Quantifying Sustainable Living

In April 2021, Euromonitor ran a webinar Quantifying Megatrends: Expanding Your Portfolio in the Right Spaces, which discussed Euromonitor’s new tool for quantifying megatrends, and shared the methodology behind the data and the key findings.

This article explores the sustainable living megatrend, which talks about how consumers are increasingly embracing sustainable lifestyles and expecting businesses to stand up for social and environmental causes. Sustainable living has gained more traction in recent years, particularly accelerated by the Coronavirus (COVID-19) pandemic, which has given a push to conscious consumption and activism.

According to the Voice of the Consumer: Lifestyles Survey 2021, almost a third of global consumers buy from brands that are aligned with their values, while over a fourth boycott those that don’t share their social and political views, and over a fifth buy from purpose-driven brands.

Which are the biggest markets for Sustainable Living?

The sustainable living megatrend model provides a comprehensive framework to map the market potential for sustainable products across fourty key countries. The model helps to identify whitespace opportunities in those countries, where the shift from traditional to sustainable purchases is gaining traction.

Looking at market size, not surprisingly, the two biggest economies, US and China, are also the largest markets for sustainable living, followed by three European countries, France, Germany and the UK. In contrast, South Africa and Argentina are amongst the smallest markets for sustainable living (among the forty countries included in this model).

Sustainable Living by Market

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Source: Euromonitor International Megatrends Model, 2020

Looking at per capita expenditure, Western Europe, North America, and Australia, have developed markets for the sustainable living megatrend. With large market sizes and high per capita expenditure in sustainable products, these regions offer good opportunities to test and launch new sustainable products.

On average, consumers in Nordic countries such as Denmark, Sweden and The Netherlands, tend to spend more on sustainable products. Other countries where per capita expenditure in sustainable products is high are US and France (both ranking in the top five in per capita expenditure among the 40 countries included in this model).

In contrast, despite the high environmental awareness among Latin American consumers, the sustainable living market is still niche in the region, which is home to four of the ten markets with the smallest per capita consumption for sustainable living in the world.

Overlapping the two maps, looking at both market size and per capita expenditure for sustainable living provides interesting findings. In countries such as Mexico and Russia alongside countries in Asia Pacific, population size rather than greater spending per person is fuelling the market for sustainable products.

These less mature markets hold huge opportunities for companies that are able to innovate and provide sustainable yet affordable solutions.

How to capitalise on opportunities for sustainable living?

It is crucial for businesses to understand where the future opportunities for the sustainable living market are, and how these opportunities vary by market.

• Where? Six European countries (France, Denmark, Sweden, Spain, Germany, and Italy) along with Australia, Vietnam, China, and Canada, will form the ten fastest growing markets between 2020 and 2025. These are key markets for businesses to have on their radar as sustainable living gathers further momentum and consumers are expected to increase their spending on sustainable products.

• How? While in countries such as Australia, Vietnam and Spain, food and beverage products with ethical claims offer the biggest opportunities, China is expected to lead growth in demand for meat substitutes, and organic products hold the greatest potential in markets such as Italy, Canada, France, Germany, Sweden, and Denmark.

Opportunities by Market: 2020

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Source: Euromonitor International Megatrends Model, 2020

Denmark is the market with the highest share of organic food revenue, globally. The country is a great example of how every player has a role and a responsibility to make sustainable choices mainstream. There are three key ingredients for the success of organic labels in Denmark – consumer trust, government support and retailer push.

With over half of Danish consumers trusting organic labels, the country is not only a key market for organic labels, it is also a leader in terms of organic production. The Danish Government has supported the switch to organic farming with subsides while also setting standards for organic labels.

Retailers are also responsible for influencing purchases by making organic products more visible on their shelves, accelerating growth in demand. In May 2021, Coop Denmark announced that an astonishing 42% of all food sold through its online platform coop.dk Mad is organic.

Sustainable Living: Opportunities in Denmark and China

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Source: Euromonitor International

In China, the biggest opportunities are in meat substitutes. The country accounts for 63% of the global market for meat substitutes, a number well above its contribution to the global market for meat products such as pork and beef.

The plant-based trend is very much on the radar of international companies operating in China and proof of this is clearly evident, not only in recent launches of plant-based products in the country, but also the establishment of plant-based production sites.

In June 2020, Cargill launched in China its retail brand PlantEver, a range of plant-based chicken nuggets and burgers, and few months later, Beyond Meat launched its plant-based minced pork, while also announcing the construction of two production plants in Shanghai.

Following this, in December 2020 Nestlé launched its own line of plant-based meat in China, with the company also planning to open a plant-based manufacturing site in the country.

Accelerated by the pandemic, the plant-based trend is expected to gain more attention over the next years, as consumers, governments and businesses take more responsibility for dealing with climate change, and look for ways to reduce carbon emissions.

For more information, watch the on-demand webinar and download the slides.