Date published: 24.02.2021
How to (re)gain consumer confidence
The Covid-19 crisis marked a turning point in the relationship between consumers and FMCG brands. More than ever, consumers want brands to be responsible, committed and transparent about their practices. In this article, discover new consumer expectations and how brands are taking up the challenge.
New expectations & priorities in 2021
The global health crisis has changed consumer habits. It has also had an impact on expectations and priorities. According to the PwC Global Consumer Insights study, following the Covid-19 pandemic, more than half of urban consumers (51%) say they are more focused on their physical and mental health, wellbeing and diet. There is also a clear embrace of sustainability and a growing sense of civic duty, which have become critical issues for many consumers. Oz Ozturk, Global Consumer Markets Advisory Leader, PwC UK says:
“In our 11 years of surveying consumers around the globe, we have never documented such a clear convergence of themes around transparency, sustainability, and social consciousness. At such a pivotal moment, the need for consumer-facing companies to establish trust with potential customers could not be any clearer.“
A key requirement: label transparency
If there is one topic on which consumers want total transparency from FMCG brands, it is labels and ingredients. For brands, this means showing that they have nothing to hide.
SC Johnson for example communicates on having “no secrets” and being 100% transparent on fragrance ingredients. It even launched a website called What is Inside which allows to search its products and learn about the ingredients.
Unilever has a similar initiative, with a section of its website called “What’s in our products” which presents its approach to ingredients and enables to look up specific products. The company explains why certain ingredients are used and the role they play.
But transparency is not only about what type of ingredients are used, it’s also about where ingredients come from. Blédina publishes chronicles on YouTube which aim to show the behind the scenes and reassure parents. Videos provide virtual tours of Blédina orchards and factories and include QAs with farmers and nutritionists. The videos also feature real customers asking tough questions, which the brand then responds to.
More and more British consumers are also choosing to buy products made from local ingredients. As such, an increasing number of brands are communicating on the fact that they use “British milk” or “British eggs” for example in their recipes.
An increasingly important criteria: social and environmental practices
While labels and ingredients are a crucial issue, British consumers are also becoming more socially and environmentally conscious, scrutinizing how brands behave. According to Deloitte, 43% of consumers are actively choosing brands due to their environmental values and 34% are choosing brands based on their ethical credentials.
Mondelez has been taking charge of these issues through its Harmony Wheat scheme, which aims to sustainably source the wheat used in its products and help farmers improve the methods they use for growing their crops. Its objective is to make its entire biscuit portfolio across Europe with Harmony sustainable wheat by 2022.
Responsible sourcing is also a key topic for Ferrero, which has created a Hazelnut Charter outlining its commitments and requirements based on selected priorities in three areas: human rights and social practices, environmental protection and sustainability, and supplier transparency. To achieve its objectives, Ferrero is partnering with Earthworm Foundation, a non-profit organisation focused on positively improving value chains.
Consumers are also demanding more sustainable packaging. Brands are responding with new offerings. Nestlé for example recently launched three new Smartie bars with eco-friendly packaging. Instead of plastic, the bars are now wrapped in a recyclable paper sleeve. Louise Barrett, Head of the Nestlé R&D Centre for Confectionary in York, explains:
“Making changes was not just switching plastic for paper. We took a holistic approach during the development process. Thanks to the new design we were also able to reduce the packaging material versus the plastic version.”
A new aspiration: brands doing good
While consumers expect transparency and responsible practices from FMCG brands, they also want them to be useful to society and do good. This has become even more important with the Covid-19 outbreak.
According to the Havas UK Covid-19 Consumer Report, consumers now have higher expectations on three dimensions: a brand’s collective benefits (the role that they play in society), its functional benefits (how a product delivers) and its personal benefits (how the brand improves people’s lives). 66% of respondents said that the collective benefits of brands are more important to them now than they were prior to the pandemic.
Eva Grimmett, Chief Strategy Officer, Havas Media Group, says:
“Our research also shows a significant gap between expectation and reality for older consumers, particularly when it comes to the role brands play in society. Savvy advertisers should address this deficit and find ways to make a more positive contribution in order to engage with this group.”
Some brands are responding by becoming B Corp certified. B Corp brands in the UK include innocent, Pukka Herbs and Cheeky Panda, as well as Danone’s UK Essential Dairy & Plant-based business (EDP), whose brands include Activia and Actimel and which was the first UK dairy company to get certified, becoming a B Corp in 2017. Ocado recently announced that it was launching a dedicated aisle for B Corp brands, with a selection of 1,100 products from 35 brands.
Other brands are choosing to support good causes. Heinz for example announced in September 2020 a five-year partnership with the charity Magic Breakfast, which provides healthy school breakfasts to children at risk of hunger in disadvantaged areas of the UK. Heinz will offer 12 million free breakfasts as part of its support.
The question of affordability
While many consumers are adopting environmentally sustainable and ethical brands, affordability remains an important barrier. And, with the sanitary crisis, many households have experienced a loss of income. The recent Ipsos report “Clean, Green and Affordable” highlights that, in a Covid-19 world, companies that can balance sustainability, hygiene and value will build long-term reputational equity and greater chance of success.
As a conclusion, in 2021, British consumers want brands to be transparent and responsible, with sustainable practices. They also expect them to do good and be useful to society. To gain or regain consumer confidence, brands need to live up to these expectations. It is also important that they have a balanced approach to marketing, avoiding greenwashing for example. Authenticity is essential and the pillar of a relationship of trust between FMCG brands and consumers.