CPG Trends 02 August 2022
Our July Roundup: sustainability investments, carbon labels, low-tech entertainment and the future of eating fat
In this roundup we explore the latest in sustainability investing from PepsiCo, a change in mission from P&G, carbon labels to aid consumer choices as well as the trend towards nostalgia and low-tech entertainment.
5 minute read
Here’s what caught our eye this July in CPG news from across the industry.
DTC brand Glossier has changed its approach, moving to a full omnichannel strategy. The brand reached cult status early on, appealing to millennials with its pink colour scheme and no-makeup look. However, over time, the brand has lost ground with younger consumers, resisting the ‘clean beauty’ trend and shunning retail.
By expanding into Sephora, Glossy hopes to turn the tide, giving more consumers access to the brand. As online marketing costs continue to rise, Glossier also hopes to continue opening its own stores, holding on to its DTC approach while fostering ‘human connection’ through physical experiences with the brand.
In short: Digital-first company Glossier began losing ground; major restructuring and a partnership with Sephora aims to turn this around.
P&G Chief Brand Officer Marc Pritchard: Profit drives good, not vice versa – and sustainability cannot be our main message
In a reversal of its previous mission, P&G now promises to be ‘a force for growth to be a force for good’ rather than the other way around. Brand chief Marc Pritchard has declared growth a means to fund good, and advocates against being distracted by taking a stance on social issues. He has said:
“Our job is we need to help people understand that growth leads to good. Economic growth is good, it helps communities, it helps society – then it also gives you as a company the means to do more good for society and for the planet.”
Sevendots Partner Colin McAllister says of this news:
“What P&G is reaffirming makes perfect sense: growth needs to be balanced between economic, social and environmental impacts. I doubt whether the likes of P&G or Unilever ever lost sight of this but clearly they’ve felt the need to reaffirm to the business community that focusing on Sustainability or Purpose alone, at the expense of short term financial performance and sustained product innovation, will never work out”Colin McAllister
In short: Growth is the force for good in P&G’s latest mission statement. Chief Brand Officer Marc Pritchard says sustainability will not be the main message for consumers, and brands must stay focused on growth in order to aid society.
From Food Business News
In the other spectrum of business news, PepsiCo has closed on a $1.25B 10-year green bond, proceeds of which will be used to deliver environmental initiatives. The company has allocated proceeds towards sustainable plastics and packaging, decarbonizing operations and supply chain as well as water sustainability. Chief sustainability offer James P. Andrew has said:
“While tackling the climate crisis requires a collaborative effort, it is clear that the private sector must play a leadership role. Our new green bond will be pivotal to channelling investment into the critical areas required to build a more sustainable and resilient food system.”
Other uses for the funds include towards regenerative agriculture, including farmer training, reduction of fertilizer use and watershed enhancement and improvement projects. Sustainability is still key to growth for PepsiCo, rather than the other way around.
In short: Sustainability comes first at PepsiCo. Their latest green bond will be used to deliver initiatives under 2 pillars of its pep+ agenda: Positive Agriculture and Positive Value Chain.
From the Financial Times
With the food we eat responsible for a third of global greenhouse emissions, consumers are more attentive than ever to the way their diet impacts the planet. A 2020 survey showed that the majority of consumers support carbon labels on food items. Denmark is on track to be one of the first countries to implement this, but the process remains complex when it comes to accurately understanding the impact of food.
In this piece, the FT provides a handy scale that uses data from CarbonCloud, a climate change research company working to calculate the impacts of food. The piece also details different parts of your shop – including meat, fish, dairy and alternatives – to compare and contrast where carbon savings can be made. This is a page to bookmark for future use!
In short: Consumers support carbon labelling, as our ‘gut feeling’ on emissions is nowhere near accurate. In this piece, you’ll find an interesting breakdown of items across the supermarket shop, as well as a handy scale to better understand the impact of food items.
From Food Matters Live
The avocado has become a symbol of unsustainable food choices in the Western world, and so it was only a matter of time before something like the Ecovado was developed! Developed by Arina Shokouhi, a recent graduate in Material Futures, the product ‘is an alternative to avocado that employs design thinking to help consumers reduce the amount of avocado they eat’. Shokouhi also says:
“It was designed by identifying the chemical elements of avocados and the functionality of each molecule to try to find equivalents from more local and low-impact sources that do not rely on threatened crops.”
In short: Recent Material Futures graduate Arina Shokouhi has developed the Ecovado, an environmentally conscious alternative to the avocado that uses all British ingredients for a more local and sustainable product.
From Insider Intelligence
Nostalgia is officially in. Consumers are turning to low-tech entertainment from the past, making the old new again. Vinyl records exceeded $1B in sales last year, disposable camera sales are growing, and Lego is set to release an Atari 2600 set that debuted in 1980. Gen Z are into nostalgia for sure, making this a trend worth watching out for. What other low tech trends have you seen resonate with consumers?
In short: Nostalgia is on trend, as Gen Z consumers turn to low-tech and vintage products. This is an opportunity for brands to get on board and leverage all things retro.
From Food Navigator
Fat is where the flavour is, but Mintel has asserted the need to find plant-based alternatives that can deliver on taste and nutrition. With the focus still very much on mimicry for consumers who are looking to plant-based alternatives, 39% of surveyed consumers said they would not repurchase alternatives due to unmet taste expectations.
Many consumers still monitor fat intake as a way of eating healthy. According to Stephanie Mantucci, associate director of food science at Mintel, 35% of consumers who choose plant-based foods say they’re trying to reduce saturated fat intake. However, plant-based alternatives like the Impossible Burger do not offer much reduction. Coconut and sunflower oils are major players when it comes to finding alternatives, but the situation in Ukraine has impacted supply chains. Mantucci calls for investment in technology to bring about the next generation of better tasting (and healthier) plant-based products.
Sevendots Partner Andrea Bielli says:
“The taste performance of plant-based meat is still a challenge and fat contribution could be a solution. However, we know consumers opt for plant-based as a healthier choice. So, what is the role fat can play in finding the right combination of taste and healthiness? Here we have another challenge for this category that could simply be avoided by moving out of the mimicry approach and into other methods.”Andrea Bielli
In short: Innovation is still needed when it comes to fat content in plant-based products, as currently there are issues for consumers who aren’t having their taste and nutrition expectations met by the market.
There you have it, another month rounded up! We hope you’re having a great August so far and look forward to catching up with you again next month.