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European buyers demand product data transparency, forcing brands and retailers to adopt new strategies

Changing consumer behaviour is creating new challenges for manufacturers and retailers. A large proportion of today's consumers prefer a more sustainable and healthier lifestyle. Shopping habits for consumer goods, be it food or cosmetics, clothing and electronics, are strongly influenced by these expectations: the demand for locally produced goods, nutritionally healthier products (with a 5-Colour Nutrition label/Nutri-Score of A, B or C) and more environmentally friendly products (instead of disposable items) is increasing. Companies that meet that demand are rewarded. For example, IRi’s market research found an increase in annual sales of around 5% for Nutri-Score A products after the nutrient-labelling system was adopted.
 

Buying with a Conscious

The consumer figures of the European Commission published in the Consumer Conditions Survey 2021 substantiate these developments in purchasing behaviour in Europe:

  • 67 % of European consumers prefer to buy more environmentally friendly products, even if they cost more.
  • 59% of UK consumers pay attention to the environmental impact before purchasing a product.
  • 81% of European consumers prefer to shop close to home to support local businesses.
  • 59% of over 20,000 Europeans surveyed for EIT Food Trust Report 2021 reach for healthy food and 51% reach for sustainable food when given the choice.


Manufacturers and retailers respond

To address changing consumer behaviour, retailers and brands have already launched several initiatives, first by presenting and making accessible a range of accurate and transparent data on a product's materials, origin and ingredients. Electrical appliances provide information about their energy efficiency and follow the better labelling requirements to comply with the "right to repair," which stipulates that goods must be more durable, long-lasting and repairable.

It’s all about the right product information

Providing customers with the product information they want, clearly and at the point of purchase, is becoming a crucial competitive factor for retailers and brands. When consumers choose between two retailers or two products, they will choose the one that offers the most comprehensive information. According to Salsify’s Consumer Research 2022, 41% of shoppers in the UK rank the quality of product details as a top-3 reason when choosing where to shop, and 46% of the surveyed British consumers abandon their online cart if they don’t find the product information they look for.  


Consumers trust transparent retailers and brands

Today's informed and digitally connected consumers want as much information as possible about the products they buy. Information on the energy content and the nutritional values of fat, saturated fatty acids, carbohydrates, sugar, protein and salt have had to be included on food packaging for a long time - and uniformly throughout the EU. As the Food Standards Agency’s (FSA) ‘Food and You 2’ survey shows, trust in food safety, authenticity, and the food supply chain remained high even during the COVID-19 pandemic. According to research from IRi and Nielsen, sales of A and B rated foods increased while sales of C and D rated products decreased in the past years. Younger consumers are more likely to take the Nutri-Score into account when deciding what to buy.

Since Covid hit, the Farmer Favourability Survey showed that 75% of the surveyed Brits supported local food and farming. The National Food Strategy aligned with this trend and engaged in rethinking Great Britain’s food systems, supporting more sustainable farming practices. Increasingly mindful of their environmental footprint, consumers have internalised that consuming local products leads to a reduction in CO2 emissions. 

The large retail chains are responding to the trend across Europe. In the UK, supermarket chains such as Booths (80% of the meat sold in their stores comes from the region) and Morrisons (listing 1,300 products from local manufacturers) launched initiatives several years ago to promote long-term partnerships with local farmers and producers, defining common values and principles. This engagement is now coming into focus across all sales channels and marketing, both in-store and online.

Sustainability labels are being tested

More British consumers are adopting a sustainable lifestyle and prefer products that protect the planet. The EU Commission wants to develop uniform specifications for a sustainability label for food. However, there is disagreement about the Eco-Score, pioneered and later postponed by the regulator from 2021 to the end of 2022. In the meantime, the organic association BNN has introduced its own label, the "Planet Score".  

Lidl UK claims to be the first retailer in the country testing the Eco-Score in its stores in Scotland. “We want to make labelling clearer so that our customers feel confident to make more sustainable decisions when shopping with us.” 

Which label will ultimately become binding throughout the EU is still open. The hundreds of green labels can be confusing to shoppers but reflect one good news: the food market is evolving in terms of sustainability labelling and reacting to the new consumption model.
 

How collaborative platforms enable transparency

To meet the consumer demand for comprehensive information, retailers and brands are looking for technological solutions that help provide clear information and increase transparency. These include databases and collaborative projects, such as mobile apps that allow consumers to directly access product information or nutritional and environmental scores. 

Collaborative platforms for commerce experience management facilitate data sharing between manufacturers, retailers and consumers by enabling real-time updates, reliability checks and product data updates, to ultimately turn consumer demands into opportunities for brands and retailers.

To find out more about Salsify and the services they provide to the retail industry, click here.

This article was also published in The Retailer, our quarterly online magazine providing thought-leading insights from BRC experts and Associate Members.