Brands can bring their CSR efforts to life through authentic storytelling. I don't want to support companies that don't care about how the animals and/or workers are treated, and I do want to support those that do. Our own 2019 report, " The State of Consumer Spending: Gen Z . As a result, many consumers have adopted more sustainable behaviors. Already in 2015, a Nielsen report found that 73 percent of the Millennial generation was willing to pay more for sustainable goods. Notably, those two companies are doing so despite the strident objections of investors who criticized Indra Nooyi and Paul Polman, the former CEOs of PepsiCo and Unilever, respectively, for moving away from their traditional brands. We assessed third-party certification, such as USDA organic and Fair Trade, and the packagings claims about undesirable traits (such as genetically modified, BPA, parabens, antibiotics, growth hormones) and positive characteristics (local, grass-fed, compostable, animal crueltyfree). Some more takeaways on consumer habits: More than 8 in 10 recycle and replace lightbulbs with energy-efficient options. That said, some of those categories saw high growth in sustainability-marketed products sanitary napkins and laundry care were among the highest, at 150%. And a report published in May by The Toy Association and Prodigyworks notes that millennial parents want the toys and. This page does not exist in [x], feel free to read the page you are currently on or go to the [x] homepage. In 1989, 67% of American consumers stated that they were willing to pay 5 - 10% more for sustainable products. Products that we deemed sustainability-marketed in 2018 were considered sustainability-marketed in 2013 too, as we were unable to examine 2013 packaging for all products. Millennials gave an even more impressive showing, with 73 percent indicating a similar preference." The hierarchy among drivers of consumer loyalty and brand performance is changing, says Farraj. What is the Green List and how can it help protect the worlds natural wonders? Profit from the additional features of your individual account. Voir les partenaires de TheConversation France. In more than 90% of consumer packaged goods categories, sustainability-marketed products grew faster than their conventional counterparts. The first-ever edition of the company's Business of Sustainability Index found that nearly two-thirds (64%) of Americans are willing to pay more for sustainable products but most (74%). If you have a question youd like an expert to answer, please send it to climate.change@stuff.co.nz. "Consumers are really seeking to purchase products that help them stay true to their values and what they consider matters most to them," said Parker. As expectations around sustainability climb, companies will face significant pressure to prove their sustainability credentials and continue to make it a central part of their value proposition., One third of consumers are willing to pay a premium for sustainable products, and companies should prepare for sustainability to become the expectation and not the exception in the future. That across the board, consumers are willing to pay extra for one thing: sustainability. It can be done. On average, more than a one third (34 percent) of the population is willing to pay more for sustainable products or services, and those willing to pay more would accept a 25 percent premium on average. zharris@prosek.com, Internet Explorer presents a security risk. Given the evidence that consumer tastes are changing, an attitude of Why mess with a recipe that has worked well over the last 40 years? is the wrong one to take. Millennials and Gen Z are becoming a force to be reckoned with as they continue to represent a larger share of the consumer demographic. While the survey respondents were answering questions . Get full access to all features within our Business Solutions. I don't dream of a world with 99 cent hamburgers available at any roadside fast food place. Are consumers really willing to pay more for sustainable products? In fact, almost half (41%) of consumers from around the world say that they're highly willing to pay more for products that contain all-natural or organic ingredients. Interestingly, of the people that are willing to pay a sustainability premium, the premium amount is lowest for Consumer goods (22 percent premium on average) it is highest for Financial services (27 percent premium on average). statistic alerts) please log in with your personal account. Says Gstalder: While marketing good deeds is encouraged and expected by consumers, authenticity and credibility are essential. That across the board, consumers are willing to pay extra for one thing: sustainability. Companies should be aware that consumers are increasingly voting with their dollars against unsustainable brands. The legacy companies that will thrive are those that accept this shift and are willing to pivot, such as PepsiCo and Unilever. Climate-friendly defines products that reduce damage specifically to the climate. In 1998, the Council of the European Union passed a directive that setrules for the protection of farmed animals -- a directive updated in 2009 that led tofar more ethical treatment of animals there. Consumers have some understanding of what makes a product sustainable but it is not necessarily a consideration when making a purchase Although the majority of consumers recognise what makes a product sustainable i.e. I dream of a world in which all factory farms are destroyed. It's not just a morally good idea, either; it's lucrative. By comparison, 51% of Boomers (ages 50-64) said that they would pay a premium for sustainable products. This statistic presents the results of an online survey conducted from February 17 to March 7, 2014. Consumers are willing to pay more for greener products and want producers to provide better climate-related on-label packaging. Call me a geek, but I do love a good research report! Millennials want to know what companies are doing to make the world a better place. As CPG sales spiked . They expect a two-way, open dialogue with companies and their brands. A majority (55%) of consumers are willing to spend extra money in order to purchase environmentally friendly products, though at differing amounts. Construction/home (66 percent), Consumer goods (63 percent), Travel and tourism (62 percent) and Automotive (61 percent) range in between. Theres a noticeable break between generations, with 71% and 66% of Millennials and Gen Z willing to do so, compared to only 50% Gen X, 46% of Boomers and 39% Silent Generation. ", Deloitte, Share of consumers who were willing to pay more for sustainable goods in China as of November 2022, by category Statista, https://www.statista.com/statistics/1367681/china-consumers-willingness-to-pay-more-for-sustainable-goods/ (last visited March 02, 2023), Share of consumers who were willing to pay more for sustainable goods in China as of November 2022, by category [Graph], Deloitte, January 18, 2023. Consumers want #sustainable packaging - and most of them would pay more for it. Commercial research says 46% of consumers are more inclined to buy a product if it is eco-friendly. "Our sustainability. In 2014, 65% of total sales of consumer goods measured globally were generated by brands whose marketing conveyed commitment to social and/or environmental value. Consumer-goods brands that fail to take this into account will likely fall behind.. Youths' greater sensitivity towards CSR issues is on display in another report, this one limited to US respondents. On a global scale, the percentage of consumers willing to pay a premium for. Nielsen's 2014 Global Survey on Corporate Social Responsibility, released Tuesday, shows that 55 percent of global online consumers across 60 countries are willing to pay more for products and services from companies that are committed to positive social and environmental impact. Carbon dioxide emissions in France 1970-2021, Share of e-commerce GHG emissions worldwide 2020, by source, Leading e-commerce delivery methods used in France 2021, Average product return rates among digital shoppers in Europe 2021. Sustainability-marketed products are growing quickly in almost all CPG categories. It is no secret that companies must be responsive to customer demands and expectations if they want to survive. For this group, personal values are more important than personal benefits, such as cost or convenience. Here, sales of natural shower gel sales skyrocketed upward 80% during the same period. An Inc. 5000 company and a member of 1% Percent for the Planet, GreenPrints turnkey offerings help companies meet sustainability goals while increasing brand value and customer loyalty making it easy for businesses to do well by doing good. But the results should be interpreted cautiously. That's why we're seeing a shift towards sustainable farming, farm-to-table, and organic botanical ingredients.". Ultimately, the research that evaluates consumers willingness to pay more for green products has been mixed. Businesses must adapt to the times as consumers are voting with their wallets and Millennials, in particular, are demanding that companies put their money where their mouth is. Again, younger generations lead the way as higher shares of Generation Z (39 percent) and Millennials (42 percent) are willing to pay for sustainability compared to Gen. X (31 percent) and Baby Boomers (26 percent). Then you can access your favorite statistics via the star in the header. A weekly update of the most important issues driving the global agenda. For fifteen years, Rudominer has operated on the front lines and behind the scenes of numerous communications campaigns, providing strategic counsel to public officials, corporations, trade associations, and non-profits. Show publisher information 5 Ways to Connect Wireless Headphones to TV. Sustainability is a worldwide concern that continues to gain momentumespecially in countries where growing populations are putting additional stress on the environment, says Grace Farraj, senior vice president, Public Development & Sustainability, Nielsen. Consumers are trying to be responsible citizens of the world, and they expect the same from corporations. 2015 Nielsen Global Corporate Sustainability Report, 2015 Cone Communications Millennial CSR Study. Share of consumers who were willing to pay more for sustainable goods in China as of November 2022, by category [Graph]. For instance, while the overall shampoo category saw declines of 3.4% over a year long period ending April 2018, natural shampoos, which own 11.2% of the value share, are steadily growing at 2.2%. Image:Caleb Jones/Unsplash. Tech is close behind at 74%, while gas stations and convenience stores rank lower at 51% and 54% respectively. Nielsen's most recent Global Sustainability Report found that 66 percent of consumers said they were willing to pay more for sustainable brands, up from 55 percent in 2014. . This sum will continue to grow exponentially as more Millennials reach peak buying power. The Global Sustainability Study 2021 survey was conducted in July 2021 by Simon-Kucher & Partners, fielding through panel data provided by Dynata, an independent market research agency. As a result, e-commerce businesses that prioritize environmentally-friendly practices will likely see a competitive advantage. And investors should support companies in making the investments needed for the pivot. 75% of millennials are willing to pay extra for sustainable products.3Coffee cups, palm oil, and single-use plastics are some recent products to face public discussion, which leaves businesses rethinking both the sustainability of their materials and processes, and the environmental impact and recyclability of their products. In its2015 Nielsen Global Corporate Sustainability Report, Nielson found that 66% of global consumers say they are willing to pay more for sustainable brands up 55% from 2014. It also found that 73% of global Millennials are willing to pay extra for sustainable offerings up from 50% in 2014. The study also found a large degree of mistrust about companies environmental claims. The bottom line is that the corporate world cannot ignore the demands and expectations of Millennials, who are devout in their desire to associate with companies aligned with their values. While companies are increasingly using environmental claims to appeal to consumers, they also attract greater scrutiny. This is the result of a representative survey that we commissioned from INNOFACT. She's a strong young feminist poet, an inspiration, and I trust her product because she was open about how she sourced the materials for it. In 2018, that number had risen to about 85% . Some brands are even moving beyond simply eco-friendly and now seek to claim their products are climate-neutral. Millennials are the most willing to pay extra for sustainable offeringsalmost three-out-of-four respondents (73%), up from approximately half in 2014. To ensure the most secure and best overall experience on our website we recommend the latest versions of, Internet Explorer is no longer supported. Rudominers lifelong passion is using communication to foster social change. In 2015, Nielsen polled 30,000 consumers in 60 countries around the world. Commitment to social and environmental responsibility is surpassing some of the more traditional influences for many consumers. To use individual functions (e.g., mark statistics as favourites, set Good Environmental Choice Australia is a similar organisation. For example, one study found Spanish consumers were willing to pay 2237% more for green products, but Japanese consumers were only willing to pay 822% more for green products. This likely depressed the growth numbers, as many brands have become more sustainable over time. She's vocal about the fact that it costs a lot more than shirts from a company like H&M specifically because she only uses sustainable goods and ethical practices when it comes to the workers. They wanted to know more about what influences how people feel about brands, and how those feelings impact buying behavior. Learn more about how Statista can support your business. Overall, consumers identified . On the flip side, large global consumer-goods brands that ignore sustainability increase reputational and business risk. Climate Explained is a collaboration between The Conversation, Stuff and the New Zealand Science Media Centre to answer your questions about climate change. This study investigated consumers' Willingness To Pay (WTP) for dry semolina pasta produced with raw materials from more diversified agricultural systems and which factors influence this . You need a Statista Account for unlimited access. e-mail: rachel.pope@simon-kucher.com Almost three quarters of the . In Taiwan, for example, where 88% of surveyed consumers said that it is extremely or very important that companies implement programs to improve the environment, there is evidence of a growing trend in natural in personal care. Statista. Consumers expect more than ever from the brands they buy and increasingly are rewarding companies whose services and products are both good for them and good for society. For example, one study found Spanish consumers were willing to pay 22-37 per cent more for green products, but Japanese consumers were only willing to pay 8 per cent to 22 per cent more for . Millennials make up the fastest growing force in the marketplace. This behaviour isn't just limited to the wealthy in big economies. According to the findings, 78% of people are more likely to purchase a product that is clearly labeled as environmentally friendly. This statistic displays the share of consumers willing to pay extra for sustainable products in the Netherlands from 2014 to 2020. Consumer brands that havent embraced sustainability are at risk on many fronts, says Gstalder. Additionally, one third of Millennials will choose a sustainable alternative when available, whereas older generations are less likely to actively choose sustainable alternatives (24-29 percent). One overwhelming conclusion of the report? What do these findings mean for corporate managers and investors? They accounted for 16.6% of the market in 2018, up from 14.3% in 2013, and delivered nearly $114 billion in sales. January 18, 2023. Weve been on this journey for a while, but the clock is ticking and failure to think through the implications could have long-term consequences for traditional firms., Across industries and countries, sustainability is a significant purchase criterion -- though price and quality continue to dominate. 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