Fair Trade Products Going Mainstream

Discussion
Mar 10, 2011
George Anderson

While many American consumers are looking to save wherever
they can, there are also quite a few who are willing to pay a little
more for fair trade products. 

According to Fair Trade USA, mainstream grocery
stores saw the biggest increase of all retail channels in fair trade product
sales during 2010.

“We are encouraged by the fact that in spite of the economic recession,
consumers everywhere are embracing the idea that every purchase matters,” said
Cate Baril, director of business development, grocery and ingredients, at Fair
Trade USA. “We continue to see strong, double digit growth in the natural
and specialty channels. And we see even stronger growth in supermarkets where
sales are up 26 percent, as more stores are adding a greater variety of fair
trade certified products and increasing selection for consumers.”

Coffee
is the largest fair trade food category. Sales for coffee were up 33 percent
last year. Ready to drink tea and coffee sales jumped 39 percent.

Other categories
achieving sales increases included chocolate (19 percent), sweeteners (17 percent)
and frozen desserts (four percent).

Fair trade health and beauty products also
gained, with skin/body care up 32 percent. Aromatherapy and body oils were
up 19 percent.

Stacy Geagan Wagner, director of communications for Fair Trade USA,
said fair trade products are now found in stores ranging from Walmart to single-store
independents.

“It’s [fair trade] still such a small percentage of
the market that there’s room for everyone to grow,” Ms. Wagner
told Business
News Daily
.

Discussion Questions: In what product categories do you see the greatest upside for fair trade? Should retailers do more to promote fair trade products, or do they run the risk of raising questions about other products?

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10 Comments on "Fair Trade Products Going Mainstream"


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Odonna Mathews
Guest
Odonna Mathews
10 years 2 months ago

Consumers like choices and the fact that fair trade products are more prevalent at supermarkets and other stores is important. Products are appearing as private label, such as Trader Joe’s coffee, in special sections of the store, like Wegmans, as well as integrated throughout the store, such as Whole Foods and Walmart.
Clear and visible signing and product labeling are key to increasing more sales along with a short explanation of what fair products are and how they help local economies. Proper consumer information is essential and Fair Trade USA provides a lot of that for retailers and manufacturers.

Paula Rosenblum
Guest
10 years 2 months ago

I think crafts are a big deal here. I really enjoy buying products that do NOT say Made in China, and am happy to support developing countries like those in the Caribbean basin (Haiti comes to mind).

Supporting Fair Trade initiatives in developing countries, while rewarding environmentally sustainable practices will gradually help them learn to help themselves in a positive way. I think it’s great and would happily pay a bit more knowing that I was actually supporting this.

Paul R. Schottmiller
Guest
Paul R. Schottmiller
10 years 2 months ago

It isn’t clear whether revenue is up based on increased number and variety of products and increased distribution points or based on customers choosing these products over other non labeled products. I went back and read the source article as well and it doesn’t make it any clearer.

I don’t see any support for the conclusion offered that “there are also quite a few who are willing to pay a little more for fair trade products.”

Without some other analysis that better defines “quite a few” and “a little,” I have a healthy dose of skepticism, particularly in the face of other major influences like brand, price, and convenience. The source article rightly points out that this should not be confused with the “organic” wave (which has proven itself to be material).

Gordon Arnold
Guest
10 years 2 months ago

I am not so sure that this is a market increase at all. Judging from the number of small business failures it may just be a shift in supplier. There are many small business restaurants, ice cream and confection stores that are gone in recent times making it a do-it-yourself type means to satisfy. A good way to see opportunities might be to simply track over a 12 month period the business financial obituaries. This economy is a nightmare.

Al McClain
Guest
Al McClain
10 years 2 months ago

I see this as a slow growth business, off a small base. Not that there’s anything wrong with that, and Fair Trade products sound like something we should all support, when economics and a zillion other priorities permit. Consumers are so frazzled these days that I think it will take a very long time for this to go mainstream.

Craig Sundstrom
Guest
10 years 2 months ago

To build on an earlier comment: what exactly are we seeing here? Is it an expansion of goods labeled “fair trade,” and if so is it a real growth or simply a rebranding? As with “natural,””organic,” and most every other feel-good label that has become trendy in recent years, it’s hard to separate the wheat from the chaff once marketing becomes involved.

Janet Dorenkott
Guest
Janet Dorenkott
10 years 2 months ago

I agree with Paul. Although this is a great program, I don’t see the evidence that people are willing to pay more for fair trade products. In fact, I’m guessing most consumers are not even aware of Fair Trade Products. General merchandise is relevant because they are products you would not normally find on shelves, so they may buy them because they are different.

As far as produce goes, I see more and more local farmers set up markets at shopping centers and I enjoy the experience as well as knowing I’m supporting our local farmers. For produce that isn’t grown locally, I think people may buy them if they were aware of the Fair Trade program. I just don’t believe that awareness of the program is actually what’s driving those sales today.

M. Jericho Banks PhD
Guest
M. Jericho Banks PhD
10 years 2 months ago

On the “Late Night With Jimmy Fallon” show recently, Ben and Jerry of Ben & Jerry’s presented Jimmy with his own flavor. As one might expect of our favorite Mr. Naturals (look it up, youngsters), nearly every ingredient mentioned was preceded by the words, “fair trade.” And mentioned multiple times. Yadda, yadda, yadda. Fair trade chocolate, of course, but fair trade potato chips (yes, it’s an ingredient)?

I’ve done a bit of work with shade-grown, fair trade coffee in recent years, and am dismayed to learn that climate conditions have significantly reduced yields this season. High costs for fair trade beans, and even higher costs for SCARCE fair trade beans. We’ll see how both processors and consumers react. Will they remain loyal to fair trade coffee in spite of steeply escalating prices?

“Fair trade” falls into the same incomprehensible pit as “all-natural” and “organic.” Yes, our government is trying to ‘splain all this to us, but have you ever seen a clear definition of anything from our esteemed lawmakers?

Kai Clarke
Guest
10 years 2 months ago

I agree with my colleagues. This is probably an aberration of purchasing behavior that has nothing to do with product positioning, but just a blip in the market. It appears that most consumers are not truly aware of the presence of Fair Trade Products, and they are certainly not a destination category for these products. These products only occupy a small amount of presence in the consumer category as a whole, and for now, are simply unique items that do not drive a destination product focus.

Dirkjan Vis
Guest
Dirkjan Vis
10 years 2 months ago

In The Netherlands the government promoted it for a while I think. It used to be more expensive but lately in supermarkets it seems to be more and more mainstream. Online, the number of fair trade or biological products are still a small niche. Strange because the Internet would be such a great channel for it.

Wrote a Dutch topic earlier about the subject but it didn’t seem to have changed much.

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