Two key groups of consumers, dubbed the ‘eco-chics’ and the ‘eco-centrics’, are key segments in the eco-friendly market but they show extremely different behavioral patterns when it comes to handing over their cash, said market insight provider IRI (Information Resources Inc).
Eco-centrics are described as high-income, educated urbanites actively doing their part to protect and improve the environment. They have shown a willingness to change their buying behavior and a commitment to using environmentally-friendly products.
They read nutrition labels, are concerned with ingredients such as high fructose corn syrup and trans-fatty acids and avoid refined and processed foods, according to the IRI MedProfiler Health and Wellness Survey, which formed part of the study.
Eco-centrics also practice healthy habits, such as eating organic foods, whole grains, omega-3 and antioxidant rich foods, along with plenty of fruits and vegetables. They are also more likely to be on a vegetarian, gluten-free, high- fiber, low-fat, low-salt, or low-sugar diet.
However, eco-chic consumers, comprised of younger, more trend-influenced consumers, indulge in fast food more than the general population, are less likely to practice any kind of diet, read nutritional labels, or engage in healthy habits. Yet despite this, they generally feel they are doing enough to stay healthy, the survey found.
They also appear to be more interested in “riding the wave of environmental consciousness” by claiming to embrace environmental concerns, but not following through.
IRI President of Consumer and Shopper Insights, Robert Tomei, said the analysis showed the “undeniable importance of green positioning to manufacturers and retailers.
“While certain ‘green’ conscious consumers do make a concerted effort to buy ‘green’ products, there are certain segments of the population that are environmentally sensitive but that does not necessarily translate into their actual behavior”.
He added that the challenge that companies now face is to fully understand the nuances of green consumers and how to market to them effectively. This is particularly the case given the economic climate.
Recent information from The Federal Reserve indicates that economic activity remains weak, household and business spending has been subdued and labor markets continue to soften.
Tomei said: “It will be increasingly more challenging for many consumers to incorporate their sensitivity to the environment into their actual behavior, particularly for those ‘green’ products that may cost more to purchase.”
IRI analyzed numerous green product purchases across a variety of categories including food, which revealed the disparity in how well environmentally conscious consumers follow their convictions with purchases.
Eco-chic consumers did show a willingness to try some green products at a comparable rate to the eco-centrics, but unlike the eco-centrics, they ultimately returned to their favorite non-green brands.
For example, when asked to choose between taste and perceived quality, as opposed to environmental friendliness, they ultimately chose the former. This was demonstrated by lower than average purchasing of ‘eco-friendly’ food items such as cereal and milk.
In contrast the eco-centrics tend to follow through on their environmental beliefs with purchases of eco-friendly products and continued to purchase these products, illustrating their long-term environmental commitment. This was shown with food and beverage purchases such as cereal, yogurt, and milk.
In addition to its own survey, the IRI study was compiled by leveraging its partnership with the market researcher TNS, which has identified what it called “shades of green” in the market and identified eight distinct segments among US consumers.
One size doesn’t fit all
The growing importance of positioning products more carefully to suit different market segments rather than a one-size-fits-all approach was highlighted in a recent report form The Hartman Group, called The Many Faces of Organic 2008.
The report said manufacturers and retailers would have to develop specific understandings of the “organic categories that consumers find relevant and those that they find uninteresting and even frivolous”.
Shelley Balanko, of The Hartman Group, told FoodNavigator-USA.com at the time that it is no longer the case that if food manufacturers make a product organic, consumers will buy it for that reason alone.
Similarly the industry is seeing more market segmentation in the health and wellness category, according to Lee Linthicum, head of global food research, at Euromonitor International.
He said consumers are being more choosey about what they are buying and this is resulting in more condition specific products, such as weight management and satiety.
However, it does not mean products have been reformulated as they may be simply repackaged for a specific target audience, changing how they are positioned and leveraging advances made in food science in the last few year.