Put a label on it!

A study conducted by the German Federal Institute for Risk Assessment shows that the origins of the label boom can be traced back to the 80s and 90s and the age of rebellious alternative and environmental movements that would later become green parties.

It also revealed that there were more quality seals in Germany than anyone else. And the curve is even steeper in the food sector. There are now more than 1,000 product labels  and designations such as eco certificates, as well as just about every kind of quality seal imaginable. And that’s the crux of the issue: so many seals, but so little clarity . Although some labels are legally required – such as the CE symbol which denotes conformity with EU standards, as well as giving information on recycling and proper disposal – a lot of them seem to be added almost arbitrarily. Some of these labels are regulated by public authorities, and others by private organisations and institutes. But then there are also some that hit the shelves without any proper checks at all.

Owing to the lax regulatory framework, there are too many labels in circulation, sowing confusion and potentially leading consumers up the garden path. One study showed that a fictitious seal was identified more frequently than existing labels in all of the categories examined (F&B, beauty and textiles). The comparison was made using known brands.

Even the most well-informed consumer can easily be misled, given the bewildering array of labels.

The problem is that manufacturers can self-certify.  Each certificate is based on different standards that are nigh on impossible for consumers to check. Especially when they are doing their weekly shop and are pushed for time. More quality seals equals more information about products? These labels are supposed to help customers navigate the consumer jungle. But while we now have greater access to information about various products, the level of confusion has risen too.
The bottom line is that new labels are added every year. However, the focus should be on raising awareness of existing, certified labels to give consumers a benchmark to go by. In many cases, people’s shopping habits are governed by positive and negative emotions, and the notion of having a clear or guilty conscience. One study found that the majority of respondents still thought organic chocolate was appropriately priced if it cost as much as 42% more than a premium product without a seal.

This confirms a clear trend: according to the AMA Austria consumer tracking household panel, the proportion of organic foodstuffs increased in virtually every product category in Austria in the first half of 2020. And the share of the average shopping basket accounted for by organic products was up by 14.4% in volume terms on the same period a year earlier, and by a fifth in terms of value.  In June, the proportion of organic products in the nation’s shopping baskets hit double digits for the first time. So it hardly comes as a surprise that the individual labels are vying for attention in the organic segment, and new ones are being added every year.

A label for every industry

The coronavirus pandemic has helped to speed up the transformation in consumer behaviour. You could say that a green wave is heading in our direction. Three trends have emerged above all others during the pandemic and the resulting lockdown: “bio”, “eco” and “local”.

Supporting Austrian and local growers and producers has been the primary motivation for many consumers during the pandemic. And this is increasingly reflected in their buying habits. There is also an growing tendency towards buying from domestic online retailers. Climate protection and sustainability considerations are increasingly informing people’s shopping preferences. But this also exposes consumers to greenwashing – even though use of the terms “bio” and “eco” is protected by law throughout Europe , the same cannot be said for words like “regional” and  “climate friendly”. And let’s be honest, there’s probably not one of us who hasn’t mixed up these terms at some point or treated them as interchangeable. So whether its organic, regional or eco, who really knows what’s what?

Labels can simply signal that something is “bio” or “regional” without having to explain what’s really behind it all.  The European “bio” label is, in fact, the lowest threshold for organic produce. In Germany, this particular seal is applied to more than 80,000 products – and the number is rising all the time. And sales of “bio” foodstuffs have doubled over the past ten years, to around EUR 10 billion!

The crazy thing is that consumers often lose sight of what it was that they were trying to achieve in the first place. Whether it’s sustainability goals, or the desire to support domestic producers, these flashy labels can prove pretty distracting, given that in many ways it actually would make more sense to buy directly from the farm gate. While you won’t find any labels there, you can be absolutely certain where the product came from.

So what can we do to clarify things?

There are now a number of apps that help to inform consumers and provide an overview – but using them is time consuming. Users can scan the product barcode to find out what it contains, and details of any certifications. But it all takes time and not every app has every product. Still, it’s a start.

Ideally, people should exercise a little more caution when it comes to labels and think more about what it is they want their shopping choices to achieve. Not every product needs a quality seal to tell the world what it’s made of.