Breaking News on the Food and Drink Manufacturing Sector

Food eco labels more popular with shoppers and manufacturers

By David Burrows, 20-Jun-2012

Related topics: Packaging, Environment

They used to be a hard sell for a niche agenda, but eco labels exploded on to the mainstream and now consolidation is on its way.

Ethical labelling was once a hard sell. But consumers developed a conscience and firms got into corporate responsibility so their popularity grew. And grew.

Today the Ecolabel Index tracks 431 labels worldwide, while The Daily Telegraph has counted 80 in UK supermarkets. Little green frogs (Rainforest Alliance), blue ticks (Marine Stewardship Council) and even daisies (EU eco-label) can all be found stuck on a variety of products.

Perhaps the most recognisable remains Fairtrade. Sales of Fairtrade products reached £1.32bn in 2011 up 12% on the previous year.

But it hasn’t all been good news. The demise of organic food has been well documented, as has Tesco’s decision to ditch its "expensive" carbon footprint badge. Meanwhile, surveys suggest ethics is less of a priority, as the recession bites consumers.

Is this the end for the ethical label? Surely not for the likes of Fairtrade (especially now Cadbury and Mars are on board). Perhaps not even for organic or carbon reduction labels, which are sold on products worth £1.67bn and £3.3bn respectively. And yet more labels are appearing.

Last legs

But changes are afoot – ones that could see fewer labels in the next 20 years. "It's a long way off and labels are by no means on their last legs, but there is something going on," says Rob Cameron, executive director of think tank SustainAbility and former chief executive of Fairtrade International.

For one, there is a desire to reduce confusion. France is trialling a label that shows carbon footprint and up to two other green indicators. The general trend will be consolidation, says Martin Barrow, a principal for the Carbon Trust Advisory.

Second, brands are looking to broaden their sustainability goals. Marks & Spencer (M&S) claims to have "done the heavy lifting" when it comes to sustainable selection so its customers don’t have to. Gepa, a German firm that makes coffee, tea and confectionery is supporting the idea of Fairtrade financially, but moving away from the label because it has become too mainstream.

Unilever

Unilever, meanwhile, is set to launch its first corporate brand campaign to complement its Sustainable Living Plan. The firm’s chief marketing officer said he wants the brand to be a quality mark for sustainability.

Head of sustainability at the British Retail Consortium (BRC) Catherine Pazderka says certification has provided consumers with assurance, but there is a "huge auditing business that has evolved with that and food manufacturers would probably agree that it has become a bit much". Going forward, she says, the question firms will be asking is: how can we improve the supply chains to benefit everyone?

Others suggest the certification schemes could pool their resources better. "Too much energy is wasted in drawing attention to small differences between the underlying sustainability aspects of the schemes, which damages overall consumer confidence in labelling full stop," explains Mark Line, executive chairman at consultancy Two Tomorrows.

Consumer engagement "isn't necessarily as high as firms would have hoped", says Pazderka. "Fairtrade has taken 25 years to get to where it is, but people still don't understand the processes behind [the label]. I think the majority of people want to trust in the retail brands [to source sustainably]," she adds.

But do they? Those involved in certification schemes would suggest not. The likes of Unilever, Gepa and M&S would argue otherwise. If more follow, what happens to eco-labels? They fade into the background at least according to a report by SustainAbility, which claims they can’t deliver sufficient value.

In theory, a body such as Fairtrade should be trying to put itself out of business. But perhaps not yet, says Cameron. "The day when brands are trusted and we don't need a label front of pack is a long way off."