Business Assurance - ViewPoint

What matters to consumers in the circular transition?

Insights specific to the fashion and electronics industries as well as plastic packaging.

Fashion: Circular fashion products are visible

In the last 12 months, 67.6% have seen a circular fashion product in store or online. More than half have bought at least one circular fashion product. A total of 32.4% have not seen a circular fashion product, which highlights improvement opportunities in marketing and communication around circularity. The youngest (18-24 age group) are most engaged, with 84% having seen a circular fashion product and 43.6% having bought at least one.

Fashion: Style and purchasing power drive circular buying decisions

The primary reasons for choosing a circular product are still style and the price. Contributing towards environmental and circular causes ranks third. Companies should highlight the value of greener and circular manufacturing and sustainable materials but must consider the preferences and characteristics of the targeted customer segment, for example style or purchasing power. Price is especially relevant for the younger generations, which is potentially linked to their purchasing power. For those 55 years and older, the act of being sustainable scores above average (38.3%). While cost is not irrelevant, they are willing to pay more than their younger counterparts perhaps indicating that as purchasing power increases so does the possibility to act more freely and according to personal conviction.

Fashion: Price is an engagement pain point

For consumers who chose not to buy a product, price is a definite pain point (34.1%). Trailing a bit behind are factors such as “thought the quality would not be the same” (15.9%) and “did not trust the associated information” (10.3%). While the fashion industry overall seems to be good at communicating product claims, there could be a need to build more trust and traceability especially towards consumers. This can be challenging in face of younger generations’ declining trust in brands and the information shared.

Fashion: End-of-life cycle engagement is high and driven by personal reasons

There seems to be a high awareness of re-use and repurposing and less waste mentality than in the past, with 89.2% having engaged in at least one end-of-life cycle option. Of those, 49.7% have donated to charities or a goodwill programme, 37.9% have made sure a product was reused, 32.7% have repaired products and 31.6% have resold to a second-hand marketplace. The high numbers relating to charities and goodwill could potentially be explained by the accessibility in many countries which makes it easy to donate.

Younger generations seem more into re-use (45.8% of those in the 18-39 age group) while those above 55 focus more on repair (43.4%).

Consumers tend to engage based on personal reasons, for example doing something for the community (52.9%) or decluttering (43.3%). As expected, access to end-of-life programmes is an important factor (42.1%).

Fashion: Consumers consider multiple aspects when deciding

Several aspects seem to come into play when consumers decide whether to buy circular products. Information on the ecological footprint is important to 49.1%, working and labour conditions to 45.7%, the quality of the product to 38% and certifications, verified labels and validated sustainability claims to 37.8%. This is followed by information on the supply chain (35.1%) and information about the care, repair and disposal of the product (35%). This picture indicates that manufacturers and brands have multiple circular dimensions on which to be active.

Electronics: Daily use and related risks influence decisions

All aspects – combining those answering extremely and quite important – are rated 66% or higher. Although the survey focuses on small electronics and appliances, the price of products could influence this picture. The aspects closest to the consumer’s daily use and related risk seem to rank highest. Among the most important are durability and the associated information and guarantee (88.2%), the possibility to repair and access to repair services (83.7%) and end-of-life sustainability (78.3%). This could be consistent with the current visibility given to circular programmes for consumer electronics, such as recycling, repair and return.

Electronics: Old products tend to remain at home

Of those asked, 27.7% still have their broken electronic devices in the house. Only 20.7% have recycled it through a locally available program. If the device is still working, 19% re-use it. Smaller electronic devices are easily stored at home, so people have less incentive to recycle them. Moreover, take-back programmes have tended not to be well advertised. If consumers do not know they can bring back products, materials that still have a residual value may never be recycled.

Electronics: Personal reasons drive end-of-life engagement

A total of 95.4% have engaged in at least one end-of-life option and 53% of those did it to contribute to community benefits and the environment. For 41.8% it was because it was easy to do, convenient and accessible and for 34.2% it was to declutter. The personal perspective and motivation seem to be guiding the behavioural pattern of consumers.

Financial incentives scores fairly high (31%) as well. This could be linked to the electronic industry’s more structured programmes for taking items back and awareness of used electronic products’ residual value.

Those over 55 are more willing to contribute toward a brand’s strategy (25.6% vs 20.2% overall), indicating a sense of loyalty and an opportunity for electronics companies to reach out to this age group.

Plastic: Almost half consider packaging sustainability

Awareness around plastic packaging is surprisingly high. A total of 49.5% said they have decided not to purchase a product because the packaging was not sustainable. The high attention paid to this by the media – in particular to ocean plastic pollution – may be a contributing factor. It could potentially also explain the even higher numbers among the younger generations, i.e. 61.8% of those in the 18-24 age group and 58.6% of those in the 25-39 age group. Those answering “No” could potentially be influenced by the fact that it is possible to recycle plastic through domestic recycling programmes.

Plastic: Recycling programs influence plastic perception

A total of 29.9% answer that plastic packaging is always harmful, while 35.7% say that it is harmful only if not correctly disposed of. Media pressure, especially relating to ocean plastic pollution and its impact on biodiversity, could potentially influence this picture. The large number of respondents saying that plastic packaging is acceptable if responsibly disposed of or recycled shows the importance of the recycling programmes.

Plastic: Most solutions seen as sustainable

All the options presented have been perceived as sustainable. The most sustainable are a return scheme (78.2%), packaging made of recycled plastic (78.1%), packaging made of other material, such as paper or glass (77.4%) and bioplastics (68.4%). As all options are deemed sustainable, companies do not have to consider consumer awareness in their sustainable packaging decision. They can focus on their internal processes, calculating the actual impact of each option and choose the one that is more circular.

Plastic: Consumers do not distinguish between “recyclable” and “recycled” packaging”

There is no clear understanding of the difference between “recyclable packaging” and “plastic packaging that is recycled”, i.e. packaging made with post-consumer plastic. The lack of consumer awareness is a risk, favouring companies that invest in recyclable materials only rather than packaging made of post-consumer recycled plastic. Recyclable plastic packaging is only potentially circular; its circularity relies on the consumer properly disposing of the packaging so that it can be recycled. On the contrary, the manufacturing packaging from recycled materials is a truly circular initiative.

Plastic: Society is not moving fast enough

A surprisingly high share say they do not think society is moving fast enough towards plastic circularity (59.5%). The younger generations seem slightly more optimistic though, with 49.7% (18-24 age group) and 50.4% (25-39 age group) thinking we are moving quite fast. This may be influenced by the fact that these age groups take action, feel they contribute and thus perceive more progress towards a circular future.

Plastic: More innovation and regulation needed

Of those who do not believe that society is not moving fast enough towards plastic circularity, 19.9% think we need more material innovation to eliminate plastic, while 15.6% think we need more regulation and enforcement. A total of 12.8% think brands that use plastic packaging should do more. Only 11.2% place the responsibility on consumers to only buy sustainable packaging and to recycle. This indicates that consumers see this as a systemic problem to be fixed at the core by corporations and through legislation to change society’s course and individuals’ behaviours. Interestingly, the 18-24 age group believes more in regulation (20.9%), while those above 55 years of age look more to increased innovation (32.2%) and consumer involvement (18.3%). This could perhaps be influenced by this age group’s experience that such types of regulation have tended to have limited effects.