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The Promise of
Ethical Consumption


       Dara O’Rourke
 UC Berkeley and GoodGuide
New Market Dynamics
Failure of Traditional
State & Intergovernmental
        Regulation
Consumers as Potential
  Point of Leverage
over Global Production
Consumers Say
 They Care…
76% say they consider
environmental and social
issues when purchasing.
73% say they are
willing to pay more for
    green products.
67% say they have
boycotted a company on
    ethical grounds
Variations of Ethical
   Consumption
Growth in Ethical Consumption

  Organic Food: from $12 billion (2005) => $21 billion (2009)

  Fair Trade: from €200 million (2000) => €3.4 billion (2010)

    Local Foods: from $4 billion (2002) => $7 billion (2011)

    Farmers’ Markets: from 1,755 (1994) => 6,132 (2010)

Ethical Personal Care: $5.3 billion (2005) => $8.1 billion (2009
Product Introductions with Green Claims


                  800
                                                                                       Alcoholic Beverages

                                                                                       Baby Food

                  700                                                                  Bakery

                                                                                       Breakfast Cereals
                  600
                                                                                       Color Cosmetics

                                                                                       Desserts and Ice
                  500
                                                                                       Cream
                                                                                       Dishwashing
Number per Year




                                                                                       Products
                  400
                                                                                       Fabric Care

                                                                                       Hair Products
                  300                                                                  Non-alcoholic
                                                                                       Beverages
                                                                                       Paper Products
                  200
                                                                                       Pet Food

                                                                                       Skincare
                  100

                                                                                       Snacks

                    0                                                                  Soap and Bath
                        2002   2003   2004   2005   2006   2007   2008   2009   2010
New Businesses
       and
New Business Models
Alta Gracia
Still…a Huge Gap
between What People Say
   and What They Do
Consumers are
Constrained by Habit,
Status, Manipulative
   Marketing, and
 Lack of Information
People Need:
      Better Information,
       While Shopping,
 Showing Impacts of Decisions,
Showing People “Like You” Care,
  Simple, Easy, Empowering,
“On Ramp” to Collective Action.
A platform for transparency
into the environmental, social,
     and health impacts of
   products and companies.
Actionable Information




• Summary rating combines health, environmental and social impacts
• 0 – 10 scale for ease-of-understanding
• Distributional information for quick comparison
• Ratings explanations spotlight key indicators driving scores
Science-Based
@Moment of Decision
Social Graph + Interest Graph
Personalized
Shop Online with Your Preferences
Feedback on Your Purchases
Lessons
• Changing Consumers is Difficult
• Make Visible the Invisible
• Show People They Can Have an Impact
• Scientific Information Alone Will Not
  Change Most People
• Need to Bring in Behavioral Dynamics
• Need to move from Individual to Collective
  Action
• Key Roles for Government & NGOs
Turning Point in
Market Transparency and
Consumer Empowerment
Ethical Consumption
   can complement
 NGO Strategies and
Government Regulation
Dara O’Rourke
@daraorourke

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Ethical Consumption - MIT & Boston Review - Nov. 3, 2011

Hinweis der Redaktion

  1. Thank you to Boston Review and MIT Political Science Dept. And to all of the respondents. Really unique interaction as an academic,
  2. We are at a critical inflection point. Problems are mounting – climate change, biodiversity loss, industrial pollution, cancer rates, human rights abuses, obesity… Consumers are part of these problems…and a part of the solutions. We are entering a new age of more transparent and accountable markets. Consumers can see the impacts of products, supply chains, companies. See the stories behind their products. Cell phones can scan products, access environmental, social, and health information about the product, View live webcams of the factory that made the product, Skype with a worker from the factory, Access information from the NGOs they most trust;Instantly find out if the product passes or fails your screens: buy or not buy a product based on aggregation and filtering of this data through their personal screens, friends’ recommendations, etc.
  3. Complex, cross-border transactions; rapid movement between suppliers; and limited transparency have made it virtually impossible for national governments to regulate global production.The U.S. government does not regulate the production methods of global firms operating in other countries (in part because of WTO rules), and the Chinese government has shown little inclination and even less capacity to regulate firms such as Foxconn
  4. Original Tea Party…before Glen Beck’s Tea Party…
  5. About the products they consume: Where they were made? How they were made? Impacts on their Health? Environment? Workers?More than Brand & PriceIncreasingly cynical about marketing claimsGrowing List of Concerns:Ingredients, Contaminants, Health Impacts, Climate, etc. What goes “In, On, Around” our families.Consumers know more, and share more Sustainability as part of Global Supply Chains
  6. How many of You have avoided a company?
  7. Over 300 Eco-Logos in the US and Europe.
  8. Attitudes-Behavior Gap
  9. 25 staff140,000 products12 categoriesEnviro. Social. Health
  10. Created a valuable data asset of over 75,000 products.