# WhoCares Who Does Latam 2022 - ENG p
This is our fourth year of connecting consumer attitudes and actions to real shopping behaviour across all FMCG categories.
Introduction
The economic crisis puts the
brakes on sustainability but the
impact is different in each market
Welcome to the Latam edition
of the 2022 Who Cares? Who Does? study
This is our fourth year of connecting consumer attitudes and actions to real shopping behaviour across all FMCG categories.
When it comes to sustainability, there is a difference between what people say and what they do. It’s easy to say you care but more difficult sometimes to change behaviour. Latam’s current economic challenges can make it harder, particularly when the more environmental choice can be more expensive.
While the previous trend was broadly upwards in terms of growing the proportion of the population that believed they could make a difference, this year has seen a slight reverse in attitudes thanks in part to economic and social circumstances.
As ever however, there is no simple picture for Latam, there is only granular differences that together combine to make an overall statistic. Understanding that is key to knowing how to be part of the successful wave of sustainability aware brands that building both value and share across the region.
There is certainly an opportunity for FMCG brands and despite the fall in the proportion of Eco-Actives in 2022, nearly half of the FMCG purchases made in the region by value are still being made by consumers who consider or actively make decisions based on sustainability criteria.
Brands need to deliver on key criteria that will appeal to this vital segment of the population.
Who Cares? Who Does? 2022
Who Cares, Who Does is a globally harmonised survey of 24 countries and 99,000 respondents – designed to help brands understand how to gain a competitive advantage from sustainability.
By linking attitudes to real purchase behaviour, it’s possible to see what was actually bought by those that say they care and to understand the relationship between these people and your brand.
In 2022 we extended our coverage to Argentina as part of the 15,214 surveys across the region.
- COLOMBIA – 1120
- ARGENTINA – 921
- PERU – 2990
- CAM (PANAMA/ COSTA RICA / GUATEMALA) – 834
- CHILE – 961
- ECUADOR – 601
- MEXICO – 4145
- BRAZIL – 3642
Social attitudes change
Global warming is becoming a major
issue for consumers, equalling previous
concerns about water quality for
the first time
Conscious and adapting society
Environmental concerns have always changed as societies evolves and economic pressures wax and wane. Latam is no exception. Across the region for the first time, climate change and global warming are felt to be equal in importance to the issues around water quality that have dominated the regional results for Who Cares? Who Does? in recent years.
This has been a gradual rise and water continues to be a big issue in 2022, but the fact that Global Warming is joint No. 1 in 2022 demonstrates how seriously consumers are now taking climate change.
We are also seeing legislative action and change on environmental issues across the region. The flagship measure this year has been Colombia’s decision to ban single use plastics, matching commitments already made by Brazil, Chile, Mexico and Peru.
Such measures matter because consumers are increasingly looking to government and industry to take action when it comes to delivering a more sustainable world.
In 2022 the proportion of consumers who think Government and manufacturers could make the biggest difference in controlling and limiting environmental damage hit 30% and 37% respectively, up from 28% and 35% in 2021.
The economy matters
For most consumers, however, the biggest challenge in translating values into action remains the economy and their own sense of financial wellbeing. With inflation on the rise and the threat of a global recession looming, 48% of all Latinos agree that it is now more difficult to act sustainably in their everyday lives.
The impact of economic factors can be seen that just 30% of the jobs created in the region since 2020 are now in the formal economy. The rest, in the informal economy, come with wages that are on average 25% lower.
Finding the right balance
Eco-Actives and Eco-Considers still
account for nearly half of total spend
on FMCG
Compromising with
the planet
The impact of the economic challenge is clearly seen in terms of the proportion of Eco-Actives, Eco-Considerers and Eco-Dismissers. In 2022 the proportion of the first two groups declined so that Eco-Dismissers were in the majority (53%) in the region for the first time since 2019. The good part is that it is still above pre-pandemic levels.
This compares with a global breakdown that had just 44% of the population as Eco-Dismissers, although that percentage is also up compared to 2020 and 2021 when it was just 37%.
Nevertheless, combined the Eco-Actives and Eco-Considerers (47%) of the region constitute a sizeable market opportunity.
The picture is not uniform, of course, and while the decline is more notable in Brazil in Mexico, eco-positivity is still significant in many markets, notably Colombia where Eco-Actives and Eco-Considerers have both grown in 2022. Eco-minded groups are also in the majority in Argentina, Chile, Central America and Mexico.
As you would expect, movement between the different groups tends to be gradual, with Eco-Dismissers becoming Eco-Considerers before they become Eco-Actives and visa-versa, rather than moving dramatically between the extremes in large numbers.
Only 8% of Eco-Dismissers totally directly to the other extreme of the Eco-Actives. On the other hand, 30% of Eco-Actives do make an abrupt decisions, although a higher percentage of shoppers follow a more gradual path.
That’s why targeting Eco-Considerers as well as Eco-Actives should be considered as an effective way to engage more people and reach more of your consumers
Who are Latin America’s Eco-Actives
This most committed group has also altered profile considerably this year. They are more likely to be over 50 and more likely to live in medium-sized households (3-4 people), rising from 42% in 2021 to 50% in 2022. Notably even the number of high-income individuals has dropped, as has the number of smaller households.
The good news for all brands looking for a large audience to target is that the issues that concern Eco-Actives are increasingly the same as those that worry Eco-Considerers. Asked to name the most important UN Sustainable Development Goals, both scored clean water and sanitation highly, although Considerers put quality education even higher.
People still want to make a difference
For all the economic hardship, people’s willingness to make a difference remains strong. Making a difference is not just about money but also about time – researching alternative products for example, as well.
Sixty-one percent – rising to 71% in Central America – feel like they can make a difference through their actions. This compares to 39% – 54% in Colombia – who say they are willing to invest time and money to support companies doing good.
But many are sceptical about the motives of those who make the products and services they need. While Latam consumers are slightly less sceptical than the global average, 50% agree with the statement that companies only care about profits and green claims are just another marketing tool (53% globally). The figure rises higher among Eco-Actives in Latam (59%), Peru (62%) and Chile (65%).
One of the most direct actions available to consumers is around packaging and it demonstrates the stronger motivations and willingness to change among both Eco-Actives and Eco-Considerers.
Products that are packaged in an eco-friendly way and packaging made from recycled materials attract a majority of all respondents but people who are more willing to change behaviour pull the index up.
Brands that lead by example
The best performing sector regarding sales performance and value to the cause is the Hygiene and Beauty sector – named by 30% of respondents – for its actions in balancing the performance and value equation that is critical to uptake of more sustainable products.
In Latam, L’Oréal, for example, indexes 128 against Eco-Actives thanks to its efforts on water, waste management and recycled packaging combined with clear commitments and communication on its plans for 2030.
Right target,
right product
The correct message can help
deliver both growth and change
in behaviour
The truth is that most people want to do the right thing. The reality is that only a quarter manage to do so.
Across the region, for example, 58% try to buy environmentally friendly packaging – peaking at 64% in Central America – but only 22% manage to do so (Central America is, again, ahead of the pack at 26%).
The values action gap is large but there are sectors where people do manage to take action. Forty-two per cent across the region – falling to 26% in Brazil but rising to 57% in Peru frequently buy locally produced meant, fish, fruit or vegetables. This compares with 44% globally and 63% in Asia.
Moving to a more plant-based diet will be more challenging in meat-eating Latam but we do find that consumers in Ecuador and Peru frequently buy plant-based products, with Argentina, Brazil and Chile at the other end of the spectrum.
There’s a more positive story in Personal Care and Household, where 26% of consumers across the region are actively looking for products with natural ingredients and 26% across the region are looking for household products with fewer harsh chemicals.
Across all these categories, the reasons given for purchase decisions are less to do with the core performance of the product or better quality, for example, but for reasons of health or supporting local farmers.
Three things you should do now
Eco-Actives will rise again and
brands should hold firm to their values
The data for 2022 may be disappointing for those who believe in the power of consumers to drive change on environmental issues. Nevertheless, we believe there’s no reason why brands should abandon their goals to make products and services less damaging for the planet and society.
First, we believe that this is a phase, driven by economics rather than by changing values. Brands should continue to identify their sustainability objectives and the ways in which they make consumers’ lives easier and/or better. The pressure to make changes will only increase and the value action gap is likely to shrink in the future.
Second, we believe that the environmentally aware consumer still represents a significant market segment. If you match your values to those of both Eco-Actives and Eco-Considerers then you have a chance to win nearly half the market today and, hopefully, a lot more in 2023 and beyond.
Third, Innovation and performance matter. These can be focused around what is core to your business/matches your brand purpose or around enhanced performance for consumers that makes the sustainable choices a better option.
There is a huge market to play for in Latam. Nearly half of all FMCG expenditure is spent by consumers who say they think about the environment and want to make the right choices. Brands need to find a way to connect with them.
Food for thought
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