The economy is shifting, and most of us will have noticed the effects. Between inflation and global supply chain issues, our wallets feel the crunch. Price increases, national shortages of everyday items, and economic instability all have consumers more conscious of where their dollar is going.
Before the pandemic, a surge of ecologically-friendly mini revolutions was underway. The plant-based space was booming, and there was a renewed interest in sustainability. Restaurants offered recyclable or compostable to-go containers, and single-use plastics were replaced, banned, or discouraged.
We were headed in the right direction with an incredible influx of innovations. We saw beverage straws made of hay, straw-free beverage lids, compostable potato starch plastics, seaweed sauce packets, and blockchain-tracked seafood packages. Companies and consumers were excited to finally tackle the waste and sustainability issues plaguing the food and beverage industry for decades.
But all of that changed when lockdown increased our dependence on single-use items and progress on sustainability stalled. As we struggle to get back on track, people continue to find a balance between cost and lifestyle versus ecological impact.
Money is a stressor for many. In fact, 34% say money is one of their top three causes of stress. And while most of those individuals fall into the lower income levels (49%), money stress affects those in the middle- and upper-income levels as well (30% and 21%, respectively). Those with money as a top stressor are also more likely to say they have a higher stress level.
Among this group who have money as a top stressor, the majority of people among the income groups all agree that they are concerned about global warming. And while they have this concern for the environment, most also agree that eco-friendly products are too expensive.
Looking into their spending habits, those in the lower income bracket are more likely to sacrifice green behaviors like buying eco-friendly or repurposing items. 31% of low-income people say they never purchase eco-friendly products, vs. 27% of middle and 24% of high.
Middle-income consumers are the most likely to try and buy locally grown or produced items, at least sometimes, while all income brackets are equally trying to decrease food waste.
Other green behaviors suffering from money woes include reducing single-use plastic use and buying organic products. Those in lower income brackets with money as a stressor are much more unlikely to buy organic products (45% saying they rarely or never do) than those in medium or high-income levels.
When we look at the buying habits of those with money as a stressor, they tend to over-index in pretty standard food purchases (regular soda, chips, traditional frozen pizzas, regular ice cream, etc.) They stick to what they know and aren’t likely to branch out and try new things outside their comfort zones. 78% say they will buy the same brands often, and 50% say that healthy foods are too expensive.
However, one thing this demographic is comfortable with (and 16% of them use to help deal with stress) is Cannabis. Cannabis flower is the product of choice, followed by pre-filled vapes, pre-rolls, and gummies, where these products over-index from the general population.
Breaking it down further, we see a shift as income levels increase from lower income preferring flower/strain and pre-filled vapes and higher incomes preferring gummies.
Taken together, this means that as money woes increase, consumers will have to make conscious decisions about where they want to spend their dollars. Green living and eco-friendly purchases may take a back seat while families prioritize spending. The desire for eco-conscious products is still there, but some may find the price points prohibitive.
If you can focus innovation to make these products more accessible, consumers will likely gladly choose an eco-friendlier option. Climate change isn’t going anywhere, and the economy will bounce back. Companies should keep that in mind and be ready for it when it does. Want to learn more about how the economy affects the health and wellness industry? Check out Evergi’s Q2 2022 Quarterly Report.
Source: Evergi Consumer W3 2021-W2 2022
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