Fair Trade Impacts Consumers Buying Decisions

A new study conducted at the University of Bonn and published in the journal Frontiers in Behavioral Neuroscience found consumers are willing to pay on average 30 percent more for ethically produced goods, such as chocolate, fats and oils, fruit and sugar, compared to their conventionally produced counterparts.

In the United States, Fair Trade USA certifies coffee, tea and herbs, cocoa, fresh fruit and vegetables, sugar, beans and grains, flowers, nuts, oils and butters, honey and spices, wine and apparel, and certified ingredients used in ready-to-drink beverages, body care products and spirits. It also is exploring certification in gold and precious metals, seafood and diamonds.

For the study, researchers analyzed the neural pathways involved in processing products with a Fair Trade logo. They identified a potential mechanism that explains why Fair Trade products are evaluated more positively. For instance, activity in the brain’s reward center increases and thereby alters willingness to pay computations. In a second experiment, researchers found study participants said foods labeled with the Fair Trade logo tasted better than their conventionally produced counterparts.

This latest study punctuates the fact that sustainability isn’t just a buzzword or fad. The overall concept of sustainability—economical, ecological, and ethical and social—is the new normal, especially when it comes to the production of food and beverages. No company is too big to ignore the demands of their consumers, and the same goes for their suppliers, agricultural producers and traders with whom they do business.

Curious about which food and beverage companies are doing their part to follow sustainable business practices? In April 2015, Oxfam Internationals’ “Behind the Brands" campaign ranked the Big 10 international food and beverage companies—Associated British Foods (ABF), Coca-Cola, Danone, General Mills, Kellogg, Mars, Mondelez, Nestlé, PepsiCo and Unilever—on their policies and commitments to improve food security and sustainability. The scorecard covered seven themes impacting the lives of people living in poverty around the world: transparency, farmers, women, agricultural workers, access to land, water and climate change.

To the food and beverage industry, this takes on a critical importance, as the global population is predicted to grow from 7 billion in 2012 to 8.9 billion by 2050, and now more than ever, there is increased pressure to find efficient and sustainable ways to feed the global population.