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Understanding what today’s eco-conscious food consumers want

Restaurants, CPG manufacturers and food retailers are all investing in new, innovative ways to give eco-conscious consumers what they’re prioritizing in their food choices.

6 min read

Consumer Insights

Understanding what today’s eco-conscious food consumers want


This is Part 3 of 4 in a series of posts looking at how food companies, retailers and foodservice operators can reach four key consumer archetypes that are shaping the industry today. If you missed it, check out Part 1 and Part 2, and keep an eye out for the next post, which will focus on the comfort- and convenience-centric consumer.

Consumers are increasingly paying attention to how their food is produced and showing support for businesses that demonstrate care for the environment. From plant-based meat alternatives to waste initiatives and new packaging technologies, restaurants, consumer packaged goods manufacturers and food retailers are all investing in new, innovative ways to give eco-conscious consumers what they’re prioritizing in their food choices.

“More and more consumers are concerned with how products they purchase came to market,” said Darren Seifer, food industry analyst at NPD Group. “The story of the company has become a much larger part of the decision-making process for consumers than it has in the past.”

Higher state of consciousness

Millennials and Generation Z consumers tend to rank sustainability as a higher priority compared to older generations, according to Seifer, and research from IRI and the NYU Stern Center for Sustainable Business found millennials were most likely to purchase sustainability-marketed CPG products — even during the coronavirus pandemic.

“In the COVID-19 environment, sustainably marketed products have held their spot in the market share,” said Larry Levin, executive vice president of Market and Shopper Intelligence for IRI.

The category has significantly contributed to the growth of the CPG industry overall from 2015 to 2019, with CPG products that promoted their sustainability experiencing a 56% boost in dollar sales during the week ending March 15, according to data from IRI and the NYU Stern Center for Sustainable Business.

While millennials are buying these offerings at higher rates, the eco-friendly products are still being purchased across demographics, said Randi Kronthal-Sacco, a senior scholar at the NYU Stern Center for Sustainable Business. She added that for many consumers, becoming a parent is a “watershed moment” for purchasing sustainable products.

A newcomer to the sustainability-marketed food category in recent years, plant-based foods are surging in popularity. And while NPD found that concerns about sustainability were tertiary to taste and health for consumers who choose plant-based food and beverages, 22% of plant-based meat alternatives buyers cited environmental or ethical issues as a reason for purchasing, according to Market Insights data.

For these reasons, in order to keep attracting eco-conscious food consumers, the industry needs to maintain all three priorities — taste, health benefits and environmental impact, Seifer said. “The expectation for plant-based foods has now become about substitution without sacrifice,” he explained. 

In foodservice, over 50% of consumers in the United States said they are more likely to make a restaurant choice based on eco-friendly practices, according to the National Restaurant Association’s State of Restaurant Sustainability 2018 report, and the group’s What’s Hot 2020 report named eco-friendly packaging as a top trend for the year.

Do good and do well

Food and beverage consumers have voted with their dollars for sustainability, showing that eco-friendly practices can prove profitable for CPG manufacturers, food retailers and restaurant operators. Sustainability has been identified as a top trend across the industry, and the pandemic has further emphasized the importance of sustainable food production, according to Levin, who added that 23% of startups report the significance of environmentally friendly practices from both a manufacturing and retail perspective following the pandemic.

Still, some of the major challenges for the industry are about company mindset, according to Kronthal-Sacco. It is often simple to adopt sustainable practices, but many brands have failed to communicate these actions to green consumers, she explained. To attract those who are seeking out eco-conscious food and beverage consumption, brands need to make ethical changes and then advertise those changes through print and digital marketing platforms, as well as on packaging and menus, she said.

“It behooves the companies now to have a positive message about who they are, what they stand for and what their values are so that consumers can feel good about why their dollars are going to those values,” said Seifer.

Many CPG companies have committed to sustainable packaging goals, and several legacy brands are investing in new tech to reach a circular economy. Effective sustainability calls for both corporate and consumer participation, especially in regards to sustainable packaging; manufacturers must source reusable, recyclable or compostable materials, and customers must ensure that these products are disposed of properly.

“You need to make it easier for consumers to be a part of the [sustainability] movement … it should be something they don’t have to think that much about doing, it just comes as part of buying that product,” said Seifer.

As plant-based foods have proliferated the industry, consumers now expect to have these options available whether they’re shopping at specialty retailers or big-box stores and dining at independent eateries or popular chain restaurants. 

Burger King and KFC have partnered with plant-based brands Impossible Foods and Beyond Meat, respectively, to bring these meat alternatives to the foodservice operators’ menus. These new items create accessible eco-friendly choices for regular — or new — customers of these fast-food chains.

Ethical ingredient sourcing is a major component of sustainable food production, and many retailers and restaurants have employed innovative solutions to ensure the sustainability of their supply chains. 

Albertsons will stock leafy greens produced by indoor farming company Plenty Unlimited, which uses wind and solar power to grow its products. Publix has opted to offer local ingredients at a Florida location by tapping Brick Street Farms, a hydroponic farming company, to grow its lettuce on site. Research shows the indoor farming market is expected to be worth $40.25 billion by 2022, and the industry allows growers to reduce water use as well as carbon emissions.

“This is the future, and if you don’t adapt, you risk obsolescence,” Kronthal-Sacco said.

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