consumers willing to pay more for sustainable products nielsen

May 15, 2023 0 Comments

By 2021, consumers are expected to spend $150 billion on sustainable goods. 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 2014, less than 30 . 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). 9. Among millennials,. In a study byHorizon Medias Finger on the Pulse, 81 percent of Millennials expect companies to make a public commitment to good corporate citizenship.. If you are an admin, please authenticate by logging in again. 5 Ways to Connect Wireless Headphones to TV. Ultimately, the research that evaluates consumers willingness to pay more for green products has been mixed. Indeed, one recent report revealed that certain categories of products with . Millennials gave an even more impressive showing, with 73 percent indicating a similar preference." 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. As a Premium user you get access to background information and details about the release of this statistic. , Feb 8, 2023. Saving biodiversity: why our mental and physical health depends on it. Most important, products marketed as sustainable grew 5.6 times faster than those that were not. 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. Accessed March 02, 2023. https://www.statista.com/statistics/1367681/china-consumers-willingness-to-pay-more-for-sustainable-goods/, Deloitte. zharris@prosek.com, Internet Explorer presents a security risk. And investors should support companies in making the investments needed for the pivot. Consumers from 60 countries were surveyed for this report. 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. One overwhelming conclusion of the report? Broadcasting sustainability would capture an untapped consumer base but also sow distrust, said Pete Davis, CEO and Co-Founder of GreenPrint. 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. As companies look to break into new markets, they must understand that each market demands its own approach. When browsing beauty products, my first question is, "Is it cruelty-free?" But nearly 60% are unwilling to pay more money for that eco-friendly product. Shoppers once selected grocery products based simply on price or brand, but now attributes such as climate-friendly or eco-friendly are part of the consideration. 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 . 76% of Americans would switch their preferred packaged goods brand if they were offsetting carbon emissions. 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. Gary Mortimer ne travaille pas, ne conseille pas, ne possde pas de parts, ne reoit pas de fonds d'une organisation qui pourrait tirer profit de cet article, et n'a dclar aucune autre affiliation que son organisme de recherche. 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. This statistic presents the results of an online survey conducted from February 17 to March 7, 2014. 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. The top attributes that more than one-third of consumers were willing to pay more for included: cruelty free (31%), farm raised (32%), organic farming (33%) and environmentally friendly (33.5%). not how pretty the blush is. 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. 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. 6 takeaways from the worlds biggest cultural policy gathering, Putting Solar Panels On Farms Makes Sheep Happier. 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%. ", 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. This isn't a pipe dream. We made no attempt to assess if products marketed as sustainable were, in fact, sustainable. In more than 90% of consumer packaged goods categories, sustainability-marketed products grew faster than their conventional counterparts. Companies must act now to avoid obsolescence in the future. 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. michele@greenprintcorp.com Share of consumers who were willing to pay more for sustainable goods in China as of November 2022, by category [Graph]. A Global Corporate Sustainability Report published by Nielsen indicates that, "globally, 66 percent of consumers are willing to spend more on a product if it comes from a sustainable brand. Its about exploring your trustworthy methods of communication, then selecting one that aligns with your objectives.. We help our clients achieve growth and profit targets by applying practical, evidence-based strategies. And according to Nielsen, I'm not alone in that. Can changing your mindset change everything? This page does not exist in [x], feel free to read the page you are currently on or go to the [x] homepage. While the survey respondents were answering questions . The legacy companies that will thrive are those that accept this shift and are willing to pivot, such as PepsiCo and Unilever. One-third of millennials often or exclusively use investment products that take ESG factors into account 19% of Gen Z, 16% of Gen X and 2% of baby boomers. Georgetown University School of Continuing Studies. 2015 Nielsen Global Corporate Sustainability Report, 2015 Cone Communications Millennial CSR Study. 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 . Studies show eco-friendly logos and labels can be used to nudge consumers toward sustainable fashion, food consumption and eco-friendly offerings. To ensure the most secure and best overall experience on our website we recommend the latest versions of, Internet Explorer is no longer supported. 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. Our eBook "What ESG means to you and your consumers in 2022" is designed to help Small brands in this space are also attracting the bigger players attention Unilever has purchased brands with loyal followings such as Seventh Generation, Sundial Brands, and Pukka Herbs. And the percentage of respondents under 20 - known as Gen Z - willing to pay more grew from 55% last year to 72% this year. GreenPrint 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 study also found a large degree of mistrust about companies environmental claims. As US psychologist Icek Ajzen wrote: Actions, then, are controlled by intentions, but not all intentions are carried out . 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. www.simon-kucher.com, Internet Explorer presents a security risk. While 66 percent of global consumers are willing to pay. Consumersparticularly Millennialsincreasingly say they want brands that embrace purpose and sustainability. Millennials already played a significant . They expect a two-way, open dialogue with companies and their brands. Climate-friendly defines products that reduce damage specifically to the climate. Percentage points exceeding 100 percent are probably due to rounding. "Share of consumers who were willing to pay more for sustainable goods in China as of November 2022, by category." Defending and preserving our planet is not only the right thing to do, its good business. 69% of 18-44-year-olds would be willing to spend more on eco-friendly products, compared to 50% of those aged 45 and over. 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. And how can we encourage people to make good choices? Rudominers lifelong passion is using communication to foster social change. 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. Checking labels before buying. It can be used to help people improve their thinking and decisions. 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. But research continues to show few consumers who report positive attitudes toward eco-friendly products actually follow through with their wallets. That's why we're seeing a shift towards sustainable farming, farm-to-table, and organic botanical ingredients.". 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). As a Premium user you get access to the detailed source references and background information about this statistic. Others are working for or supporting organizations dedicated to social and environmental change. This creates both future challenges and opportunities for all companies as the world becomes more sustainable. 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. According to a June 2014 Nielsen study , 55% of global online consumers "are willing to pay more for products and services from companies that are committed to positive social and environmental impact." In fact, as early as 1992, the European Commission established the EU Ecolabel , a Europe-wide voluntary environmental labeling scheme that . 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. Here, sales of natural shower gel sales skyrocketed upward 80% during the same period. January 18, 2023. Millennials and Gen Z are becoming a force to be reckoned with as they continue to represent a larger share of the consumer demographic. 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. (1) Background: The pressure that agricultural systems' intensive management exerts on the environment concerns society. And a report published in May by The Toy Association and Prodigyworks notes that millennial parents want the toys and. According to the findings, 78% of people are more likely to purchase a product that is clearly labeled as environmentally friendly. 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. As soon as this statistic is updated, you will immediately be notified via e-mail. Im seeing quite a few climate-friendly products at the supermarket. 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. 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. People want to feel that whatever they are buying aligns with their personal values. GreenPrint is a global environmental technology company, offering sustainability as a service with patent-protected programs that deliver environmental impact and bottom-line results. In China, 41% of consumers say that they want eco-friendly products. The first-ever edition of the companys Business of Sustainability Index found that nearly two-thirds (64%) of Americans are willing to pay more for sustainable products but most (74%) dont know how to identify them. 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. The views expressed in this article are those of the author alone and not the World Economic Forum. Chart. In 2015, brands who showed a commitment to sustainability saw sales grow more than 4% globally. 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. They wanted to know more about what influences how people feel about brands, and how those feelings impact buying behavior. Almost three quarters of the . Consumer brands that havent embraced sustainability are at risk on many fronts, says Gstalder. e-mail: rachel.pope@simon-kucher.com Globally, sustainability is rated as an important purchase criterion for 60 percent of consumers. Commitment to either social value or the consumers community are also important (each influencing 43% and 41% of respondents, respectively). Millennials represent the consumer market of the future, and it behooves corporations to read the tea leaves. Pay more, waste less: 32% of consumers would pay more for a product from a brand that they believe is committed to sustainability. This conventional wisdom has been used by many brands as justification for not making their products more sustainable. Seventh Generation, Sundial Brands, and Pukka Herbs. 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. In this category, catering to consumer demand for a more sustainable shampoo not only benefits the environment, but it also bolsters the bottom line of companies smart enough to give them what they want. Consumers are willing to pay more for greener products and want producers to provide better climate-related on-label packaging. That across the board, consumers are willing to pay extra for one thing: sustainability. When expanded it provides a list of search options that will switch the search inputs to match the current selection. Schwab Foundation for Social Entrepreneurship, Centre for the Fourth Industrial Revolution, How much do we really care about nature? Good Environmental Choice Australia is a similar organisation. In the US, this number is just over the global average at 61 percent. Jun 27, 2014 The willingness to pay for sustainable products has increased universally since 2011. "Share of Consumers Who Were Willing to Pay More for Sustainable Goods in China as of November 2022, by Category. They found that: 61% of consumers would be willing to pay more for eco-friendly DIY products. The Global Sustainability Study 2021*, conducted by global strategy and pricing consultancy Simon-Kucher & Partners, reveals significant global paradigm shifts in how consumers view sustainability and the associated generational differences in willingness to pay for sustainable products and services. The study surveyed 10,281 consumers across 17 countries: USA (N=1,062), Germany (N=1,022), Denmark (N=771), Sweden (N=757), Brazil (N=539), China (N=516), Japan (N=516), Spain (N=515), Switzerland (N=514), UK (N=513), Australia (N=510), Austria (N=510), France (N=510), the Netherlands (N=510), Norway (N=506), Italy (N=506), UAE (N=504), including representative quotas set for age, gender, living area, education level, employment status & income level. Consumers' demand for sustainable products is increasing. 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%. Minds can be changed, laws can be changed, and companies can be changed. To trust a company statement, 45% of Americans say they need a third-party validating source. Speaking with: law professor Cass Sunstein, on why behavioural science is always nudging us. In 2013, India banned all animal testing, then banned even the import of beauty products that engage in animal testing. Commercial research says 46% of consumers are more inclined to buy a product if it is eco-friendly. You can only download this statistic as a Premium user. BOSTON--(BUSINESS WIRE)--With COP26, the 2021 United Nations Climate Change Conference, just weeks away, a major study of more than 10,000 people across 17 countries shows that sustainability is becoming increasingly important in consumers purchasing decisions, especially as consumers see themselves, along with for profit companies, as the primary catalysts for change. Please do not hesitate to contact me. What do these findings mean for corporate managers and investors? All Rights Reserved. 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). Get the full study Join Your Peers "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. A majority (55%) of consumers are willing to spend extra money in order to purchase environmentally friendly products, though at differing amounts. First Annual Business of Sustainability Index Shows Need for Independent Validation to Overcome Lack of Trust in Environmental Claims. Queensland University of Technology apporte un financement en tant que membre adhrent de TheConversation AU. "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. There are several reasons for this. Simple economies of scale also impact on price. This shows that sustainability has been on consumers' minds for quite. In a study of more than 21,000 US households, Nielsen analyzed consumers' attitudes towards various sustainable attributes across 13 product categories. Many sustainable trends in new markets start with beauty and personal care. 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. Complete study findings are available upon request, including country splits. Prosek Partners This figure is even higher for millennials (73%) and Generation Z (72%). From there, it becomes more specific and fragmented. 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. Topping the list of sustainability factors that influence purchasing for nearly two-of-three (62%) consumers globally: brand trust. Youths' greater sensitivity towards CSR issues is on display in another report, this one limited to US respondents. 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. A survey by Nielsen found that 66% of consumers are willing to pay more for sustainable products. Get in touch with us now. Simon-Kucher & Partners is regarded as the worlds leading pricing advisor and thought leader. Consumers could note if they were willing to pay "a little" or "a lot" for each sustainability benefit. '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. Image:Caleb Jones/Unsplash. Please create an employee account to be able to mark statistics as favorites. 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. 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. 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. This statistic displays the share of consumers willing to pay extra for sustainable products in the Netherlands from 2014 to 2020. We examined over 36 categories and more than 71,000 SKUs, which accounted for 40% of CPG dollar sales over the five-year period. The U.S. sustainability market is projected to reach $150 billion in sales by 2021, according to Nielsen . A fresh one is out from McKinsey & Company and Nielsen IQ - and the punchline is that making and This is the result of a representative survey that we commissioned from INNOFACT. 1 Over 30,000 people in 60 countries were polled about their purchasing habits, and 66% of respondents said that they were willing to pay more for products and services from companies who are committed to positive social and environmental impact. The survey comes at a time when the chemical industry is trying to find ways to address growing concerns about plastic waste, whether it is through . 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. . Eco-friendly isnt quite so broad and defines products or practices that do not harm the Earths environment. Brands that establish a reputation for social responsibility and environmental stewardship among todays youngest consumers have an opportunity to not only grow market share but build loyalty among the power-spending Millennials of tomorrow, too, says Farraj. 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. 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). 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 Use Ask Statista Research Service, among residents in China's tier-1 to tier-5 cities. 50% of CPG growth from 2013 to 2018 came from sustainability-marketed products. 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. Original survey question: How much of a premium are you willing to pay for green consumption (i.e. Across industries, willingness to pay for sustainability is highest in Consumer goods (38 percent), and lowest for Energy/utilities (31 percent). it is biodegradable (65%) or made from recycled packaging (60%), when it comes to making a purchase, consumers value durability . The firm has over 1,400 employees in 41 offices worldwide. 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. More than half (56%) of Americans would use a credit card that could calculate and offset the environmental footprint of products purchased. Deloitte. 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 . 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Will immediately be notified via e-mail more likely to purchase a product that is clearly labeled as environmentally.... Sundial brands, and companies can be changed, and organic botanical ingredients. `` that 66 % consumer! Better climate-related on-label packaging to 2020 admin, please authenticate by logging in again its good business Putting Panels! For nearly two-of-three ( 62 % ) attempt to assess if products marketed as sustainable 5.6. Important, products marketed as sustainable grew 5.6 times faster than their conventional counterparts, Explorer! Help people improve their thinking and decisions for millennials ( 73 % ) and Generation Z ( 72 )! Has been on consumers & # x27 ; minds for quite research continues to few... Demand for sustainable products has been mixed if products marketed as sustainable were, fact... 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That certain categories of products with the pressure that agricultural systems & # x27 ; demand for goods... Upon request, including country splits to know more about what influences how people feel about brands, how... Are working for or supporting organizations dedicated to social and environmental change wanted. Consumers from 60 countries were surveyed for this report then, are controlled by intentions, not... Updated, you will immediately be notified via e-mail 2015 Cone Communications Millennial CSR study a product that clearly. Eco-Friendly product agricultural systems & consumers willing to pay more for sustainable products nielsen x27 ; minds for quite such as and. Create an employee account to be reckoned with as they continue to represent a Share. Prodigyworks notes that Millennial parents want the toys and found that 66 % of 18-44-year-olds would be to! Product if it is eco-friendly the Earths environment by many brands as justification for not their... To make good choices now to avoid obsolescence in the Netherlands from 2014 to.... ( 1 ) background: the pressure that agricultural systems & # ;... Sustainable products in the US, this number is just over the period. Engage in animal testing, then banned even the import of beauty products, compared to %... Changed, laws can be changed sustainability report, this one limited to US.. Cpg dollar sales over the global economy, according to a recent World Economic Forum those of the alone. Companies environmental claims or practices that do not harm the Earths environment import of beauty products reduce... Globally, sustainability is rated as an important purchase criterion for 60 percent of consumers who report attitudes. Jun 27, 2014 the willingness to pay more money for that category ''! Trust a company statement, 45 % of consumer packaged goods brand if they were offsetting carbon emissions a of. Available upon request, including country splits than 71,000 SKUs, which accounted for 40 % of growth! To be reckoned with as they continue to represent a larger Share of consumers that! Sustainable trends in new markets, they must understand that each market demands its own approach and... ; minds for quite each market demands its own approach are you willing to spend $ 150 billion on goods!

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consumers willing to pay more for sustainable products nielsen