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STR 2020
05 Consumer
5.1Key trends
5.2Will the pandemic change consumer attitudes to sustainability?
5.3Towards an inclusive and resilient transition in food systems

5.1

5.1 Consumers have enormous economic power. The challenge is how to channel this towards sustainable outcomes

Figure 147: Consumption spending as a share of GDP, 2008-20
Despite efficiency improvements, our societies consume unsustainable levels of raw materials

Global extraction of raw materials continues to accelerate rapidly. Global plastics production remains unsustainably high.

Figure 148: World extraction of raw materials, by type, 1970-2019
Figure 149: The fate of plastic, global, latest estimate

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While some of us are over-consuming, others don't have enough

The number of overweight and obese people continues to rise, while the number of malnourished people has stopped declining.

Figure 150: Distribution of body-mass index, global, 1970-2020
Figure 151: Share of people who are malnourished, by country income level, 2000-19

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Shifting to sustainable materials was an increasingly important theme for businesses before the pandemic

Regulations to discourage the use of plastics have been proliferating. The plastics industry and their political allies have used COVID-19 to make the case for single-use plastics as a sanitary option. This has resulted in several plastics bans being delayed.

Figure 152: New regulations on single-use plastics, global, 1990-2017
The pandemic has accelerated many consumer trends, but the depth and persistence of these changes is not yet clear
Figure 153: Impact of COVID-19 on shopping behaviour, % of consumers
Figure 154: Share of people who report spending more time with devices

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A growing number of people are now choosing not to fly due to the climate impact

Airline-passenger numbers in Sweden were falling long before the pandemic.

Figure 155: Airline-passenger numbers, Sweden, 2003-19, year-on-year change

Flygskam or “flight shame” has travelled beyond Sweden, becoming flugscham in German, lentohapea in Finnish and vliegschaamte in Dutch. It has also inspired a spinoff Swedish expression: tågskryt, or “train brag”, for when someone shows off about their virtuous, rail-based holidays.

The Economist

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5.2

5.2 Will the pandemic change consumer attitudes to sustainability?

Global awareness of the climate crisis was accelerating before the pandemic
Figure 156: Newspaper coverage of the climate crisis, 2000-20

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People have expressed greater willingness to prioritise investment in environmental protection and climate security

The share of US citizens expressing sustainable views has risen by half in the past decade. More people believe that environmental protection is more important than economic growth.

Figure 157: Share of US citizens who say environment and climate should be a top priority for the president and Congress, 2009-19
A catastrophic recession will put the ethos of sustainability to the test

Unprecedented declines in living standards due to the pandemic may affect consumer preferences in ways that are hard to predict.

Figure 158: GDP growth rate, US, 1947-2020

Seasonally adjusted annualised rate

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There is some evidence that people are less interested in sustainability
Figure 159: Year-on-year change in global search interest for “sustainability”
Figure 160: Year-on-year change in global search interest for “plastic waste”
Overall, attitudes to sustainability appear to be resilient

Young Britons are more likely to say that climate change is more serious than COVID-19. Most people globally say that climate change is as serious as COVID-19.

Figure 161: In the long term, is climate change as serious as COVID-19? Global survey, 2020

Excluding undecideds and don’t-knows

Figure 162: “With protests going on in the US and elsewhere, are there more important issues than COVID-19?“
Consumer companies’ approach to the pandemic could define consumer attitudes for years to come

Consumers are closely watching how companies respond to the pandemic, while websites such as DidTheyHelp.com are tracking which firms behaved in a sustainable way.

Figure 163: ”Brands who place profit before people will lose my trust forever”

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People want a sustainable economic recovery from the pandemic
Figure 164: Share of people who believe that ”In the recovery, it's important that the government prioritises climate change”

Excluding undecideds and don't-knows

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Will the pandemic change consumer attitudes?
Accelerating sustainability trends

The pandemic may reset consumer expectations and behaviours in ways that could (with policy support) become more permanent. Well-being is increasingly understood to be about more than consumption and materialism, once basic needs have been met. It opens up new opportunities to align individual behaviour with planetary boundaries.

This is fertile ground for new consumer trends. The potential will only be realised, however, through further innovation by businesses supported by robust policy frameworks. In the short term, there is a risk that we witness something of a consumerist frenzy as the lockdown is relaxed.

Climate action

Before the pandemic there were early signs of a structural shift in consumers’ preferences. In the face of an era of economic upheaval, high unemployment and weak wage growth there are some headwinds to this trend.

Plastics have become something of a test case. A huge shift in public perception had occurred before the pandemic struck. Some in the industry are working hard to make a renewed positive case for plastic, for instance by highlighting its role in personal protective equipment and because of its higher value addition.

Radical partnerships

The broad commitment to sustainability and climate-sensitive purchases appears robust. The idea that companies with social purpose outperform competitors, especially in times of crisis, has gained currency. Many brands have been pushing further into the realms of purpose and sustainability and they contribute to dealing with the crisis.

During the pandemic, companies have been working together in novel partnerships which include regulators and other stakeholders. We expect these partnerships to lay the ground for longer-term collaboration on other issues.

5.3

5.3 Towards an inclusive and resilient transition in food systems

Our food systems have huge hidden costs

The externalities of food and land systems are not included in market prices

Figure 165: The hidden costs of global food and land-use systems

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A shift to sustainable diets is needed alongside a transformation in production. Interest in meat alternatives is growing

The growth rate of global beef production has sharply slowed in recent years, while plant-based meat is now widely known about.

Figure 166: Compound annual growth rate in beef production, 1971-2017
Figure 167: Have you considered purchasing/consuming a plant-based protein option?

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Sales of plant-based products are rising, and the amount of choice is increasing
Figure 168: Plant-based product landscape
Figure 169: Sales by product, US, 2017-2019

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Technological progress has been rapid, and financing has grown

Precision fermentation, a technology that enables the programming of micro-organisms to produce complex organic molecules, is now cost-effective in food production. Funding to agrifood tech start-ups has risen sharply in recent years.

Figure 170: Funding to agrifood tech start-ups, $bn, 2012-19
Figure 171: Cost of producing protein, 1990-2030

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Interest in organic and plant-based food continues to rise

Even during the pandemic, organic-food sales have continued to rise. The plant-based food market has experienced rapid growth globally. Direct farm-to-consumer programmes is also growing.

Figure 172: Food sales, UK, by type, 2014-19
Figure 173: Plant-based food market, US, 2017-19

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Ensuring access to healthy, sustainable food for everyone remains a huge challenge

Poor areas are much less likely to have farmers markets nearby. But they are much more likely to have a high concentration of fast-food outlets.

Figure 174: Food desert and farmers' market by socio-economic status
Figure 175: Relationship between density of fast food outlets and deprivation

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A big contribution could be made by tackling food waste

North America and Europe account for a disproportionate share of global food waste. Fruits and vegetables are especially likely to go to waste.

Figure 176: Food waste by region, % of production
Figure 177: Food consumption, loss and waste

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Despite the initial rush on supermarket shelves, food supplies have so far been resilient to the COVID-19 shock
Figure 178: Global food price index, real terms, 1990-2020
Figure 179: Cereal stocks, global, 2011-20

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Food insecurity is rising fast due to inability to pay, a major indirect effect of the pandemic

In food-importing regions in particular, consumers face a sharp drop in incomes. This will reduce their ability to pay for food. The UN estimates that the economic fallout from COVID-19 could result in the number of people suffering from acute hunger doubling to 265m over the course of this year.

While overall food prices are not spiking, particular countries heavily reliant on certain imports are seeing price spikes. Rice prices have risen globally and India is seeing spikes in a number of food prices, including meat and fish.

Figure 180: Price index, meat and fish, India, 2019-20

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The lockdown has also left many people exposed to hunger in the developed world

In March 2020 UK food banks saw far higher usage than the year before.

Thousands in the US have queued for food banks in recent months.

Figure 181: Number of visitors to food banks, UK, by week of March, 2019-20
Figure 182: Percentage of households that sometimes or often did not have enough to eat in the previous week, US, May/June 2020, by race and ethnicity

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Some companies are helping restaurants and other food services through the crisis

To help Wonoloers who use our platform respond to COVID-19, we are taking immediate action in three ways: 1. We are expanding our Flex Time Off program to all Wonoloers retroactively. This will preclude Wonoloers, sick or otherwise, from having to face deciding whether to earn a paycheck or go to the doctor. 2. We will pay Wonoloers for up to 14 days of quarantine. 3. We are excusing late withdrawals for sick Wonoloers.

Wonolo, Inc. (March, 2020)

Toast, the restaurant management platform, launched its 'Rally for Restaurants' initiative in March 2020

Toast, Inc.

An inclusive and resilient transition in food systems
Accelerating sustainability trends

During lockdown, many people have been cooking more, thinking about their connection with food and food systems, and avoiding waste. There has also been a rapid adoption of food-delivery services. These are important entry points for future policy action and for new product innovation.

Climate action

It is too soon to tell if pre-existing trends in the emergence of healthier diets and plant-based foods will accelerate, but we believe this is the direction of travel. Progress on healthy and sustainable diets is critical for climate action and meeting the Sustainable Development Goals.

We continue to see exciting innovations in sustainable food production, from precision agriculture and aquaculture to novel alternative proteins. However, we would like to see much faster progress in the transition to sustainable food systems at scale, given the impact of agriculture on soil quality, water availability and carbon capture, as well as nutrition.

Radical partnerships

Collective action is urgently needed to address uneven access to sustainable and affordable diets. Inequality of nutrition is being highlighted by the economic impacts of the pandemic. Poor nutrition will also undermine countries’ attempts to restart their economies as it is critical for worker health, productivity and education.

It has taken the emergence of new private-sector partnerships and government support to keep food retail, restaurants and other food-service industries afloat during lockdown. These new partnerships could form the foundation of a new post-pandemic sustainable food economy.