Businesses are in a bind. 470-788-0718 But brands can nudge consumers towards more eco-friendly products. , Feb 8, 2023. This statistic presents the results of an online survey conducted from February 17 to March 7, 2014. 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 . 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. 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). We examined over 36 categories and more than 71,000 SKUs, which accounted for 40% of CPG dollar sales over the five-year period. Colloquially, use of the word green is applied broadly to almost everything related to benefiting the environment, from production and transportation to architecture and even fashion. "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. When browsing beauty products, my first question is, "Is it cruelty-free?" Are consumers really willing to pay more for sustainable products? 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%). 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. 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. 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. Ryan Rudomineris a principal at R2 Strategic Consulting where he specializes in strategic communications, advocacy, and media relations. 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. Commercial research says 46% of consumers are more inclined to buy a product if it is eco-friendly. Nielsen More than half of Europeans (51%) said they are willing to pay more for climate friendly food. 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. 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. It is no secret that companies must be responsive to customer demands and expectations if they want to survive. Already in 2015, a Nielsen report found that 73 percent of the Millennial generation was willing to pay more for sustainable goods. Are you interested in testing our business solutions? 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. Studies show eco-friendly logos and labels can be used to nudge consumers toward sustainable fashion, food consumption and eco-friendly offerings. 9. Traditional advertising will not work with Millennials. Queensland University of Technology apporte un financement en tant que membre adhrent de TheConversation AU. According to Nielsen, 66% of all consumers are willing to pay more for sustainable brands. Millennials represent the consumer market of the future, and it behooves corporations to read the tea leaves. By 2021, consumers are expected to spend $150 billion on sustainable goods. A new report reveals all. As economists say, as price lowers, our willingness and ability to buy an item increase. 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. Among millennials,. Ultimately, the research that evaluates consumers willingness to pay more for green products has been mixed. And how can we encourage people to make good choices? In more than 90% of consumer packaged goods categories, sustainability-marketed products grew faster than their conventional counterparts. Feb 28, 2023. 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 . Younger shoppers are the most willing to. Millennials make up the fastest growing force in the marketplace. For most of the history of the moderneconomy, the sourcing of products didn't even cross the minds of those shopping. Wed suggest they follow the data. This statistic displays the share of consumers willing to pay extra for sustainable products in the Netherlands from 2014 to 2020. 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. A 2015 global online survey by Nielsen reflected Brabeck-Letmathe's comments, with research showing that 66 percent of the 30,000-plus respondents said they would be willing to pay extra for . 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. Products and services that are offered from socially responsible companies may be able to charge more, according to a report by Nielsen. Meanwhile, fish and seafood dollars and units rose 8.7% and 2.7%, respectively, from 2017 to 2019, outpacing the growth of other proteins, including legumes, nuts and seeds. They are willing to rethink their buying habits to incorporate environmental and social product benefits into their buying decisions. 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. Brands can bring their CSR efforts to life through authentic storytelling. Globally, sustainability is rated as an important purchase criterion for 60 percent of consumers. As a Premium user you get access to the detailed source references and background information about this statistic. That across the board, consumers are willing to pay extra for one thing: sustainability. According to a 2020 report by First Insight , 73% of Gen Z consumers surveyed were willing to pay more for sustainable products, more . That across the board, consumers are willing to pay extra for one thing: sustainability. 2023 Nielsen Consumer LLC. This shows that sustainability has been on consumers' minds for quite. 43% of consumers want brands to be more aggressive about showing sustainable products on-site to further personalize their shopping experience. More demand would mean more production and lower unit price costs. 50% of CPG growth from 2013 to 2018 came from sustainability-marketed products. In the US, this number is just over the global average at 61 percent. Please do not hesitate to contact me. A 2014 Nielsen study found that 55 percent of global consumers are so passionate about the planet and its people that they're willing to pay more for products and services provided by. 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. For years, researchers have examined climate-oriented consumption to see if it wins peoples support. Designed by Elegant Themes | Powered by WordPress, 66% of survey respondents are willing to pay more for sustainable goods, up from 55% in 2014, and 50% in 2013. Sustainability sentiment is particularly consistent across income levels. (January 18, 2023). Eco-friendly isnt quite so broad and defines products or practices that do not harm the Earths environment. For years, brand managers have groused that consumers say they intend to buy sustainable products but dont actually buy them. According to the2015 Cone Communications Millennial CSR Study, More than nine-in-10 Millennials would switch brands to one associated with a cause (91% vs. 85% U.S. average), and two-thirds use social media to engage around CSR (66% vs. 53% U.S. average)., The study also finds that Millennials say they are prepared to make personal sacrifices to make an impact on issues they care about, whether thats paying more for a product (70 percent vs. 66 percent US average), sharing products rather than buying (66 percent vs. 56 percent) or taking a pay cut to work for a responsible company (62 percent vs. 56 percent).. Why cities should be fully recognized stakeholders within the UN system, This Architect Says Sustainable Timber Could Be The Future Of Our Cities, 3 solutions helping net-zero aviation take off, is affecting economies, industries and global issues, with our crowdsourced digital platform to deliver impact at scale. While attitudes vary across generations, countries, and industries, 85% of consumers have become greener in their purchasing in recent years. Companies have used this conventional wisdom as justification for not making their products more sustainable. On Earth Day 2020, the organisation Climate Neutral an independent non-profit organisation working to decrease global carbon emissions confirmed 103 brands had completed its certification process in 2020 and 50 other brands were still in the process. On a global scale, the percentage of consumers willing to pay a premium for. Nudge theory is used to understand how people think, make decisions and behave. CSR can build brand loyalty, raise awareness, and strengthen reputations, or it can have the opposite effect. The relative importance of sustainability during the purchase process will continue to increase. Saving biodiversity: why our mental and physical health depends on it. Using multiple communication methods is important to demonstrate good deeds, such as third-party validation (news coverage), annual reports, affiliation with a respected non-profit or civic organization, employee volunteerism, advertising, or reporting actual work in the community on a web site. Climate-friendly defines products that reduce damage specifically to the climate. Looking at web sites for information on business and manufacturing practices. This isn't a pipe dream. A 2015 global survey by Nielsen found that 66 per cent of respondents were willing to pay more for sustainable goods. 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. IRIs data comes from bar scan codes at retail checkout in food, drug, dollar, and mass merchandisers. 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. Access to this and all other statistics on 80,000 topics from, Show sources information Deloitte. to incorporate the statistic into your presentation at any time. tel. Companies across industries have . You need a Statista Account for unlimited access. The U.S. sustainability market is projected to reach $150 billion in sales by 2021, according to Nielsen . Corporate leadership should no longer give brand managers a pass when they claim that there is no demand for sustainable products. 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. Millennials and Gen Z are becoming a force to be reckoned with as they continue to represent a larger share of the consumer demographic. This conventional wisdom has been used by many brands as justification for not making their products more sustainable. (1) Background: The pressure that agricultural systems' intensive management exerts on the environment concerns society. Millennials want to know what companies are doing to make the world a better place. Topping the list of sustainability factors that influence purchasing for nearly two-of-three (62%) consumers globally: brand trust. And investors should support companies in making the investments needed for the pivot. In a study of more than 21,000 US households, Nielsen analyzed consumers' attitudes towards various sustainable attributes across 13 product categories. But research continues to show few consumers who report positive attitudes toward eco-friendly products actually follow through with their wallets. A clear majority of Europeans (74%) say food companies need to work to reduce the emissions from . All Rights Reserved. Droits d'auteur 20102023, The Conversation France (assoc. In burgeoning sustainability markets, however, natural and organic are paving the way for more detailed and specific claims. GreenPrint, A Public Benefit Corporation, is on pace to offset over 30 million metric tons of carbon by 2025. 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. But the results should be interpreted cautiously. About three in four Millennials (74 percent) and Generation Z consumers (72 percent) are willing to pay more for sustainable products and services, according to The Nielsen Company. Even toys can get the climate-friendly treatment. Facebook: quarterly number of MAU (monthly active users) worldwide 2008-2022, Quarterly smartphone market share worldwide by vendor 2009-2022, Number of apps available in leading app stores Q3 2022, Research expert covering e-commerce and FMCG in Greater China, Profit from additional features with an Employee Account. Percentage points exceeding 100 percent are probably due to rounding. Across industries, willingness to pay for sustainability is highest in Consumer goods (38 percent), and lowest for Energy/utilities (31 percent). For the US, 22 percent of consumers indicate major changes to the behavior, but that number jumps to 55 percent when including those who say theyve at least made some modest changes. For years, researchers have examined climate-oriented consumption to see if it actually wins consumer support. Currently, you are using a shared account. 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. "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. But nearly 60% are unwilling to pay more money for that eco-friendly product.. By almost any measure, Millennials place a premium on corporate social responsibility (CSR) efforts. 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%. According to our Consumers Buy The Change They Wish To See in The World report, we found that natural and organic ingredients and certifications serve as the entry level point for nearly every market when it comes to sustainability attributes consumers are searching for. Are you making an effort to reach these socially conscious young people? Consumers from 60 countries were surveyed for this report. So while not all consumers will pay more for green climate-friendly products despite the best of intentions, we can slowly nudge them to make better choices for the planet. Can changing your mindset change everything? As soon as this statistic is updated, you will immediately be notified via e-mail. Commitment to either social value or the consumers community are also important (each influencing 43% and 41% of respondents, respectively). Marketers, operators, and merchants need to take the following steps: one, penetrate the right segment; two, unlock what motivates that segment to spend money; and three, act on strategies that build loyalty through ongoing consumer engagement. Please create an employee account to be able to mark statistics as favorites. 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 . GreenPrint And a report published in May by The Toy Association and Prodigyworks notes that millennial parents want the toys and. By comparison, 51% of Boomers (ages 50-64) said that they would pay a premium for sustainable products. Consumers are willing to pay more for greener products and want producers to provide better climate-related on-label packaging. Companies must invest, innovate and transform their business models now to protect their long-term profitability and viability. 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. 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. Im seeing quite a few climate-friendly products at the supermarket. We made no attempt to assess if products marketed as sustainable were, in fact, sustainable. Or to remain unmoved by those facing increasingly poor living conditions across the globe. Georgetown University School of Continuing Studies. What do these findings mean for corporate managers and investors? I don't dream of a world full of cheap lip gloss that was tested on animals; I dream of one in which that kind of beauty product is illegal everywhere, period. This sum will continue to grow exponentially as more Millennials reach peak buying power. That's why we're seeing a shift towards sustainable farming, farm-to-table, and organic botanical ingredients.". 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. Instead, we focused on whether the marketing of a product as sustainable would drive purchases. Hence, despite environmental concern and the positive attitude of customers towards sustainability and green products, its estimated the market share of green products will reach only 25% of store sales by 2021. It can be done. Millennials are the most willing to pay extra for sustainable offeringsalmost three-out-of-four respondents (73%), up from approximately half in 2014. 28 Feb 2023 --- Sustainability factors are increasingly influencing the purchasing behavior of European consumers, according to a study published by crop nutrition company Yara International via IPSOS. Millennials gave an even more impressive showing, with 73 percent indicating a similar preference." We help our clients achieve growth and profit targets by applying practical, evidence-based strategies. Prosek Partners 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. Simon-Kucher & Partners, Strategy & Marketing Consultants: Simon-Kucher & Partners is a global consulting firm specializing in TopLine Power. 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. 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. Commitment to social and environmental responsibility is surpassing some of the more traditional influences for many consumers. [Online]. Personal values indeed. 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. The survey reports that 58% of Europeans consider climate impact . For more details, review our .chakra .wef-12jlgmc{-webkit-transition:all 0.15s ease-out;transition:all 0.15s ease-out;cursor:pointer;-webkit-text-decoration:none;text-decoration:none;outline:none;color:inherit;font-weight:700;}.chakra .wef-12jlgmc:hover,.chakra .wef-12jlgmc[data-hover]{-webkit-text-decoration:underline;text-decoration:underline;}.chakra .wef-12jlgmc:focus,.chakra .wef-12jlgmc[data-focus]{box-shadow:0 0 0 3px rgba(168,203,251,0.5);}privacy policy. 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). In fact, the majority (73%) of global consumers say they would definitely or probably change their consumption behavior to reduce their impact on the environment. Show publisher information Simon-Kucher & Partners is regarded as the worlds leading pricing advisor and thought leader. 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. I don't dream of a world with 99 cent hamburgers available at any roadside fast food place. 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. Then you can access your favorite statistics via the star in the header. While companies are increasingly using environmental claims to appeal to consumers, they also attract greater scrutiny. I can attest to the fact that sustainability isn't just something I "sorta kinda" consider--it's one of the primary reasons I either buy or don't buy from consumer brands. 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. 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. Products must meet similar standards (ISO 14020 and ISO 14024). 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 . Consumers could note if they were willing to pay "a little" or "a lot" for each sustainability benefit. More than half (56%) of Americans would use a credit card that could calculate and offset the environmental footprint of products purchased. This figure is even higher for millennials (73%) and Generation Z (72%). : (617) 231-4551 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. In a study byHorizon Medias Finger on the Pulse, 81 percent of Millennials expect companies to make a public commitment to good corporate citizenship.. As US psychologist Icek Ajzen wrote: Actions, then, are controlled by intentions, but not all intentions are carried out . Says Gstalder: While marketing good deeds is encouraged and expected by consumers, authenticity and credibility are essential. This is especially true for Millennials. 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. 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