Targeting the sustainable consumer in Latin America8 Oct 2021
Latin Americans are among the most concerned about climate change and the most interested in sustainable actions but they are also highly price sensitive, according to Euromonitor. How can brands strike the right balance?
Latin American consumers are the most concerned about climate change and express the greatest interest in generating positive change in the environment, according to a 2021 Euromonitor Lifestyles survey that questioned individuals from around the world.
Additionally, there are currently 80 policies in the Latin American region that ban single-use plastics or promote a circular economy, according to a recent report by London-based Latin American think tank Chatham House. These include a packaging law in Uruguay, a zero-waste initiative in Panama, a decarbonisation programme in Costa Rica, and the Clean Production Agreement in Chile.
Saving money and the planet
However, consumers in the region are also highly price sensitive and this can be a barrier to uptake for products that are produced sustainably and thus carry a price premium. The COVID-19 pandemic, with national lockdowns and mandatory curfews that prevented millions of people from working, has further reduced the disposable income for many Latinos.
In March last year, the UN Economic Commission for Latin America and the Caribbean (ECLAC) forecast the economic contraction following COVID-19 would result in a 10% rise in unemployment, increasing the number of people classified as poor in the region from 185 million to 220 million.
“Price continues to be one of the biggest challenges to sustainable production in the region,” note Euromonitor analysts Jorge Araya and Jorge Zuniga. “Products that have a sustainable attribute (often the result of a redesign in the production process or the packaging, or external certifications such as carbon neutrality or organic production) carry an additional charge that is normally passed on to the consumer. This immediately limits or restricts sustainable products from achieving mass consumption in a region full of very price-sensitive consumers.”
Nevertheless, Araya and Zuniga see opportunities for brands to link environmentally-focussed initiatives with saving money. They point to Chilean start-up Algramo’s business model as an example. Algramo works with big brands, such as Unilever and Nestlé, to sell their branded produce in durable, reusable containers and says its target consumer base is as much people who care about the environment as it is those who want to save money.
Clear communication for plant-based products
The plant-based category also has good potential to find its place in the Latin American market as long as brands provide more transparent information on ingredients and sustainability, according to Graciana Méndez, senior regional consumer insights analyst at Mintel. Its data shows that nearly seven out of 10 Colombians agree that plant-based foods are better for the environment, for instance.
“Plant-based started as a food trend, rooted in younger consumers who were using their eating habits to promote social and environmental justice,” Méndez writes in a recent Mintel blogpost. “Lately, however, consumers are becoming more interested in plant-based formulations for a number of reasons, including health benefits and improved animal welfare. The pandemic has played a part, with people viewing plant-based as healthier and safer than meat due to COVID-19’s suspected zoonotic origin.
“But there is still work to be done on educating people about the wider environmental benefits. While there is already an understanding that plant-based foods are better for the planet, helping consumers properly understand the link between plant-based foods and environmental gains such as reducing carbon emissions and water use, will encourage more people to limit their meat intake.”
Méndez references Mexican brand Asante, which claims that eating one vegetable protein-based product contributes to water savings equal to 19 showers and saves 14m² of forest.
Brands could also leverage traditional and native ingredients to appeal to consumers.
In Chile, for instance, the algae cochayuyo (Durvillaea antárctica) is a traditional food that has a reputation for being healthy and cheap, and is found both in markets and supermarkets in its whole, dried form. However, a number of emerging plant-based players are incorporating this ingredient into their finished products. Quelp uses 50% cochayuyo in its vegan burgers and meatballs; Munani makes oven-baked cochayuyo chips; and Nün sells pasta made from a blend of seaweed and high-protein ingredients such as lentils, chickpeas and quinoa.
Méndez concludes: “As it has in other parts of the world, plant-based has emerged as a buzzword in Latin America. However, for it to become a more meaningful term, brands will need to communicate how it can be good for people, animals and planet.
NutriScore algorithm update a ‘step in right direction’
7 Sep 2022
Campaigning organisation Foodwatch International is hailing the update to the NutriScore algorithm as a “step in the right direction” but says there is still space for further improvement.Read more
Are new WHO sweeteners guidelines ‘a disservice’ to public health?
6 Sep 2022
New draft recommendations from the World Health Organization (WHO) warn that zero-calorie sweeteners should not be used to help weight control or reduce the risk of noncommunicable diseases’ (NCDs) – sparking mixed reactions from industry groups.Read more
How the Ukraine crisis may affect the food chain transition
2 Sep 2022
From supply issues to price surges, the impacts of the Russo-Ukrainian war on the global food value chain are significant. What pain points has this crisis exposed, and what should the response be?Read more
Canadian authorities report titanium dioxide is safe in food, in the face of EU ban
1 Sep 2022
Health Canada joins the UK’s Food Standards Agency in concluding that titanium dioxide is ‘safe to consume’, putting it squarely at odds with recent safety assessments in Europe that led to a ban of the ingredient.Read more
Most food businesses are placing inflationary costs on consumers, survey finds
31 Aug 2022
Consumers are being hit with product price increases as manufacturers pass on higher costs to the public. But with some major food manufacturers registering profits, is a public backlash on the cards?Read more
Hyperlocalisation promotes food system resilience and diversification
30 Aug 2022
Climate change action and new technologies are driving a rise in hyperlocalisation throughout the global food chain, improving the industry’s adaptability and ability to meet consumer demands for greater choice.Read more
Tackling the rise of antimicrobial resistance
29 Aug 2022
As the 2030 goal of halving antimicrobial use edges closer and a 2022 regulation is brought in to reduce antibiotic use on farm animals, the food industry is loudening its calls for action amid the increasing resistance to antimicrobials.Read more
WWF report slams Europe’s damning effect on the global food system
26 Aug 2022
Europe may not be helping, but in fact hindering the global food system by inciting gross environmental, societal, and fiscal harm, a recent WWF report shows. Consumers however are hungry for change.Read more
Researchers develop automation method to isolate volatile food ingredients
25 Aug 2022
A research team in Germany has applied automation to a long-standing method to isolate volatile food compounds, creating advantages over the existing manual process, which include food manufacturers’ potential to increase yields and lower the contamina...Read more
New partnership strives to improve cocoa farming in Ivory Coast
24 Aug 2022
Conseil du Cafe-Cacao and IDH’s Sustainable Trade Initiative launch a new programme, Cocoaperation, to support cocoa farming and improve the livelihoods of cocoa producers.Read more