An online survey of more than 1,000 consumers took place in July and found 68% of respondents said they were willing to pay more for sustainable products. The study, which was designed to measure consumer attitudes towards sustainability, importance of sustainability and willingness-to-pay for sustainability, also focused on 17 different product/service categories of the following sectors: Consumer Goods & Retail; Automotive; Travel & Tourism; Energy/Utilities; Financial Services; and Construction/Home. Sustainability sentiment is particularly consistent across income levels. That said, some of those categories saw high growth in sustainability-marketed products sanitary napkins and laundry care were among the highest, at 150%. 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. In 2018, that number had risen to about 85% . (January 18, 2023). Are you interested in testing our business solutions? About a 3 minute read. For years, brand managers have groused that while consumers say they intend to buy sustainable products, in store they dont actually purchase them. Reports, such as Nielsen Insights , suggest the majority (73 percent) of people would change their consumption habits to reduce their impact on the environment, and almost half . NYU Sterns Center for Sustainable Business just completed extensive research into U.S. consumers actual purchasing of consumer packaged goods (CPG), using data contributed by IRI, and found that 50% of CPG growth from 2013 to 2018 came from sustainability-marketed products. 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. Nudge theory is used to understand how people think, make decisions and behave. Millennials gave an even more impressive showing, with 73 percent indicating a similar preference." Sixty-six percent of consumers say they are willing to pay more for sustainable brandsup from 55% in 2014 and 50% in 2013. Globally, 85 percent of people indicate that they have shifted their purchase behavior towards being more sustainable in the past five years -- however, we observe meaningful generational differences in attitude. A paid subscription is required for full access. Profit from the additional features of your individual account. Globally, willingness to pay for sustainable products or services is highest in US (42 percent), with these the US also representing the highest average premium (37 percent premium). 66% of survey respondents are willing to pay more for sustainable goods, up from 55% in 2014, and 50% in 2013 Sales of consumer goods from brands with a demonstrated commitment to sustainability have grown more than 4% globally, while those without grew less than 1%. Toilet tissue, facial tissue, milk, yogurt, coffee, salty snacks, and bottled juices were among those with the highest share in their category (more than 18%), while laundry care, floor cleaner, and chocolate candy had less than a 5% share. 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. This statistic displays the share of consumers willing to pay extra for sustainable products in the Netherlands from 2014 to 2020. Our own 2019 report, " The State of Consumer Spending: Gen Z . In the past year alone, sales of consumer goods from brands with a demonstrated commitment to sustainability have grown more than 4% globally, while those without grew less than 1%. Checking labels before buying. Nielsen's 2015 Global Corporate Sustainability Report has revealed that brands showing a commitment to sustainable practices are receiving support from consumers, who are willing to pay more for . CPGs that are not making the pivot will lose Kraft Heinz, whose investors have encouraged a cost-cutting approach that is backfiring, is a case in point. 5 Ways to Connect Wireless Headphones to TV. Since then, the trend has only increased: a 2015 Nielsen poll showed that 66% of global consumers are willing to pay more for environmentally sustainable products. While 66 percent of global consumers are willing to pay more for sustainable goods, a full 73 percent of Millennials are (Nielsen defines Millennials as those born from 1977 to 1995). I don't dream of a world in which I can get a shirt for $3.99 just for the sake of that. Green consumption includes more environmentally friendly raw materials, packaging and production methods, lower carbon emissions during transportation and use, and better protection for people involved in production and trade. If you are an admin, please authenticate by logging in again. Prosek Partners Good Environmental Choice Australia is a similar organisation. Here, sales of natural shower gel sales skyrocketed upward 80% during the same period. According to Chicago-based Nielsen's 2019 "Protein Proliferation" report, 19% of consumers surveyed said that they intended to increase their consumption of meat and seafood more than any other protein group. To use individual functions (e.g., mark statistics as favourites, set 2023 Nielsen Consumer LLC. 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. . A 2015 global survey by Nielsen found that 66 per cent of respondents were willing to pay more for sustainable goods. Consumers are voting with their dollars against unsustainable brands. But in a increasingly interconnected world, it's starting to be normal to think critically about where things come from and whether the company you're supporting is a responsible corporate citizen. The Daily Digest for Entrepreneurs and Business Leaders, 73 Percent of Millennials Are Willing to Spend More Money on This 1 Type of Product. Millennials make up the fastest growing force in the marketplace. As consumers become increasingly aware of what they put in and on their bodies, theyre also interested in buyingand sometimes paying morefor products that simultaneously help the environment. Both are good tools for building trust. 470-788-0718 Defending and preserving our planet is not only the right thing to do, its good business. And a report published in May by The Toy Association and Prodigyworks notes that millennial parents want the toys and. .chakra .wef-10kdnp0{margin-top:16px;margin-bottom:16px;line-height:1.388;}What is the World Economic Forum doing about the circular economy? While this statistic is telling on its own, what's more telling is that 81% of those interviewed said that they planned to buy more sustainable products over the next five years.. And environmental consciousness isn't a new trend among consumers. In a free market economy, it is very difficult to force people to pay more for products. We see the impact of similar sentiment around shower gel, a category where naturals own 10.3% of the value share, and the overall category saw sales decline 0.8%. The U.S. sustainability market is projected to reach $150 billion in sales by 2021, according to Nielsen . Share of consumers who were willing to pay more for sustainable goods in China as of November 2022, by category [Graph]. And as social media channels continue to burgeon, the voice of younger generations will only increase the demand for sustainability. 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. Sustainable materials cost more to grow and manufacture, reputable third-party certifications add further costs and using organic materials is more expensive than alternatives such as mass-produced chemicals. Brands that actively reinforce societal commitment must amplify and socialize their message using multiple sources and distribution channels. Its about exploring your trustworthy methods of communication, then selecting one that aligns with your objectives.. We examined over 36 categories and more than 71,000 SKUs, which accounted for 40% of CPG dollar sales over the five-year period. Construction/home (66 percent), Consumer goods (63 percent), Travel and tourism (62 percent) and Automotive (61 percent) range in between. Register in seconds and access exclusive features. Consumers from 60 countries were surveyed for this report. 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. On a global scale, the percentage of consumers willing to pay a premium for. All rights reserved. This is a relatively new perspective for consumers. Our analysis looked at products on-pack communication about their sustainability. January 18, 2023. All Rights Reserved. Given that sustainability issues vary by category, we also assessed whether a claim concerned a material environmental or social issue for that category. Companies across industries have . As US psychologist Icek Ajzen wrote: Actions, then, are controlled by intentions, but not all intentions are carried out . Get full access to all features within our Business Solutions. Nielsen combines sustainability into free-from, clean, simple, sustainable and . A balanced approach is key for brand communicators, with the emphasis on demonstrating good deeds versus self-serving promotion.. When looking at both Baby Boomers and Generation X, 24 percent across each have significantly changed their behavior towards being more sustainable -- this figure climbs to 32 percent for Millennials. All these terms are used in labelling to make us feel good if we buy products claimed to minimise harm to the planet and the environment. World Economic Forum articles may be republished in accordance with the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International Public License, and in accordance with our Terms of Use. In a study of 30,000 consumers across 60 countries, Nielsen found that nearly 2/3 of consumers globally are willing to pay more for sustainable goods and that is on the rise. how much more are you willing to pay compared to regular goods) when purchasing the following categories? Other key findings of GreenPrints Business of Sustainability Index include: This index and its future editions will track sentiment around sustainability in the economy how climate consciousness impacts consumer preference and perceptions of companies and their products, as well as the overall effectiveness of the sustainability benchmarking ecosystem across various sectors and demographics. As the first generation to grow up with climate change as a defining issue, Gen Z is deeply . Climate Explained is a collaboration between The Conversation, Stuff and the New Zealand Science Media Centre to answer your questions about climate change. I dream of a world in which all factory farms are destroyed. 75% of Millennials are willing to pay more for an environmentally sustainable product, compared to 63% of Gen Z, 64% of Gen X, and 57% of Boomers. www.simon-kucher.com, Internet Explorer presents a security risk. Our analysis did not include the term natural (which is ubiquitous but means nothing) or marketing claims related to social causes or charities. This behaviour isn't just limited to the wealthy in big economies. A majority (55%) of consumers are willing to spend extra money in order to purchase environmentally friendly products, though at differing amounts. Sustainability-marketed products are growing quickly in almost all CPG categories. It's not just a morally good idea, either; it's lucrative. According to the findings, 78% of people are more likely to purchase a product that is clearly labeled as environmentally friendly. They wanted to know more about what influences how people feel about brands, and how those feelings impact buying behavior. You need a Statista Account for unlimited access. In the past year alone, sales of consumer goods from brands with a demonstrated commitment to sustainability have grown more than 4% globally, while those without grew less than 1%. That across the board, consumers are willing to pay extra for one thing: sustainability. Available: https://www.statista.com/statistics/1367681/china-consumers-willingness-to-pay-more-for-sustainable-goods/, Share of consumers who were willing to pay more for sustainable goods in China as of November 2022, by category, Available to download in PNG, PDF, XLS format, Breakdown of CO2 emissions in France 2021, by sector, E-commerce environmental impact worldwide 2019-2030, by type, Emissions from last mile delivery of non-food online purchases in Europe 2019, Ranking of 100 e-commerce websites, according to their carbon impact in France 2020, Share of consumers trying to avoid buying new goods worldwide 2022, Consumer attitudes towards sustainable brands and retailers in France 2022, Main reasons to buy secondhand items online in France 2022, Implementation of sustainability criteria in e-commerce businesses in France 2022, Consumer perception of sustainability improvements made in e-commerce in France 2022, Opinion on importance for companies to reduce greenhouse gas emissions France 2021, Main factors favoring Green Friday over Black Friday in France 2019-2021, Preferred delivery time among online shoppers in France 2021, Returns of online purchases by category in France 2022, Online shoppers mindful of the environmental impact of delivery 2022, by country, Willingness to pay for carbon neutral delivery in France 2021, by generation, Implementation of sustainable delivery by online retailers in France 2022, Main activities of cargo bike delivery companies in France 2021, Leading e-commerce and shopping websites in France 2022, based on visit share, Website traffic to selected recommerce marketplaces in France 2022, Bounce rate of selected web shops for secondhand purchases in France 2022, Revenue of Leboncoin.fr in France 2015-2021, Marketplace revenue of Cdiscount.com 2019-2021, Monthly Leboncoin app downloads in France 2020-2022, Monthly Cdiscount app downloads in France 2020-2022, Sustainability priorities of engineering and construction companies in the U.S. 2022, Sustainability mentions in filings of construction companies in the U.S. 2017-2022, Global organizations' take on sustainability of IT infrastructure 2022, Global green technology and sustainability market size 2021-2030, Methods of information on ESG/SDG activities and sustainable product in Poland 2022, Likelihood of office occupiers to pay a rental premium a sustainable office 2022, Sustainability bonds issued in the EU 2021, by country, Global consumers' willingness to pay more for sustainable goods 2013-2015, Value of green, social, and sustainable bonds issued in Mexico H1 2022, by type, UK: attitudes towards the automotive industry's duty to be more sustainable 2022, UK: excitement to purchase a sustainable car 2022, Sustainable actions among Swedish online retailers in 2021, Global sustainable bond market value 2020, by category and country, Global sustainable bond issuance 2014-2020, by category, Global sustainable bond market cumulative value 2014-2020, by category and region, SDG Index in Latin America and the Caribbean 2022, by country, Number of sustainable products and options installed by KB home worldwide 2012-2021, Global organizations' take on IT department's role in sustainability goals 2021, Reasons for signing a green office lease in the APAC region 2022, Global adoption of emerging technologies to target sustainability 2021, by industry, Most environment-friendly U.S. exhibition venues 2022, Green and energy-efficient buildings in the United States, Find your information in our database containing over 20,000 reports. 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