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What can America learn from the UK retail sector?

The US retail sector has already adopted a number of new initiatives from its UK counterpart, including the continuing prominence of private label products, development of ‘free from’, and a focus on heightened transparency when it comes to product marketing. However, the past 12 months has also seen a number of major pledges from various CEOs across the pond, making significant promises that are already beginning to shape the new face of British retail.

The use of plastics has been high on the agenda in British politics for some time, with the plastic carrier bag charge rolling out in 2015. This required stores to charge 5 pence for all single-use plastic carrier bags, paving the way for retailers to do more to address this impending crisis. While this intervention has already seen a significant reduction (83 per cent) in the use of plastic bags, it’s clear that more needs to be done. At the end of 2015, more than 6.3 billion tons of plastic waste had been generated globally, with around 80 per cent of this going into landfill or the natural environment.

Competing on environmental credentials has been an area of particular focus over the past few months in the UK, attracting plaudits from both media commentators and eco-conscious consumers in the process. Evidence also suggests that customers are now thinking more about the amount of plastic used in packaging and its lasting impact, and as a result, European-based frozen food retailer Iceland announced it was to eliminate plastic packaging across all of its private label products by 2023.

Iceland has already removed plastic straws from its private label range, with new food ranges being introduced in the coming months that will use only paper-based trays. Of course, the announcement will please customers, with the heightened green approach almost guaranteed to deliver a welcome boost to the supermarket’s reputation. It has since revealed it is also to ban palm oil in its range of private label products – a move that has cemented its position as a green leader within the sector.

It will be interesting to see how and if these recent announcements will be replicated in the United States. With increasing competition, particularly with the rising prominence of retailers Aldi and Lidl, it’s clear that major US retailers have some road to travel to catch up with the UK and wider Europe.

However, for certain products, plastic (and other less eco-friendly materials for that matter) is a preferred option when it comes to packaging, to protect vulnerable items from contamination and damage during transit. By being transparent with consumers, brand equity will only rise by working closer with suppliers to develop innovative and environmentally friendly products. Put simply, assuring quality is maintained from both a manufacturing and ethical perspective will only benefit retailers.

With consumers now able to interact with brands across a range of platforms, the demands for product information, including the details of origin and manufacturing process, has never been higher. The answers to these questions will not necessarily be available on the packaging specifically, but brands must make a conscious effort to ensure this information is readily available online and on smart phones if a customer should need it. If a consumer is unable to locate these key details, a brand might be questioned into whether it’s hiding something, it’s all about being as transparent as possible.

The US has already begun to take great steps to address this with new measures such as SmartLabel, which allows customers to scan QR codes on the shelves within stores to gain instant access to product information. With competition across the retail sector increasing all the time, it’s important that brands continue to invest in such initiatives, in order to attract customers that are more conscious about the environmental and/or the nutritional credentials of what they’re actually eating.

Now is the time for US retailers to be bold and reap the rewards. Those that are prepared to be brave - and honest - about the information they provide to customers will be the ones that soon rise to the top.  

Kieran Forsey

kieran.forsey@s4rb.com

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