Market Insight from
Pandemic advances sustainability focus for US consumers
According to GlobalData, the coronavirus pandemic has resulted in consumers in the US placing increasing importance on sustainability when it comes to purchasing habits – and brand owners would do well to pay attention.
Late last year, Nestlé announced the $50m expansion of its Eau Claire facility in the US to improve the sustainability of the site, which produces nutritional drinks. As part of the investment, all plastic straws will be eliminated from Eau Claire's beverages stable, including the Boost energy drinks brand. The facility also aims to be powered by 100% renewable electricity by 2025.
The coronavirus pandemic had a major impact on consumers' beverage habits last year across all categories, as at-home consumption increased due to lockdown measures. Brand owners were subsequently compelled to alter their marketing strategies to reflect this change.
While cost remains the main factor influencing purchasing decisions of beverages – as shown in the US, where premium soft drinks sales are estimated to have fallen by 12% in 2020 – sustainability of packaging and production has become increasingly important for consumers, thanks to Covid-19.
According to GlobalData, around 35% of US consumers find recyclable and reusable packaging is more of an important priority to them as a result of the pandemic. Sustainable production methods also grew in relevance, with 27% of consumers considering this more important than they did before Covid-19 broke.
A shift to focusing on sustainable packaging has followed, with many soft drinks companies in the US getting on-board. Nestlé's US division announced new sustainability projects towards the end of last year, from ingredients to packaging and production, while alkaline water brand Perfect Hydration transitioned from recycled polyethylene terephthalate (rPET) bottles to aluminium cans.
In 2021, offering consumers information about a brand's sustainability initiatives will be vital to improving its image. Companies already engaging in sustainability initiatives are highlighting their efforts on Social Media or through their brands' labels.
GlobalData notes that 29% of US consumers would like to hear more about how brands are being sustainable during the pandemic, highlighting the importance of making consumers aware of all sustainability initiatives.
Consumers' currently high levels of interest in sustainability can be attributed to increased concerns about hygiene and safety, as well as to ensuring a sustainable future in the aftermath of Covid-19.
To help them survive in 2021, brand owners would do well to start the year with a review of their production and packaging methods, thereby increasing their appeal to consumers.