Product Development – On the Internet of “Things”
Can your data be ethical?
As more and more products are evolving from how we manage information and data – there has been growth in products in the ethical market . It has served to drive sales of ethical goods and services, which are often more expensive than non-ethically produced products. According to preliminary economic estimates published by National Statistics, gross domestic product (GDP) was 3% higher in Q3 2014 compared with a year ago, while wage growth outstripped inflation for the first time in 5 years during November 2014, after rising by 1.3% in the third quarter of the year — 0.1 percent points higher than consumer price inflation during the same quarter.
- Rainforest Alliance products have also continued to increase as a result of a growing availability within the UK, with sales of Rainforest Alliance-certified food products estimated to have risen by 47% during 2013.
- Public scandals, such as the horsemeat debacle, as well as a growing mistrust of core bank brands following the LIBOR (London InterBank Offered Rate) scandal, the payment protection insurance (PPI) miss-selling calumny and growing outrage regarding banker bonuses following the recession, along with increased demand for transparency among big businesses, have resulted in the emergence of a much more ethically and environmentally informed consumer.
- Sales of organic products have observed resurgence in recent years, following growing consumer demand for transparent product provenance in the light of the horsemeat scandal, as well as more flexible household budgets in line with the economic recovery.
- Spending on micro-generation (i.e. household renewable energy systems) has increased by 50%, following the introduction of generous Government incentives, such as the Green Deal home improvement scheme and a sharp increase in solar power home installations during 2014.
- Demand for green cars, which offer low-carbon emissions, has increased in recent years, driven by a revival in the new car market, as well as significant new product development (NPD) by several well-known car brands, such as Nissan, Toyota, Vauxhall and Renault, with the electric car market showing record growth of 143.9% up to the end of June 2014, according to figures compiled by the Society of Motor Manufacturers and Traders (SMMT).
- The diversification and expansion of Fairtrade schemes to new product sectors, such as jewellery (in particular gold) has also helped to drive sales of ethical products in recent years, while other market sectors, such as eggs, coffee and bananas are increasingly dominated by ethical products.
- In recent years, micro-generation (i.e. the generation of electricity or heat of a small-scale, typically for domestic or household use by methods that do not contribute to the depletion of national resources) has continued to increase, with National Grid Energy estimating micro-generation to have risen by 0.5 gigawatts (GW) during the past 3 years. Spending on micro-generation has also increased significantly across UK households, with Ethical Consumer magazine estimating expenditure on domestic renewable energy platforms to have risen by 50% during 2013 alone.
- One of the most significant driving factors behind the trend towards more energy-efficient homes has been the UK Government’s Green Deal, which was first launched in January 2013, and offers long-term loans to homeowners to help them make energy-saving improvements to their home, such as the installation of insulation, draught-proofing and double glazing, or renewable energy systems, such as solar panels or heat pumps.
- Other Government initiatives introduced with the aim of reducing domestic energy use in the UK include the roll out of smart meters, which allow users to more accurately monitor their energy usage and expenditure; and the Electricity and Gas (Energy Companies Obligation) Order 2012, which was introduced in 2012 and provides funding of around £1.3bn each year to support the installation of energy efficiency measures in low-income households and areas.
- Industry analysts believe solar electricity could be cost competitive with gas by 2020, and estimate that around 10 million homes in the UK will need to install panels on their roofs over the next 6 years, if the country is to fulfil its renewable energy potential. If this aim was achieved, it would mean that a third of households in the UK would be generating energy from the sun, allowing the UK to produce around 6% of its annual electricity needs from solar power, with as much as 40% of energy being generated by such panels on sunny days during the summer, by the year 2020.
- The drive towards energy-efficient homes is also thought to be having a knock-on effect within the property market, with research undertaken by Knight Frank, in 2014, revealing that houses which have a high Energy Performance Certificate (EPC) rating are now selling more quickly than they did in 2010.
Electric and low-emission vehicles have continued to gain popularity in recent years, following ongoing Government investment into charge points, as well as NPD from leading car brands. The latest statistics published by the SMMT show that 9,955 alternatively fuelled vehicles (AFVs) were registered in September 2014, representing a 56% rise on the number registered for the same time last year.