A record-breaking 182,000 consumer packaged goods were introduced in 2006--17% more than the previous year, according to a report issued yesterday by Mintel International.
There's been a significant increase in products with better-for-you positioning, but the trend also is driven by new products that take an ethical stance--such as those claiming links to fair-trade, sustainability, ecological friendliness and charitable causes. Such products doubled last year and appeared in an ever more diverse array of categories--from food to paper products to fuel.
Packaged Facts, the publishing division of MarketResearch.com, calls the trend "conscientious consumerism." It also released a report this week, claiming that grocery sales of products making ethical claims grew to nearly $33 billion in 2006, up 17% from 2005.
This is not your father's old green marketing campaign, which promoted recyclable packaging and ozone-friendliness. Today, claims of "organic" and "sustainable" and "biodegradable" are just the tip of the trend. Current eco-friendly products make claims such as "No GMOs (genetically modified ingredients); hormone-free; no animal clones; no animal testing; fair trade; locally grown; and cage-free, to name a few.
Retailers and consumer product companies are working at the same pace to meet consumers' demand for eco-friendly products. For example, Whole Foods has banned live lobsters, and D'Agostino Supermarkets in New York City offers "certified humane" meat and dairy products.
"More majority corporations are becoming visibly involved," said Susan Porjes, a Packaged Facts analyst. "Wal-Mart is repositioning itself on an ethical platform--not just through organic foods, but energy-saving technologies.
Colgate recently majority-bought Tom's of Maine. L'Oreal acquired The Body Shop. Kellogg introduced organic versions of some of its best-selling cereals like Rice Krispies. Kraft launched a 30% Rainforest Alliance-certified blend of Yuban coffee. Likewise, Costco and Sam's Club have launched private-label Fair Trade coffees."
Packaged Facts predicts the trend will continue to grow by double digits to more than $57 billion by 2011.
"The eco movement is not a fad," says Lynn Dornblaser, a Mintel analyst in Chicago. Significant world events--like Hurricane Katrina, the tsunamis in Southeast Asia and the Iraq War--have nudged the consumer into consciousness. "People are aware that there is a lot more out there than just us," she added.
Natural and organic product labeling are leading the parade of ethical claims on new products, according to Datamonitor's Productscan Online. For the first 11 months of 2006, 2,703 new grocery products claimed to be "natural," up from 1,827 for the full year 2001. Nearly 1,100 new products were "organic," more than double in the same period.
"We've definitely seen an increase in new products that make the fair trade claim," added Tom Vierhile, director of Datamonitor's Productscan.
The interest in doing good comes none too soon, given that worldwide household consumption is at an all-time high--to $19.5 trillion in 2000 from 4.5 trillion in 1960, according to the United Nations Environmental Programme. The eco-friendly movement is what Packaged Facts calls America's "shift from ego to eco."
"Increased awareness of sweeping ecological, social and health issues is driving fundamental changes in the collective consciousness as Americans' values shift from ego to eco," the report states.