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Water-conscious consumers, upcycled food, and tech-driven sustainability: Highlights from Fi Europe, part 2

With climate change becoming a tangible reality, consumers’ environmental concerns are changing. At Fi Europe, market analysts revealed how people are now interested in everyday issues like water shortages and tech-driven solutions such as GM drought-resistant crops.

Consumers are becoming much more “resource conscious”, according to Richard Cope, trends consultant at market research company Mintel.

Climate change has always been the top environmental priority, according to Mintel research, followed by air quality because of the health implications. However, in the past 12 months, water shortages have overtaken ocean plastic and waste as the number three concern.

“I think that is very telling,” Cope told Ingredients Network, “particularly in southern Europe we see water shortages becoming the number one environmental concern for the French, Spanish, Italians, as well as Mexicans and Brazilians.”

He added: "… what that tells me is, sustainability has gone from being a 'nice-to-have' to now an issue that impacts people's health, impacts their ability to afford certain foods, and people [are] being hit directly by shortages within the supply chain. It's less about emotive issues such as ocean plastic. People are now prioritising things that they can see happening outside their window, things that are impacting their health and spending power."

The tech innovation priority level

Mintel has also conducted consumer surveys to assess attitudes towards tech-driven innovations that have the potential to lessen the impact of food production on the environment such as lab-grown meat, upcycled ingredients, or genetically modified crops.

"Consumers are accepting of those but basically there is a sort of priority level,” Cope said. “They are much more accepting of upcycled food and ingredients than they are of things like lab-grown foods or GM [genetically modified] ingredients. But a strong minority, which could be upward of 40% of people, do think GM ingredients that are more resistant to drought are something that we should be looking at, and similar proportions are open to lab-grown meat as well."

Nurturing nature: Are consumers willing to pay a premium?

Like Mintel, Netherland-based Innova Market Insights has found that concerns over water use are on the rise. Over the past four years, there has been a 40% annual increase in food and drink products making some sort of water usage claim, globally.

Innova recently published its top 10 trends for 2024 and placed ‘Nurturing Nature’ in second position. It says that a compelling sustainability story can be the tiebreaker between a consumer buying one product over another.

But how does this fit with the current cost-of-living crisis? Are people who are feeling the pinch also willing to pay a premium for sustainable products?

"I think this question – are consumers willing to pay the extra? – does not fit so well anymore,” said Nicole Jansen, analyst and customer success team lead at Innova. “The issue is that we need to make sure we do good for our planet. […] It's [increasingly] top of the consumer's mind and there are many brands out there that have solutions.

“So, in the end, if you have the option between a product and it has the same functionality and serves the need that you're looking for and it has a sustainability claim - and one that doesn't - the consumer will simply choose the product that has it.”

New opportunities for affordable sustainability

Cope from Mintel, meanwhile, argued that the cost-of-living crisis would create new opportunities for products that are both environmentally responsible and affordable.

"You are seeing people place a little bit more emphasis on quality, brand familiarity, and things like that,” he said. “I would actually argue that the cost-of-living crisis is opening up an opportunity for more responsible, more sustainable products because people are going to be looking for things that can be sustainably sourced, that can be more efficient, and are affordable in the long-term. So, it is going to generate a need for those more affordable, sustainable products."

Upcycled innovation in the US

US retail data company SPINS identifies the "innovation ratio" in various food and drink categories. This relates to the percentage of products in a given category that have been launched in the past year. More than 12% of US snack products are new launches – a much higher index than other food and drink categories. Specifically, it notes that sustainable claims on snack products are trending, according to SPINS data: products with an upcycled ingredient certification have risen 193% year-over-year in sales.

Brandon Casteel, vice president of partnerships at SPINS, said: “What we're clearly seeing from manufacturers and consumer feedback loops is: 'This is where I want innovation'. And so, manufacturers are responding to these new desires and new formulations."

“You've got consumers clearly saying: 'Sustainability matters, I'm willing to pay for these products, they align with my values in the snacking sector’."