HOLLYWOOD, Fla. — Paul Rice, founder and CEO of Fair Trade USA, took the stage at the Global Organic Produce Expo 2023, Jan. 31, but soon stepped down to walk among the enthusiastic audience that had gathered to hear his keynote presentation: “The Rise of the Conscious Consumer.”
“It’s good to be together and to have a chance to share stories, reconnect with old friends and make new friends,” Rice said. Given the theme of GOPEX — Reaching the Conscious Consumer — the fair trade pioneer’s intimate and conversational style struck the perfect keynote.
Rice, who has worked to further the fair trade movement for the last 32 years, said, “We really see the consumer as an integral part of our lives and our theory of change. We work with growers and farmers and workers. We work with the industry, but we also see the consumer as kind of a third leg of a three-legged stool. It's a key part of how we see the market moving and developing.
“We spend a lot of time thinking about how to reach the consumer,” he continued. “We spend a lot of time trying to activate the consumer to support companies and growers that are doing great things.”
But whether businesses are trying to better the world through organic farming or fair trade, how are these efforts perceived by the consumer?
“How many of us here in this room are skeptical about consumers and whether they care about what we're doing?” Rice asked the audience. “It would be perfectly reasonable for us to have doubts.”
While organic has been in the U.S. for decades, it still only represents 8% of market share, Rice said.
“But here's the good news … More and more consumers are asking what's in the products they are buying. They're reading the label,” Rice said. “They're getting educated about the attributes of the products. And it's not everyone, and it's not all the time. But if you look at the numbers, and if you look at the market trend, there's clearly what we think is a macrotrend — not a fad, but a macrotrend — a long, slow, but irrefutable trajectory toward a consumer that is more conscious about her choices, and more engaged.”
Most of the data suggests there are at least 100 million people in the U.S. — almost half of all adult shoppers in the country — that are looking for more responsible, sustainable or healthier products, Rice said.
Expressions of conscious consumerism appear in a multitude of movements including organic, fair trade, non-GMO, buy local, plant-based, cruelty-free, animal welfare, sustainable forestry, sustainable fisheries, regenerative and climate-friendly agriculture.
These movements are expressions of kindness and wisdom, Rice said, but they can also be about profitability.
Finding fair trade
Rice shared his journey to fair trade, which began with the purchase of a one-way ticket to Nicaragua at the age of 22. There, he went to work with farmers.
“Over time I started to feel really disappointed and disillusioned with this kind of top-down model of international aid,” Rice said. “We weren't really helping farmers develop their own capacity — to solve their own problems. I think, more often than not, we were creating dependency on foreign aid.”
In Nicaragua, Rice’s first fair trade victory was working with 24 small coffee farmers to get $1 a pound for beans that had previously commanded just 10 cents a pound. Four years later, he was working with 3,000 families on fair trade coffee.
Rice also helped to launch the first organic certification program for farmers living in the mountains of Nicaragua.
“And we did extraordinary things with the extra money that we got from selling to these different markets,” Rice said.
Extraordinary things like helping farmers stay on their land and work it, feeding communities three meals a day, keeping kids in school, establishing banking programs directed at women entrepreneurs, and bringing clean drinking water into villages for the first time.
“You know the No. 1 cause of death to children under the age of 5, in so much of the developing world, is gastrointestinal diseases caused by dirty water,” Rice said. “So, you clean up the water; you save lives. We were saving lives.”
These vast improvements were made without charity, government or international aid.
“It was all just thanks to this simple concept of a fair price for a great product,” Rice said.
There were “invisible dividends” as well, like the self-confidence and pride that the Nicaraguan farmers experienced when solving their own problems.
“We were helping farmers become architects of their own future, and that was so exciting,” he said. “It changed my life.”
Fair Trade USA
At 33, Rice returned to the U.S. to grow the fair trade movement in this country.
Rice explained that fair trade sets compliance criteria to address labor, social and environmental issues. While fair trade doesn’t require organics, it does require integrated pest management and forbids toxic agrochemicals, he said. And Fair Trade USA offers a premium as an incentive for farmers to go organic. About 70% of fair trade farmers are organic, Rice said.
“One of the hallmarks of the fair trade model is the premium,” he said. “We're one of the few models out there that actually requires a set premium, which we all have that's paid either by the brand or the retailer back to the farm. So, it's not a marketplace. It's a set premium per pound.”
With coffee, the premium is 20 cents per pound. With bananas, it’s 2 cents a pound. Each product has a premium, and that premium goes back to the farmer. In the case of larger farms or factories, the workers vote on how to spend the premium based on their most pressing needs, such as water and housing.
In the first 19 years, these premiums generated a half-billion dollars that went back to workers and farmers. In the next five years, that figured doubled to $1 billion.
“So, we're on a path. We're on a trajectory,” said Rice. “And that's because of conscious businesses and conscious retailers.”
Consumer awareness at retail
In the last 25 years, fair trade has enlisted more than 1,500 brands and retailers in the U.S. This includes 60 different fresh produce items, Rice said. Fair trade works with approximately 1 million growers in 50 to 60 countries around the world.
On the retail side, Fair Trade USA is working with Walmart, Kroger, Costco, Sam's Club and more.
“It's really interesting to see the mainstreaming [of fair trade],” said Rice, adding that it’s similar to the growth in organics.
“We have consumer awareness. Our label is growing year over year, and we spend a lot of time and effort thinking about how to do that in partnership with our brand partners and retailers,” he said.
Last year, 66% of American consumers said they recognize the fair trade label, and about 40% of them are buying certified products now on either a regular or occasional basis, said Rice.
Research finds that 80% of consumers say they want more sustainable products, he said. Seventy-five percent say that they consider sustainability and responsibility when they're shopping. Additionally, 70% of consumers say they would change brands to choose a more responsible or sustainable product. And 70% of consumers also say they would pay a little bit more for a product that is healthier and more sustainable.
When it comes to reaching the conscious consumer, quality matters and price matters, Rice said. And the products have to be accessible and available in mainstream retail like Walmart, Target and Kroger.
Fair Trade USA is currently doing a pilot with Kroger on fair trade tomatoes.
“We have great in- store displays,” Rice said. It is also partnering with Walmart on fair trade tomatoes.
But while consumers increasingly recognize certified organic and fair trade symbols, those symbols aren’t effective storytelling, Rice said.
“They're very two-dimensional. People may know what they mean, but it's not intimate. It's not emotional. It's not engaging.
“And so right now we're investing deeply in technology,” Rice continued. “We believe that in the not-so-distant future, fair trade needs to be able to deliver a rich data set to the industry and rich content to the consumer, so that retailers can hold up a dashboard and see their progress and see how they're doing on compliance with the standard and see how they're going to have an impact on where they're spending the money.”
On the consumer side, Rice envisions QR codes that connect the shopper with farmers and workers.
“I believe history is on our side. We have a better product. We have a more sustainable, responsible product that's healthier to eat,” Rice said. “We have a better story.”