Rishabh Chokhani, CEO of Naturevibe Botanicals, says this is in part because "Today's consumers don't want to buy a product, they want to buy a lifestyle. The report, "Doing Well by Doing Good," found that most consumers are willing to pay more money for good and services that are sustainable. 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). Millennials gave an even more impressive showing, with 73 percent indicating a similar preference." Then you can access your favorite statistics via the star in the header. A substantial portion of consumers are currently willing to pay for sustainability, demonstrating that there is a market for mission-driven green companies and why we see a rise in sustainable companies around the world. Consumers are also willing to pay more for chocolate products that are free-from 'undesirable' or artificial ingredients, a subset of products that makes up 15.2% of the overall chocolate category . Nudge theory is used to understand how people think, make decisions and behave. 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. Consumer-goods brands that fail to take this into account will likely fall behind.. TV ads highlighting a companys commitment to positive social and/or environmental impact are influential in the path to purchase for 34% of global respondents. Consumers are voting with their dollars against unsustainable brands. Seventh Generation, Sundial Brands, and Pukka Herbs. As a result, e-commerce businesses that prioritize environmentally-friendly practices will likely see a competitive advantage. Consumers from 60 countries were surveyed for this report. This likely depressed the growth numbers, as many brands have become more sustainable over time. 'Global consumer-goods' brands that ignore sustainability increase reputational and business risk' Nielsen's research also found that 66 percent of consumers were willing to pay more for sustainable goods in comparison to 50 percent in 2013. Call me a geek, but I do love a good research report! Despite the fact that Millennials are coming of age in one of the most difficult economic climates in the past 100 years, they continue to be most willing to pay extra for sustainable offeringsalmost three-out-of-four respondents (73%) in the latest findings, up from approximately half in 2014. Globally, sustainability is rated as an important purchase criterion for 60 percent of consumers. Millennials and Gen Z are becoming a force to be reckoned with as they continue to represent a larger share of the consumer demographic. 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. Simon-Kucher & Partners is regarded as the worlds leading pricing advisor and thought leader. Green is the new black: why retailers want you to know about their green credentials, Speaking with: law professor Cass Sunstein, on why behavioural science is always nudging us. www.simon-kucher.com, Internet Explorer presents a security risk. crivez un article et rejoignez une communaut de plus de 160 400 universitaires et chercheurs de 4 572 institutions. Among the 66% of global respondents willing to pay more, over 50% of them are influenced by key sustainability factors, such as a product being made from fresh, natural and/or organic ingredients (69%), a company being environmentally friendly (58%), and company being known for its commitment to social value (56%); sales and coupons didnt even make the top five. In a study byHorizon Medias Finger on the Pulse, 81 percent of Millennials expect companies to make a public commitment to good corporate citizenship.. .chakra .wef-10kdnp0{margin-top:16px;margin-bottom:16px;line-height:1.388;}What is the World Economic Forum doing about the circular economy? Many sustainable trends in new markets start with beauty and personal care. The Generational Gap: Younger consumers are more actively taking steps towards being more sustainable. The future for CPG, and increasingly for other categories such as apparel, is sustainable. The shift in consumer buying, where more consumers are willing to pay more for environmentally conscious products, underscores the need for manufacturing companies to enhance their commitment to responsible business practices using technologies that support more sustainable product design and development. You need at least a Starter Account to use this feature. The Nielsen Global Survey of Corporate Social Responsibility and Sustainability was conducted between Feb. 23-March 13, 2015, and polled more than 30,000 consumers in 60 countries throughout Asia-Pacific, Europe, Latin America, the Middle East, Africa, and North America. For further information please contact: 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. 470-788-0718 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 . I dream of a world in which all factory farms are destroyed. An international study of 20,000 customers by grocery brand giant Unilever identified one in three (33%) people were choosing to buy from brands they believe are doing environmental good. Simple economies of scale also impact on price. Georgetown University School of Continuing Studies. Companies that dont have sustainability as part of their core value proposition need to act now to protect against future reputational impacts and loss of market share, said Shikha Jain, author of the study and Partner at Simon-Kucher & Partners. Nearly three . What do these findings mean for corporate managers and investors? Products must meet similar standards (ISO 14020 and ISO 14024). For years, brand managers have groused that consumers say they intend to buy sustainable products but dont actually buy them. Jun 27, 2014 The willingness to pay for sustainable products has increased universally since 2011. Professor of Marketing and Consumer Behaviour, Queensland University of Technology. Commitment to social and environmental responsibility is surpassing some of the more traditional influences for many consumers. You can unsubscribe at any time using the link in our emails. "Despite the fact that Millennials are coming of age in one of the most difficult economic climates in the past 100 years, they continue to be most willing to pay extra for sustainable offerings--almost three-out-of-four respondents," says Nielsen. GreenPrint Millennials represent the consumer market of the future, and it behooves corporations to read the tea leaves. In terms of how much, Gen. Z (32 percent premium) and Millennials (31 percent premium) are willing to pay more than twice as big a premium as Baby Boomers (14 percent premium) and a third more relative to Gen. X (21 percent premium). But research continues to show few consumers who report positive attitudes toward eco-friendly products actually follow through with their wallets. Most important, products marketed as sustainable grew 5.6 times faster than those that were not. 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). To trust a company statement, 45% of Americans say they need a third-party validating source. There are several reasons for this. In 1989, 67% of American consumers stated that they were willing to pay 5 - 10% more for sustainable products. All Rights Reserved. Queensland University of Technology apporte un financement en tant que membre adhrent de TheConversation AU. New York-based Nielsen forecasts the market to reach somewhere between $142.4 billion and $150.1 billion by 2021. Our analysis looked at products on-pack communication about their sustainability. The study also found a large degree of mistrust about companies environmental claims. Companies have used this conventional wisdom as justification for not making their products more sustainable. COLORADO SPRINGS, US (ICIS)-Consumers are willing to pay more for sustainable products that can be recycled or reused, according to a new survey of 6,000 people worldwide by consultancy Accenture. Businesses are in a bind. "Share of consumers who were willing to pay more for sustainable goods in China as of November 2022, by category." The survey was fielded from February 15 to February 16, 2021 among a demographically balanced nationally representative sample of 1,017 U.S. adults 18 years of age and older. According to a survey conducted among Chinese adults in November 2022, around 66 percent of respondents stated that they were willing to pay more for sustainable goods. This is a relatively new perspective for consumers. 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. Says Gstalder: While marketing good deeds is encouraged and expected by consumers, authenticity and credibility are essential. 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. If you are an admin, please authenticate by logging in again. Speaking with: law professor Cass Sunstein, on why behavioural science is always nudging us. People want to feel that whatever they are buying aligns with their personal values. 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. A majority (55%) of consumers are willing to spend extra money in order to purchase environmentally friendly products, though at differing amounts. Companies must act now to avoid obsolescence in the future. To ensure consistent and accurate representation of the U.S. general population 18 years of age and older, data was weighted by the following variables: sex, age, geographic region, race/ethnicity, and education. For years, researchers have examined climate-oriented consumption to see if it wins peoples support. Millennials already played a significant . CSR can build brand loyalty, raise awareness, and strengthen reputations, or it can have the opposite effect. Paying attention to public opinion on specific brands in the news or on social media. 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. ", 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. Overview and forecasts on trending topics, Industry and market insights and forecasts, Key figures and rankings about companies and products, Consumer and brand insights and preferences in various industries, Detailed information about political and social topics, All key figures about countries and regions, Market forecast and expert KPIs for 600+ segments in 150+ countries, Insights on consumer attitudes and behavior worldwide, Business information on 60m+ public and private companies, Detailed information for 35,000+ online stores and marketplaces. If you have a question youd like an expert to answer, please send it to climate.change@stuff.co.nz. Conveying CSR efforts to Millennials requires authenticity, and a unique approach as Millennials grew up with the Internet and want their voices heard. While the survey respondents were answering questions . This shows that sustainability has been on consumers' minds for quite. Those earning $20,000 or less are actually 5% more willing than those with incomes greater than $50,000 to pay more for products and services that come from companies who are committed to positive social and environmental impact (68% vs. 63%). But the results should be interpreted cautiously. 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. According to the report, sales of consumer goods from brands with a demonstrated commitment to sustainability have grown more than 4% globally in the past year, while those without grew less. As companies look to break into new markets, they must understand that each market demands its own approach. Vietnamese consumers are the most socially-conscious among Southeast Asians, with 86 percent expressing their willingness to pay extra for products and services from firms which are committed to positive social and environmental impact, a new Nielsen survey found. Among the 66% of global respondents willing to pay more, over 50% of them are influenced by key sustainability factors, such as a product being made from fresh, natural and/or organic ingredients (69%), a company being environmentally friendly (58%), and company being known for its commitment to social value (56%); sales and coupons didn't even What is the Green List and how can it help protect the worlds natural wonders? 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). Some of the necessary transformation can be accomplished by reinventing legacy products, as Unilever has shown with its sustainable living brands, now delivering 70% of its turnover growth. For example, the climatop label certifies products that generate significantly less greenhouse gas than comparable products. In the US, this number is just over the global average at 61 percent. A majority of people have doubts when companies say they are environmentally friendly, with 53% of Americans never or only sometimes believing such claims. You need a Statista Account for unlimited access. Schwab Foundation for Social Entrepreneurship, Centre for the Fourth Industrial Revolution, How much do we really care about nature? More than half (56%) of Americans would use a credit card that could calculate and offset the environmental footprint of products purchased. However, as demand grows for sustainable products and they become the expectation rather than the exception, sustainability will become table stakes and hygiene factors, said Jain. For years, researchers have examined climate-oriented consumption to see if it actually wins consumer support. it is biodegradable (65%) or made from recycled packaging (60%), when it comes to making a purchase, consumers value durability . 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). This figure is even higher for millennials (73%) and Generation Z (72%). All rights reserved. 2023 Nielsen Consumer LLC. In its 2015 Nielsen Global Corporate Sustainability Report, Nielson found that "66% of global consumers say they're 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. [Online]. As US psychologist Icek Ajzen wrote: Actions, then, are controlled by intentions, but not all intentions are carried out . Nature is worth $44 trillion to the global economy, according to a recent World Economic Forum estimate. Ryan Rudomineris a principal at R2 Strategic Consulting where he specializes in strategic communications, advocacy, and media relations. This is especially true for Millennials. The hierarchy among drivers of consumer loyalty and brand performance is changing, says Farraj. Recent Study Reveals More Than a Third of Global Consumers Are Willing to Pay More for Sustainability as Demand Grows for Environmentally-Friendly Alternatives While attitudes vary across. Overall, consumers identified . We made no attempt to assess if products marketed as sustainable were, in fact, sustainable. They expect a two-way, open dialogue with companies and their brands. 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. This conventional wisdom has been used by many brands as justification for not making their products more sustainable. Companies that are able to navigate the business of sustainability will be best positioned for future success.. They are willing to rethink their buying habits to incorporate environmental and social product benefits into their buying decisions. The Nielsen Global Survey on Corporate Social Responsibility polled more than 29,000 Internet respondents in 58 countries. It's not just a morally good idea, either; it's lucrative. 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. Looking at web sites for information on business and manufacturing practices. Reports such as Nielsen Insights suggest the majority (73%) of consumers would change their consumption habits to reduce their impact on the environment, and almost half (46%) would switch to environmentally friendly products. In 2015, brands who showed a commitment to sustainability saw sales grow more than 4% globally. Or to remain unmoved by those facing increasingly poor living conditions across the globe. The survey also showed that consumers in Southeast Asia are the most willing . 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. 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. A new study, looking at the sales from 2013 to 2018 of products marketed as sustainable, finds the conventional wisdom isnt true. Droits d'auteur 20102023, The Conversation France (assoc. According to market research firm Nielsen, just 22% of the world's consumers were willing to pay more for an eco-friendly product in 2011, despite the fact 83% thought it was important. Nielsen, an S&P 500 company, has operations in over 100 countries that cover more than 90% of the worlds population. This isn't a pipe dream. While attitudes towards sustainability vary between generations, they also vary across countries -- when looking at consumers who have either made significant changes to their purchasing behavior or completely changed their way of living to be more sustainable, Austria leads the way (42 percent), followed by Italy (41 percent), Spain (35 percent) and Germany (34 percent). Green is the new black: why retailers want you to know about their green credentials. This indicates an opportunity for consumer-goods brands that have already built a high level of trust with consumers to evaluate where best to introduce sustainable products into the market to drive growth, says Carol Gstalder, senior vice president, Reputation & Public Relations Solutions, Nielsen. Been on consumers & # x27 ; minds for quite to avoid obsolescence the! That consumers say they need a third-party validating source ; it 's not just morally! As apparel, is sustainable you need at least a Starter Account use. 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