Economy Begins To Trump Environment
Cost is the major reason that people avoid green products, with 54% of respondents saying they would buy more green products if they were cheaper. And those statistics are consistent with earlier studies-- including Mintel's October report, which found that 78% of U.S. consumers say they would buy more organic food if it were cheaper--and a January study that found that 52% of shoppers believe green cleaning products.
"People's priorities have changed because of economic hardship," Mintel says in its analysis. "A substantial number of shoppers are now struggling just to provide the basics for their families, so green living is no longer top of mind for many Americans."
An increasing number of consumers were loyal greens throughout 2008, despite the economy's growing upheavals. Nielsen says that "natural" food generated $22.3 billion in sales in 2008--up 10% from 2007, and up 37% from 2004. And consumers spent $4.9 billion on organic foods--up 16% from the year before, and up 132% since 2004. Still, there was a sharp pullback in food spending in the second half of the year, with the fourth-quarter falloff in food spending the largest on record since the U.S. Commerce Department began tracking food spending back in 1947, reports the Food Institute.
And certainly, marketers that can offer consumers green purchases that also save money have an advantage. A spokesperson for Goodwill Industries, for example, says its same-store sales are up 6.7% in 2008, and while much of that is from consumers buying secondhand clothes to save money, "we've definitely heard from the green consumer, often fashion mavens, who are happy that they can buy recycled clothing and help the environment," she says.
Mintel still forecasts green growth, and expects that while the recession will affect sales through this year, there will be a 19% growth for green products overall through 2013 with personal care and household cleaners expected to do well, while organic foods--a more mature segment--will grow at a slower pace.