Sustainability is the ‘hot topic these months, even in the FMCG world‘. And so it is that the Imagine Observatory, in its sixth edition (Oi 2019-2), devotes a special in-depth study to it. Without neglecting Made in Italy and short supply chain, the cornerstone of our consumption. Insight.
Observatory I guess. The consumption scenario through labels
The Immagino Observatory–designed by GS1-Italy, with the support of Nielsen–has become in just a few years the main source of information regarding FMCG(Fast Moving Consumer Goods) consumption in Italy. With the unique prerogative of tracking sales through the exact identification of each reference displayed on the shelf. Through the Immagino system that GS1-Italy itself introduced to Italian retail, in planetary vanguard.
‘Product labels tell the story of Italians’ consumption’. A worthy aphorism, consumers buy what they identify through a set of wording. And statistical data on consumption possible come disaggregated to the point of identifying consumption trends of products that, in different categories, express various concepts (e.g., organic, fair, and sustainable,
made in Italy
).
The number of references surveyed in the Immagino Observatory report now under review exceeds 106 thousand. (1) 30 thousand more SKUs(Stock Keeping Units) than in the previous edition, which already offered a broad and representative scenario of the Italian market in 2018.
Sustainability, demand and supply
Consumer expectations of supply chain sustainability are very high. The survey performed by Nielsen highlights the following:
- 74 percent of respondents consider it ‘extremely‘ or ‘very important‘ that FMCG companies take actions to protect the environment, ensuring greater respect for ecosystems, people and animals.
- 61 percent say they are ‘fairlycertain’ (45 percent) or ‘very certain‘ (16 percent) that they will change their consumption and purchasing habits to reduce their environmental impact,
- 20 percent are ‘willing to spend more to buy products that offer quality, safety and environmental friendliness.’ (2)
Industry and distribution have been able to intercept this consumer trend fairly quickly, given the time and resources required to reorganize supply chains and processes, but also just to program new product lines. Never to be underestimated is the risk, of the boomerang effect of mere greenwashing operations.
The ‘ greenbasket’ on supermarket shelves
The ‘ greenbasket’ composed by the Immagino Observatory consists of 19,182 products, which stand out because they carry at least one claim on the label that can be traced back to the idea of ‘sustainability. We therefore refer to 18.0 percent of shelf references and 19.4 percent of turnover. With € 7 billion in sales in hyper- and supermarket channels in the 12 months ended June 2019 (+3.4 percent).
‘Sustainability is making its way onto labels, in some cases taking up more space than the brand itself, becoming a brand itself. Thus the environmentally conscious consumer will be influenced by how the material from which a water bottle is made is communicated (or not communicated), whether it is recyclable, whether it is even compostable. Timidly, new claims are appearing that refer to supply chain, traceability, antibiotic-free, probiotics, polyphenols, sustainable agriculture, flavored, spicy, gourmet… and beyond‘ (Marco Cuppini, Immagino Observatory, GS1-Italy).
The labels examined, it is worth reiterating, are subject to a statistical analysis that is useful in recording variation, even significant variation, in the presentation of products on the shelf. But it is clearly not suitable for assessing the reliability nor the actual significance of individual commercial information with respect to sustainable development goals, the breadth of which, as noted above, must encompass a wide range of elements.
Label statements pertaining to ‘sustainability’ were divided into four areas in this report:
1) resources, ‘sustainable’ management
2) Agriculture and animal husbandry, ‘sustainable’ methods,
3) Workers and forests, respect and safeguard,
4) Sustainable fishing and respect for animals, adherence to protocols.
1) Sustainable resource management
The 11 claims considered in this area are ‘sustainability‘, ‘sustainable cleaning‘ (certification), ‘reduced environmental impact‘, ‘with recycled material‘, ‘phosphate-free’,‘biodegradable‘, ‘plant-based‘ (in home care and personal care), ‘wastereduction’, ‘CO₂ emission reduction/control’,‘Ecolabel‘ (non-food, certification), ‘less plastic‘.
5,841 products, 5.5% of the ‘green basket,’ carry one or more of the above claims on their labels. 2.854 billion in sales, up (+3.9%, 8% of the basket). ‘Household care products account for 42.8 percent of the turnover, including washing machine laundry products (growing strongly), fabric softeners and dishwasher detergents. This is followed by food grocery products (25.5 percent) and refrigeration products (12.5 percent)’. Only 193 brands were involved.
‘Sustainability’
is the ubiquitous word, referring to the preservation of land and resources, rather than agriculture and animal husbandry, (3) working conditions and the environment. € 1.359 billion in sales (3.8% of total FMCG), up (+4.0%).
Waste reduction and ‘ sustainable packaging ‘ record double-digit growth. Sales of products that boast reduced waste at the consumption stage (e.g., controlled dosing, special dispensers, +17.7%), such as those related to variously environmentally friendly packaging (+26%), are increasing. Still overlooked, however-we add, recalling a teaching by Mario Gasbarrino (former CEO of Unes-U2 Supermarkets)-is the crucial value of the paradigm shift on detergents and cleaners, which should be sold only in concentrated versions (with huge savings on packaging and transportation).
Commitments to reduce or offset CO2 emissions, on the other hand, are still too few, given the growing and dutiful attention to
climate change
. Only 19 companies out of 206 of the more than 106,000 products analyzed by the Immagino Observatory report this. And the indication ‘less plastic‘ is also rare, found on only 132 packages, albeit up (+19.5 percent, € 48 million).
2) Sustainable agriculture and animal husbandry
Sustainable agriculture and animal husbandry claims under consideration are ‘organic/EU organic‘, ‘GMO-free‘, (4) ‘
100% natural ingredients
‘, ‘
antibiotic-free
‘, ‘organic personal care‘, ‘Ecocert‘ (certification), ‘
supply chain/traceability
‘.
As many as 10,367 products for € 2.245 million sell-out (6.3 percent of the total), brisk annual growth (+5.7 percent):
– organic dominates the scene with 7,227 products and more than 1.1 billion euros in turnover (+2.8 percent),
– supply chain and traceability guarantees of (controlled, certified, guaranteed, Italian and territory, short chain and km0), out of 861 labels for € 488 million sell-out, are a rising star (+15.4%),
– ‘without antibiotics’
literally flies (sold-out +87.1 percent), with marked over growth in supply and demand, ‘confirming the ample room available to expand assortments in the future.’ (5)
3, 4) Fair supply chains and sustainable fisheries.
Social and environmental responsibility expressed through certifications on fair supply chains, respect for workers and the environment is associated with the names of organizations operating in the relevant fields (e.g., ‘Fairtrade,’ ‘FSC,’ ‘UTZ’). 4,226 products, € 2.150 billion in sales (+1.4 percent).
Sustainable fisheries and animal welfare certification protocols-such as ‘Friends of the sea’ and ‘cruelty free‘-are still marginal, unfortunately. 939 products (0.9%) and 437 million euros in sales, albeit up (+2.3%).
Made in Italy, 100% made in Italy
The tricolor cart is distinguished by indications such as ‘made in Italy,‘ ‘product in Italy,’ ‘only Italian ingredients,’ ‘100% Italian,’ and geographical indications (PDO, PGI, DOP, DOC, DOCG). As well as the names of the regions and the Italian flag. And it is the most significant phenomenon, affecting 25.2 percent of products on the shelf. Nearly 20 thousand products (19,228), more than 7.1 billion in turnover.
‘Italian-ness has entered powerfully, and seems to be steadily, into the shopping cart: now one in four products bought in supermarkets and hypermarkets carries a reference to its national origin on the label.’ (Imagine Observatory)
The Italian flag is the most common sign, on 14.5 percent of the products surveyed. And it now triggers the requirement, among other things, to indicate the different origin of the primary ingredient on the label (under EU Reg. 2018/775, from 1.4.20). ‘100% Italian’ grinds further consensus (+3.5 percent), as do regional identities (+2.6 percent), which alone develop more than 2.34 billion euros, 10.8 percent of food references surveyed by the Immagino Observatory.
Sustainable spending
and short supply chain, the path is marked. The
blockchain
, an opportunity to ensure actions as well as words. (6)
Dario Dongo and Sabrina Bergamini
Notes
(1) The Oi Report 2019-2 can be downloaded for free at https://osservatorioimmagino.it/
(2) Source Nielsen Sustainable Shoppers Report 2018, cited in the paper in footnote 1
(3) NB: The concept of ‘sustainable agriculture‘ is often misused, as it is a common characteristic of all agricultural products produced in the EU based on mandatory requirements. See https://www.greatitalianfoodtrade .it/progresso/agricoltura-sostenibile-l-abc
(4) The ‘GMO-free‘ concept presents, in the writer’s opinion, an interesting development opportunity in foods of animal origin from ‘GMO-free‘ supply chains. That is, without the use of GMO soybeans in farm animal feed (see https://www.greatitalianfoodtrade .it/consum-attori/i-crimini-dell-amazzonia-nelle-nostre-dop). Conversely, attention should be paid to the risk of ‘new GMOs’ (NBT) in fruits and vegetables (e.g., endive)
(5) Not surprisingly, the survey conducted by Efsa for Eurobarometer on 7.6.19 showed antibiotic residues in food topping the list of European citizens’ fears. V. https://www.greatitalianfoodtrade.it/consum-attori/i-timori-nel-piatto-indagine-di-eurobarometro
(6) Provided it is true blockchain, public and interoperable, and not a fraudulent presentation as ‘blockchain‘ of closed systems that have nothing to do with it. See the article https://www.greatitalianfoodtrade.it/consum-attori/blockchain-vero-o-falso-la-frode-all-angolo
Dario Dongo, lawyer and journalist, PhD in international food law, founder of WIISE (FARE - GIFT - Food Times) and Égalité.
Journalist. Consumption, rights, nutrition, social, environment. Head of Consumers Help. She collaborated with ResetDOC, Il Riformista, La Nuova Ecologia, IMGPress.
