Consumption mode: Consumers are moving towards an era of conscious consumption and will reward companies that act responsibly on sustainability issues.
Consumption mode: What does Sustainability mean?
Sustainability in the 21st century refers to the ability of the “biosphere and human civilization” to coexist. Thus, it is also defined as the process by which people maintain change, in a balanced environment. Furthermore, it concerns the exploitation of resources, the direction of investment, the orientation of technological development and institutional change. All this points, need to be in harmony and enhance the present and future potential to meet human needs and aspirations.
According to the Global Corporate Sustainability report shared by Nielsen: “66% of consumers say they are willing to pay more for sustainable and transparent brands”. In consequence, the food industry has been particularly affected by a growing consumer interest in stricter ethical standards, such as fair trade. As a result, consumers ask for better declaration of the products composition (gluten-free, colour-free, etc.). Thus, the vitamin and supplement industries were also affected, following several investigations targeting some US retailers selling herbal supplements. In fact, compositions had not been properly reported.
Consumption mode/ Sustainability: A matter of trust
Consumer do not trust renowned brands. This is particularly true among Millennials (the name given to all people born between 1980 and 2000), which clearly indicate a preference for brands that are in line with their values.
In the cosmetics market, the need for traceability is not only influenced by food trends. Thus, it also corresponds to the shift towards naturalness, which has transformed the industry over the last decade. Defining “natural” in cosmetics has always been a difficult task. From the 70s, when consumers had a growing appetite for “greener” products, until today, consumers have been juggling between:
- potential health risks of ingredients
- environmental concerns
- societal impact.
Beauty product users are using an increasing amount of information to decipher product labelling and certifications. But to be able to rely on the information listed by brands on their packagings, they need confidence. For brands, it’s all about transparency and clear communication, from the origin to processing of the ingredients, from the (agricultural) farm to their formulation.
The formulation of a cosmetic product is a complex process involving many stakeholders.
In this respect, the use of natural ingredients only increases this complexity. In fact, the natural ingredients come from plants, mainly cultivated or harvested in the wild. Farmers generally sell their harvests directly to cooperatives or brokers, who consolidate them from different farms. Thus, some suppliers may add additional steps to improve formulation performance (dilution, purification, blending, etc.) before they can finally sell them to a cosmetics manufacturer. Therefore, very often, the formulation is outsourced to a third party manufacturer, before the product is labelled under a brand name and finally reaches the stores. In this context, major brands, like independent brands, face different challenges. Famous and large brands impose enormous volumes of ingredients, which imply multiple origins, blurring traceability. Smaller and more flexible brands can easily identify the specific origin of their ingredients. However, they generally have less in-house manufacturing capacity and rely on more external players.
Because traceability has been a major challenge for the food industry since many years, solutions have been created to help brands and manufacturers in order to track the origin of their products. The cosmetics industry has, however, been slower to adopt these tools. Many brands rely on certifications to communicate on their environmental and societal impacts. However, most of these certifications do not track raw materials and do not have traceability systems to follow an ingredient throughout its life cycle and guarantee the certain origin of a natural ingredient.
We should be responsible from the earliest stages of product development, starting with the selection of Raw Materials (RMs). Using an application can help you learn more about these ingredients