| Mainstreaming Fair Trade: The Role of Consumers | | | | products. Perhaps women are more aware of the |
| | | | limitations of Fair Trade products, such as |
| This article is based on a university research project | | | | unavailability and higher cost. |
| focused on understanding the growth of Fair Trade. | | | | The 41-55 age group was most aware of Fair Trade |
| The term Fair Trade can be difficult to define. It is | | | | (83%), and most likely to be both aware of Fair |
| generally presented as an ‘ethical’ alternative | | | | Trade and considering purchasing Fair Trade products |
| to conventional, or ‘free’ trade. It | | | | (63%). The findings can be related to the MORI |
| guarantees small scale producers a minimum price for | | | | survey, which identified that recognition of the |
| their produce, which is often defined as a fair price, | | | | fairtrade mark was highest for people in the age |
| or living wage. It forges a long-term relationship | | | | group 45-54. Consumers between the ages of 26-40 |
| between buyer and seller, thereby providing some | | | | followed in terms of awareness and purchasing |
| stability against market fluctuations. The Fair Trade | | | | power. Over half, 56%, of 16-25 year olds were |
| Labelling Organisation (FLO) also stipulates that Fair | | | | aware about Fair Trade products, but only 19% |
| Trade sources have to meet minimum social and | | | | considered purchasing them, a relatively small |
| environmental criteria before being accepted for the | | | | proportion compared to other age groups. |
| Fair Trade certifying procedures. | | | | Relationship between age (years) and reasons for |
| Many Fair Trade products exist, such as handicrafts, | | | | not purchasing Fair Trade products |
| flowers and paper, but the main products are coffee, | | | | 16-25 26-40 41-55 56+ |
| bananas, tea and chocolate. In 2003, global sales of | | | | Unaware/not considering purchasing Fair Trade |
| Fair Trade products surpassed $700 million. In 2005, | | | | products 34% 27% 9% 31% |
| there were 433 producer groups globally working | | | | Against principle of Fair Trade 21% 11% 7% 36% |
| with 5 million farmers and their families, up from 360 | | | | Higher Cost 30% 18% 29% 11% |
| in 2002. Since 2001, export prices for coffee have | | | | Unavailability 35% 54% 86% 32% |
| dropped from $1.00 to $0.49c/lb, but Fair Trade | | | | Unclear labeling 5% 10% 11% 13% |
| coffee prices have remained at $1.26/lb, preventing | | | | Other 13% 11% 7% 9% |
| many small scale farmers from bankruptcy. | | | | Around 30% of 16-25 year olds did not consider |
| Nonetheless, Fair Trade has remained a niche market. | | | | purchasing Fair Trade products due to the expense |
| Consumers have the power to affect the growth of | | | | involved. It is likely that younger people generally |
| Fair Trade products. However, this is contingent on | | | | have less money to spend on food, linked to lower |
| their awareness of the inequalities of mainstream | | | | disposable incomes. This is probably particularly true |
| trade and the practices of supermarkets, so that | | | | of the many students who live and study in Kingston. |
| they choose, or not, whether to promote Fair Trade | | | | Consumers in the 56+ age group were most likely to |
| by paying a sort of ethical premium for Fair Trade | | | | be against the principle of Fair Trade and found |
| products. To better understand the current levels of | | | | labelling and information about Fair Trade unclear. |
| knowledge and awareness among consumers, an | | | | Perhaps the older generation are less willing to |
| original consumer survey was designed and carried | | | | change their patterns of consumption and less sure |
| out at one ‘up market’ supermarket | | | | about Fair Trade, as an alternative to conventional |
| (Waitrose) and one ‘down market’ | | | | trade which provides conventional products. Only 9% |
| supermarket (ASDA) in Kingston, south west London. | | | | of 41-55 years olds did not consider purchasing Fair |
| The survey focuses on food as an important sector | | | | Trade products, and 86% put this down to |
| of the Fair Trade market. | | | | unavailability. This implies that more aware consumers |
| ASDA and Waitrose target different socio-economic | | | | are more likely to see unavailability as the main |
| groups. According to a survey by Which magazine | | | | limitation to the growth of Fair Trade. |
| Waitrose is the leading supermarket chain in the UK in | | | | The proportion of consumers who were educated to |
| food quality and range. ASDA is ‘Britain’s | | | | degree level and aware of Fair Trade was 89%, |
| best value weekly shop with prices that are | | | | compared to 36% of consumers not educated to |
| independently shown to be lower than main | | | | degree level. Consumers educated to degree level |
| competitors’ and holds the title for Britain’s | | | | were also more than twice as likely to consider |
| best value retailer. While ASDA and other UK | | | | purchasing Fair Trade products (59% compared to |
| supermarket chains compete primarily on price and | | | | 24%). While 46% of consumers who were not |
| try to attract customers through rewards, loyalty | | | | educated to degree level were unaware/uninterested |
| schemes and cards, Waitrose tries to build up brand | | | | in Fair Trade products, only 10% of consumers |
| loyalty by offering differentiated, high quality | | | | educated to degree level were unaware of fair |
| products. Thus, Waitrose can be characterised as | | | | Trade and did not consider purchasing Fair Trade |
| ‘up market’ whereas ASDA can be | | | | products. Thus, a strong relationship exists between |
| characterised as ‘down market.’ Waitrose | | | | education and Fair Trade purchases. In order for Fair |
| holds a Royal Warrant for services, a prestigious | | | | Trade to grow into the mainstream, consumers must |
| symbol. It also has activities to maintain a | | | | make an informed decision to purchase Fair Trade |
| ‘green’ image. It was the first ever winner | | | | products, which means they must understand and |
| of the ‘Organic Supermarket of the Year’ | | | | support Fair Trade principles. Perhaps, consumers |
| title. Its products are also more exclusive than | | | | educated to degree level have a wider awareness of |
| ASDA’s, and tend to be more expensive. | | | | such issues. A higher proportion of consumers at |
| The objective of the survey was to obtain | | | | Waitrose were educated to degree level, 54% |
| information about consumer awareness and attitudes | | | | compared to 35% at ASDA. |
| towards Fair Trade and to compare Fair Trade | | | | Reverting back to the main hypothesis, the Kingston |
| potential between the two supermarkets (ASDA and | | | | survey finds that high awareness and demand for |
| Waitrose) in relation to consumer characteristics (age, | | | | Fair Trade products exists among consumers, which |
| gender, education) and product characteristics (price, | | | | implies a high level of support for the principles of Fair |
| availability, labelling). The findings were compared to | | | | Trade. However, unavailability and higher cost of |
| other UK consumer research. For example, the MORI | | | | these products are key limitations to growth of Fair |
| survey, May 2004, commissioned by the Fair Trade | | | | Trade. Consumer characteristics, including gender, |
| foundation, which found that recognition of the Fair | | | | age, and education, affect consumer awareness of |
| Trade mark was highest among women, 42% | | | | Fair Trade. Women tend to be more aware of Fair |
| compared to 35% of men, and in the 45-54 age | | | | Trade, as do consumers between 41-55 years and |
| group. | | | | those educated to Degree level. At ASDA, higher |
| Consumers entering both supermarkets were | | | | cost seems to be the main limitation to growth. Fair |
| presented with a structured questionnaire. Consumers | | | | Trade potential is higher at ‘up market’ |
| who did not intend to purchase foodstuffs were not | | | | supermarkets such as Waitrose. At Waitrose (and |
| included in the sample. Many consumers only wanted | | | | overall) higher cost was a secondary limitation to |
| a paper, cigarettes or other item not available as Fair | | | | unavailability. The MORI survey, May 2004, identified |
| Trade. The total number of consumers was 280 (140 | | | | that 63% of people who recognise the Fair Trade |
| at each supermarket). Interviews took place from | | | | Mark subsequently buy Fair Trade products and |
| February 23rd 2005 to March 1st 2005, every day of | | | | similarly, the Kingston survey shows 64% of |
| the week between 11am-12pm and 6-7pm, to ensure | | | | consumers who know about Fair Trade products |
| a better cross section of consumers. For example, | | | | consider purchasing them. This highlights the potential |
| sampling in the evening between 6pm and 7pm | | | | of Fair Trade and the importance of consumer |
| accomodated evening shoppers. The survey was also | | | | awareness. |
| piloted resulting in several improvements. | | | | One of the interesting findings of the survey was |
| It was hypothesised that: “Higher awareness and | | | | that consumers make a link between Fair Trade |
| demand for Fair Trade products exists among | | | | products and better taste and quality. There is |
| consumers. However, unavailability and higher cost of | | | | evidence of the ‘turn to quality’ in the food |
| these products are key limitations to growth of Fair | | | | business, where consumers are making informed |
| Trade.” | | | | purchases based on how they want food to be |
| The key findings of the survey are presented in the | | | | produced and supplied to them. The trend has been |
| graphs below. | | | | termed ‘green consumption’ where |
| It was found that 56% of consumers at ASDA were | | | | consumers seek foods that are produced outside the |
| aware of Fair Trade, compared to 64% at Waitrose. | | | | agro-industrial system responsible for food scares and |
| At ASDA, 32% of consumers were both aware of | | | | widespread environmental degradation. In the UK in |
| Fair Trade and considered purchasing Fair Trade | | | | particular, this ‘turn to quality’ has been |
| products, compared to 45% at Waitrose. A chi | | | | constructed around consumer concerns over health |
| squared test showed this difference was significant | | | | and food safety, which can be linked to a foot and |
| at the 5% level (v = 1). Thus, consumers at | | | | mouth epidemic, public anxiety over GM products and |
| Waitrose were more likely to purchase Fair Trade | | | | the BSE crisis. Consumers may also seek to boycott |
| products. | | | | food from particular multinationals or countries, or to |
| The main reasons for purchasing Fair Trade products | | | | consume only locally produced or organic food or |
| were fairer price for the producer (33%) and better | | | | animal welfare friendly meat, or become involved in |
| taste and quality (20%). For the majority of | | | | ‘community supported’ agriculture and these |
| consumers, both these reasons were important | | | | consumers are a driving force behind Fair Trade. Fair |
| (48%). This implies that consumers who consider | | | | Trade products, along with organic products and a |
| purchasing Fair Trade products are generally willing to | | | | range of natural foods, are perceived to be of better |
| pay a higher premium for Fair Trade products. | | | | quality and taste, which is increasing Fair Trade sales. |
| Interestingly, more than two thirds (68%) make a | | | | The survey may have reflected some confusion |
| link between Fair Trade products and better taste | | | | among ‘green’ consumers between organic |
| quality and a fifth (20%) said they considered | | | | and Fair Trade markets. Nevertheless, it can be |
| purchasing Fair Trade products solely for better taste | | | | argued that Fair Trade may be capitalising on the |
| quality. | | | | success of the organic market, and that the products |
| Fruit was the favoured Fair Trade product (58%), | | | | overlap. |
| followed by coffee (51%). The favourite fruit was | | | | Fair Trade is rapidly growing as a market, with |
| bananas; also the UK’s most popular fruit. Coffee | | | | powerful consumer support (as indicated by this |
| and fruit were by far the most popular Fair Trade | | | | survey and many others). In some countries, such as |
| products, also indicated by UK sales figure. Tea | | | | Switzerland, Fair Trade coffee has penetrated the |
| (12%) and chocolate (12%) were less popular. | | | | mainstream. The success of coffee could be |
| Relatively few consumers were interested in | | | | repeated for other products, including staple foods |
| vegetables (5%), juice (4%) and honey (1%). | | | | such as rice and potatoes. But Fair Trade is difficult |
| Unvailability is a main limitation to the growth of Fair | | | | to institutionalise, constrained by continuing policy |
| Trade, as suggested by nearly half (45%) of | | | | distortions in importing countries. These range from |
| consumers who did not consider purchasing such | | | | protectionist barriers on agricultural products (and a |
| products. Fair Trade products are limited to a handful | | | | range of other products), along with often |
| of foodstuffs in supermarkets. They are not available | | | | unnecessarily bureaucratic regulations, which |
| in meat, cheese, bread and ready meals, and a range | | | | discriminate against small scale producers in |
| of other foodstuffs. | | | | developing countries. |
| Reasons for not purchasing Fair Trade products by | | | | Some consumer studies in Europe have also shown |
| supermarket | | | | that, in general, only a maximum of 20% of people |
| % ASDA Waitrose Total | | | | would be willing to pay more for Fair Trade goods. A |
| Unavailability 21% 68% 45% | | | | huge majority of people would rather pay a lower |
| Higher Cost 40% 2% 21% | | | | price despite the negative social and environmental |
| Against Principle 18% 17% 18% | | | | consequences of doing so. Fair Trade is often |
| Unclear labeling 13% 2% 8% | | | | dismissed because of these limitations. It is also |
| Other 5% 13% 9% | | | | argued that Fair Trade is limited because it centres |
| At Waitrose, a higher proportion of consumers did | | | | on competing with conventional trade, and not |
| not intend to purchase Fair Trade products simply | | | | enough on tackling the root causes of poverty and |
| because of their unavailability, 68%, compared to | | | | unequal power relations in trade. TransFair USA |
| only 21% at ASDA. The range of Fair Trade products | | | | describes the benefits of Fair Trade as follows: |
| at each supermarket was similar, but more Fair Trade | | | | ‘In a global village, we prosper as our less |
| fruit was available at Waitrose. Perhaps linked to | | | | fortunate neighbours prosper. Nations become |
| higher awareness, consumers at Waitrose were | | | | neighbours, and we accept that some nations |
| more likely to realise the limitation of availability. At | | | | (‘neighbours’) are naturally more fortunate |
| ASDA, consumers were more deterred by higher | | | | than others. The causes underlying global inequality, |
| cost: 40% of the group identified higher cost as a | | | | such as imperialism, neo-imperialism, trade |
| reason for not considering Fair Trade products, | | | | advantages, and the debt crisis, disappear in this |
| compared to just 2% at Waitrose. Overall, | | | | quaint metaphor. The notion that natural resources |
| unavailability is the main limitation to the growth of | | | | are limited, and that the first world neighbours gobble |
| Fair Trade (45%) and higher cost a secondary | | | | up a disproportionate share of the global commons, is |
| limitation (21%). | | | | also implicitly accepted.’ |
| The findings give weight to the assumption that | | | | There are many limitations to Fair Trade, and it |
| Waitrose caters for higher socio-economic groups, | | | | cannot be seen as an answer to root causes of |
| who may be more aware of Fair Trade and who can | | | | poverty and inequality. At present Fair Trade is a |
| better afford such products. Waitrose consumers | | | | niche market. It only guarantees protection against |
| have a higher disposable income which allows then to | | | | unequal and competitive international markets to a |
| spend more money on food. Therefore, the potential | | | | minority of small-scale producers in Fair Trade |
| of Fair Trade to grow is higher at Waitrose. If there | | | | partnerships. However, I would argue that Fair Trade |
| were more Fair Trade products available, 40% of | | | | is part of a growing social movement, and one |
| consumers at ASDA would still not consider | | | | positive element of globalisation and, if growth |
| purchasing them because of higher cost, but at | | | | continues, Fair Trade will penetrate the mainstream |
| Waitrose, only 2% would still not consider purchasing | | | | market. |
| them due to higher cost. | | | | This article focuses on the role of consumers in |
| Nearly a fifth (18%) of consumers were against the | | | | mainstreaming Fair Trade. Consumers are creating |
| principle of Fair Trade and thus did not consider | | | | demand for more Fair Trade products, but for Fair |
| purchasing Fair Trade products, perhaps because | | | | Trade to become mainstream, economic, political and |
| they wer in favour of mainstream | | | | social factors need to work in tandem to make |
| ‘conventional’ trade, or completely | | | | governments get behind Fair Trade. Fair Trade is at |
| ‘free’ trade. Advocates of free trade argue | | | | present an individual subsidy, but it should signal |
| that it is unfair to establish a fair price because fewer | | | | pressure for public subsidies (for the environmental |
| producers can capture higher prices, whereas low | | | | and social cost of food production), so consumers |
| prices ensure that more producers benefit from being | | | | are less deterred by cost. Developed countries could |
| paid the lower wage (although demand for Fair Trade | | | | allow developing countries to subsidise their |
| products could grow so that more producers would | | | | producers; open up their markets to exports from |
| benefit from higher wages). It can also be argued | | | | the developing world; and dismantle their own |
| that trade could become fairer by being freer i.e. no | | | | protection. Oxfam calculates that if developing |
| government “interference” for efficient and | | | | countries increased their share of world exports by |
| socially optimal allocation of resources. Essentially, | | | | just 5% this would generate US$350 billion - seven |
| developed countries could remove domestic subsidies | | | | times as much as they receive in aid. |
| which protect their producers and force small scale | | | | A key challenge for the Fair Trade movement is in |
| producers in developing countries to compete on an | | | | educating consumers in developed countries. In fact, |
| unequal playing field. If World Bank estimates are | | | | about half of the extra price charged for Fair Trade |
| true, freer mutual trade would benefit developing | | | | products currently represents the cost of publicity |
| countries by $31bn a year. However, it has not been | | | | and education work in the consumer market. The Fair |
| in the political or economical interests of Western | | | | Trade banana is a case in point: it costs up to 40% |
| governments to make trade completely free (or fair). | | | | more than the “normal” banana. In other |
| Around 8% who did not consider purchasing Fair | | | | words, the consumer is paying a premium to inform |
| Trade products mentioned that information/labelling | | | | other consumers. If Fair Trade principles and |
| was unclear. Fair Trade products are labelled with the | | | | environment and development issues were debated |
| Fair Trade logo, which gives consumers a tool or | | | | in schools, colleges and universities, even as part of a |
| brand which they can recognise, along with the | | | | national curriculum, there would be great potential of |
| slogan ‘guarantees a better deal for third world | | | | Fair Trade to grow and challenge conventional free |
| producers.’ Thus, it is likely that this group of | | | | trade, linked to much higher awareness of the public |
| consumers were referring to unclear supermarket | | | | from a young age. |
| labelling rather than Fair Trade product labels. At | | | | Politically aware consumers can make ethical |
| ASDA, 13% of the group identified unclear labelling as | | | | purchases but also resist unfair trade practices |
| a reason they did not consider purchasing Fair Trade | | | | through citizen campaigns, pressuring governments |
| products, compared to only 2% at Waitrose. At | | | | and companies to improve the social and |
| ASDA, it was clear that ‘conventional’ | | | | environmental performance of trade. Non |
| products were prioritised over Fair Trade products. | | | | Government Organisations, collaborating with groups |
| There were many advertisements focusing on the | | | | of aware consumers can do more to place pressure |
| low prices of various conventional products, such as | | | | on transnational companies to participate directly in |
| bananas for 59 pence. It could be that the | | | | Fair Trade. For example, Starbucks was essentially |
| bombardment of consumers by such messages not | | | | compelled to start carrying Fair Trade labelled coffee |
| only appeals to their pockets, but also makes them | | | | by activists who picketed stockholder meetings and |
| less willing to find out about alternative production | | | | threatened mass demonstrations. Governments can |
| methods (i.e. Fair Trade products). | | | | be progressive at the national level, working with |
| In 2002, MORI asked people how they first became | | | | NGOs to develop Fair Trade. In Switzerland Fair |
| aware of the Fair Trade logo: 43% indicated that it | | | | Trade has been relatively successful because NGOs |
| was while shopping; 20% said features in | | | | have helped to educate the public, raise awareness |
| newspapers or magazines; and 14% cited word of | | | | about Fair Trade, and distribute products, with |
| mouth from family and friends. Therefore, because | | | | financial and technical support from the progressive |
| labelling is clearer at Waitrose, it is more likely that | | | | Swiss government. Linked to consumer awareness |
| consumers at Waitrose are aware of Fair Trade. | | | | and demand for Fair Trade products, companies have |
| The proportion of women who were aware of Fair | | | | realised the profitability of Fair Trade. |
| Trade was 69%, significantly higher than men (46%) | | | | The time has come for businesses and supermarkets |
| (chi-squared: 5%, v=1). As there were a higher | | | | to realise the profitability of Fair Trade, and follow in |
| proportion of women in the sample, it is probable | | | | the success and footsteps of other ‘social |
| that women spend more time shopping for food than | | | | enterprises’ such as the Body Shop and Ben & |
| men, and develop more knowledge about availability | | | | Jerry’s. Governments must regulate the |
| of products and, thus, are generally more aware of | | | | corporate sector so that Fair Trade is not exploited |
| Fair Trade than men. The findings are also supported | | | | for a niche market. Ironically, the time has come for |
| by the 2004 MORI survey, which showed that | | | | ethical corporations to take advantage in the food |
| recognition of the Fairtrade mark was higher among | | | | market, this time with a fair outcome. |
| women (42% compared with 35% of men). In the | | | | The findings of this study highlight the importance of |
| total sample, 40% of women were aware of Fair | | | | better understanding consumer preferences, and |
| Trade and considered purchasing Fair Trade products, | | | | raising awareness further, if Fair Trade is to continue |
| compared to 31% of men. Therefore, Fair Trade | | | | to grow into the mainstream. Consumers have and |
| potential is higher among women. Interestingly | | | | will play a key role in the growth of Fair Trade. Fair |
| though, 57% of women who were aware of Fair | | | | Trade is a market and a social movement that seeks |
| Trade considered purchasing Fair Trade products, | | | | to resist unfair trade practices. It operates both |
| whereas 67% of men who were aware of Fair | | | | ‘within and against the market.’ For this |
| Trade considered purchasing Fair Trade products. This | | | | reason, education and public awareness of trade |
| implies that men who are aware of Fair Trade are | | | | issues and the principles of Fair Trade will be |
| more likely to consider purchasing Fair Trade | | | | paramount to the growth of Fair Trade. |