An independent global research released today by TÜV SÜD, one of the world’s leading providers of safety, quality and sustainability solutions, has found that businesses should leverage on escalating consumer demand and willingness to pay to increase product safety with a positive impact on their businesses. The study, titled TÜV SÜD Safety Gauge, suggests that enhancing product safety should not only improve consumer wellbeing but also drive commercial success. The research investigates product safety practices alongside consumer attitudes and experiences in Children’s Products, Consumer Electronics, Food and Footwear sectors. This is the second installment of the research which was first conducted in 2012.
Growing disparity between consumer and business perception on product safety
The TÜV SÜD Safety Gauge indicates that concerns from consumers around product safety is mounting, with almost two thirds (60 per cent) of those surveyed stating that product safety is very important to them now, up from half (47 per cent) in 2007. This sentiment is expected to increase to 65 per cent by 2021. Despite escalating importance of product safety in the eyes of consumers, the business community has reported that enough has been done. On average, there is a noticeable decrease in industry-wide product safety concern as compared to 2012. A quarter (25 per cent) of companies believed that product safety is a significant issue within their industry today as compared to half (47 per cent) in 2012.
Consumers’ concerns centered on physical and chemical safety attributes
Despite business community’s growing confidence in product safety, consumers are still experiencing product safety issues. Around two in three consumers surveyed reported that they had experienced a product safety issue in the last five years. The most common product safety issues reported are allergic reaction (28 per cent), cut from sharp edge of products (27 per cent) and injuries as a result of poor product designs (20 per cent). The findings also revealed that consumers’ concerns around product safety are largely related to chemical safety, material / ingredients type and compliance with product standards. Chemical safety, in particular, has surfaced as an additional area of concern for Children’s Products, Food and Footwear. Interestingly, concerns pertaining to cyber security did not appear as a top ranked concern in any of the segments researched.
Ishan Palit, Chief Executive Officer of TÜV SÜD Product Service Division, said, “The results revealed an apparent gap between industry awareness and consumer concerns. The likely reason why consumer concerns today are centered on attributes related to physical and chemical safety is because these are predominantly the issues headlining product recalls. This is a clear signal to businesses that physical and chemical risks associated with products are still top-of-mind consumer concerns today.”
Further optimization of product safety efficiencies
On average, the cost required to achieve exemplary safety standards are perceived to have declined. The most apparent decrease was found in India in which the mean increase in production costs has fallen by 12 per cent between 2012 (22 per cent) and 2016 (10 per cent). The top three reasons cited by businesses to justify the investments in product safety are customers’ willingness to pay, global market access and company leadership in the segment.
The majority of consumers has indicated that they were willing to pay a premium for products that achieve exemplary safety standards, as verified by a credible independent third party. The aggregate proportion of consumers willing to pay a premium was the greatest in India (94 per cent) followed by China (93 per cent). This willingness to pay was also observed in the U.S. (75 per cent) and Germany (71 per cent). The results, analysed by segment, was equally optimistic. The highest aggregate proportion of consumers is willing to pay a premium for Children’s Products (90 per cent) followed by Consumer Electronics (87 per cent).
In response to this trend, Ishan Palit commented, “The findings send a very positive message to the business community to further optimize the cost efficiencies which they are drawing from product safety. Businesses are now able to justify further investments in product safety as high product safety levels will not only enhance consumer wellbeing but add genuine value to products.”
The research was undertaken in the top-tier cities across China, Germany, India and the United States – markets that represent almost half (47 per cent) of the global Gross Domestic Product. The results are based on more than 7,000 completed consumer surveys and 600 interviews of management-level executives that operate in the Children’s Products, Consumer Electronics, Food and Footwear industries. To obtain the full report with all key findings, visit: www.tuv-sud.com/safetygauge.
Report download: www.tuv-sud.com/safetygauge
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