.

Public transport is the only ethical behaviour that looks set to decrease. Public transport usage crashed during lockdown, but people also appear to be cautious about using public transport after the pandemic. 16% of people plan to avoid travelling with others in the future.

Car Sales

In the year to September 2020 there was a 45% decline in petrol and diesel car sales. Sales of electric and hybrid cars were reported to have increased by 75% over the same period.

Overall, from 2018 to 2019 the ethical travel and transport market grew by 16% to £6.7bn.

Ethical Personal Products & Clothing

Three bars of soap in a wooden dish with flowers and herbs

It was a slower year for ethical personal products, with the market value up just 2.7% (to £1.7bn) in 2019.

There was quite strong growth in ethical clothing and cosmetics, both up 6% from the previous year. However, overall the ethical clothing market is still smaller than it was in 2010 (it was valued at £63m in 2010, in contrast to £53m in 2019). 

Second-hand clothes sales saw a decline of -1% compared to last year, which is remarkable considering that there was a 64% reduction in the number of people on the high street. The fact it didn’t fare worse could be attributed to the rise of second-hand clothing apps such as Depop and Vestiaire Collective which skyrocketed in popularity since lockdown, particularly amongst younger people. The Depop app, for example, had just under 1 million subscribers in March 2020 and over 2 million by May.

While 33% of survey respondents said they were buying more second-hand products during lockdown, 21% said they were buying less. 42% planned to buy more second-hand products after lockdown, whereas just 5% planned to buy fewer second-hand products in future.

Ethical Community

Ethical community spending reduced in 2019, showing a 2% decrease in overall value. 

People spent around £3.4bn in local shops during 2019, showing a decrease of 1.6% on the previous year.

Charity donations dropped by 2.6% in 2019. In terms of charity income generally, the Charity Retail Association (CRA) found that the average UK charity shop lost £33,150 in income between January and March 2021. However, our data shows that the overall market value of charity shops from 2018-19 (pre-pandemic) increased by 4.1%. 

While this overall negative growth in the community sector looks bleak, much of it is owed to the pandemic and the sector will hopefully recover when the high street becomes as populated as it was pre-pandemic. 

Our survey asked respondents which forms of ethical spending they planned to do more of in future. Shopping locally was the most popular answer. 46% of respondents said they intended to increase the amount they shopped locally post-pandemic, giving a promising indication to independent retailers outside of major towns and cities for 2021 and beyond. 

Our YouGov Survey found that 23% of those surveyed avoided companies associated with poor workers rights before the pandemic. 33% say they aim to avoid companies associated with worker exploitation in future. 

Ethical Finance

The ethical finance sector had its largest year of growth since 2010, with ethical investments accounting for much of this change. From 2018 to 2019 the finance sector grew by 13%. 

Ethical investment saw the biggest growth within the ethical finance market. It was valued at £18bn in 2018, rising to nearly £24bn in 2019. 

Ethical share issues remained the same from 2018 to 2019, while ethical banking and credit unions increased slightly. 

Before Covid, 18% of consumers tried to avoid companies with poor tax conduct. During the pandemic, 19% sought to avoid this, while 30% aim to avoid companies with poor tax conduct in the future.

Read more about ethical markets in the latest ECMR Report.

Find out more about ethical shopping

If you are thinking about your food, clothing, household and finance shopping habits and want to look at ethical options, start with our ethical shopping guide.

The shopping guide gives the low down on ethical shopping on a budget, how to shop ethically, articles on how to get started, and what the key issues are in ethical finance and ethical cleaning products, and what makes a company unethical.

Ethical shopping guide