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HowGood Shelf Tags Measure Sustainability
To better inform shoppers, 20 independent retailers have implemented the third-party HowGood rating system that tells customers just how sustainable or “how good” a product is.
Jenna Telesca
November 19, 2013
4 Min Read
BROOKLYN, N.Y. — Green is good, consumers say. At least on surveys, shoppers indicate that they want to support companies with sustainable practices.
One foil for consumers is that aside from meat and seafood department sustainability programs, there hasn’t been an easy way for them to know much about the companies they are buying from.
To better inform shoppers, 20 independent retailers have implemented the third-party HowGood rating system that tells customers just how sustainable or “how good” a product is.
“The premise is the idea of empowering shoppers to vote with their dollars, and it’s quite a different approach from the way that things had been done in the past — where the only kind of rating systems out there are health rating systems,” said Alexander Gillett, CEO of HowGood.
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Foodcellar & Co., based in Queens, announced on Twitter last week it had recently implemented the rating system, joining other independents like “clean foods” focused Roots Market in Maryland and the Greene Grape in Brooklyn that has offerings centered around sustainability, freshness and local sourcing.
The 100,000 products rated by the HowGood system can receive four different shelf tags: None, Good, Very Good and Great. These ratings are also represented with an image of “globes” with a Great product showing three globes and a None product unsurprisingly showing zero globes.
The sustainability rating system is built around the social and environmental impact of producing a particular product — using 60 to 70 different factors.
“And those [indicators] range from the type of pesticides that they use, the water usage to the social side of things — whether they’re equal opportunity employers, things like that,” said Gillett.
The 100,000 products rated by HowGood can receive one of four shelf tags: None, Good, Very Good and Great.
HowGood spent years putting together the database of products.
“We create a benchmark for an industry, what the standard impacts are of that both on an environmental and a social scale, and then we look for ways a company performs above and below those standards that are established and sufficiently verified,” said Gillett.
He explained that experts, from scientists to farmers, develop the benchmark. The experts try to account for scenarios when sustainable efforts aren’t marketable. Gillett gave the example of producers who process methane can’t really convey the benefit on a carton of milk.
In addition to the company’s own research, HowGood partners with groups like the Marine Stewardship Council, known for its certification program, to utilize their product data.
All products in the HowGood database are given “cursory” reviews every six months and “thorough” reviews each year, said Gillett. HowGood also has a continuous automatic review process where researchers are prompted to look into products if a red flag comes up in online articles, such as a labor issue.
In addition to promoting sustainable producers, the rating system can benefit retailers when they call out their sustainable offerings, according to Gillett.
Read more: General Mills Wins Supplier Leadership Award for Sustainability
“But it also increases their basket size because on average the product that gets a higher sustainable score, costs more.”
On average, retailers see a 27% jump on sales on the higher-rated products, he said.
On top of shelf tags, customers can get more information about an individual product’s ratings online and in stores that opt for HowGood kiosks.
For example, the database shows that Vermont Creamery Cultured Butter received three globes for a “great” rating with several summaries that explain that the product is sourced from small farms with minimal processing using fair labor practices.
The HowGood ratings opt to reward the most sustainable suppliers.
Read more: SN's continuing sustainability coverage
“It’s a positive-only rating system. We tested a lot of different ways of displaying the information from negative to positive to purely showing the positive in grocery stores and we found the impact on customers was the best when it was positive only. So we highlight the ones that are above average.”
When asked whether it was difficult to summarize 60 to 70 factors into four different categories, Gillett said HowGood wants to convey the bigger picture about a company.
“Are they purely bottom-line focused or are these also companies that are looking to have beneficial impacts in terms of the communities they are a part of and in terms of the environmental impacts?”
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