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. So it appears that some categories that are behind in sustainability-marketed product share are making up for lost time. 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%. 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. 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. 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. More demand would mean more production and lower unit price costs. This figure is even higher for millennials (73%) and Generation Z (72%). A new report reveals all. "Share of consumers who were willing to pay more for sustainable goods in China as of November 2022, by category." But nearly 60% are unwilling to pay more money for that eco-friendly product. 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. 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. 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. (1) Background: The pressure that agricultural systems' intensive management exerts on the environment concerns society. Millennials are the most willing to pay extra for sustainable offeringsalmost three-out-of-four respondents (73%), up from approximately half in 2014. 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. Academic research has consistently identified this gap between purchase intentions and behaviours. to incorporate the statistic into your presentation at any time. Consumer-goods brands that fail to take this into account will likely fall behind.. 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). Even toys can get the climate-friendly treatment. Says Gstalder: While marketing good deeds is encouraged and expected by consumers, authenticity and credibility are essential. Voir les partenaires de TheConversation France. Products with a sustainability claim have continued to drive growth amid the pandemic, according to a new report from IRI and the NYU Stern Center for Sustainable Business. 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 . 470-788-0718 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. e-mail: rachel.pope@simon-kucher.com 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 . Climate Explained is a collaboration between The Conversation, Stuff and the New Zealand Science Media Centre to answer your questions about climate change. 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. IRIs data comes from bar scan codes at retail checkout in food, drug, dollar, and mass merchandisers. Those that had no such commitment grew less than 1%. Climate-friendly defines products that reduce damage specifically to the climate. For further information please contact: This statistic presents the results of an online survey conducted from February 17 to March 7, 2014. This page does not exist in [x], feel free to read the page you are currently on or go to the [x] homepage. When expanded it provides a list of search options that will switch the search inputs to match the current selection. 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. The relative importance of sustainability during the purchase process will continue to increase. 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). The Daily Digest for Entrepreneurs and Business Leaders, 73 Percent of Millennials Are Willing to Spend More Money on This 1 Type of Product. Consumers expect more than ever from the brands they buy and increasingly are rewarding companies whose services and products are both good for them and good for society. Register in seconds and access exclusive features. Complete study findings are available upon request, including country splits. In a study of more than 21,000 US households, Nielsen analyzed consumers' attitudes towards various sustainable attributes across 13 product categories. People want to feel that whatever they are buying aligns with their personal values. Original survey question: How much of a premium are you willing to pay for green consumption (i.e. As companies look to break into new markets, they must understand that each market demands its own approach. The hierarchy among drivers of consumer loyalty and brand performance is changing, says Farraj. Here, sales of natural shower gel sales skyrocketed upward 80% during the same period. A survey of 51 retail senior-level . Interestingly, of the people that are willing to pay a sustainability premium, the premium amount is lowest for Consumer goods (22 percent premium on average) it is highest for Financial services (27 percent premium on average). As CPG sales spiked . 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. A fresh one is out from McKinsey & Company and Nielsen IQ - and the punchline is that making and Top Wellness Trends for Emerging Brands in 2023, Leading alcoholic beverage health and wellness trends in the US, The Value of Data and Insights: ROI for Emerging Brands, Do not sell or share my personal information. Consumers also see themselves as the agents of change, implying that the call to action for companies to adapt has never been more urgent. '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. Both are good tools for building trust. In 2018, that number had risen to about 85% . She's vocal about the fact that it costs a lot more than shirts from a company like H&M specifically because she only uses sustainable goods and ethical practices when it comes to the workers. A majority of people have doubts when companies say they are environmentally friendly, with 53% of Americans never or only sometimes believing such claims. This statistic reveals a significant shift in consumer behavior and highlights the importance of sustainability in marketing to this eco-conscious generation. By comparison, 51% of Boomers (ages 50-64) said that they would pay a premium for sustainable products. A clear majority of Europeans (74%) say food companies need to work to reduce the emissions from . 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). Attitudes towards sustainability also vary by industry when measuring its importance as a purchase criterion, from 74 percent in Energy/utilities to 44 percent in Financial services. , Feb 8, 2023. 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. Companies should be aware that consumers are increasingly voting with their dollars against unsustainable brands. 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. While attitudes vary across generations, countries, and industries, 85% of consumers have become greener in their purchasing in recent years. Please create an employee account to be able to mark statistics as favorites. 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 . 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. Consumers care about sustainabilityand back it up with their wallets, Five Ws and one H to mastering your category, Consumer Outlook 2023: The unsettled state of global consumers, Communication led by service advisors helps drive satisfaction with aftersales process in India, Do not sell or share my personal information. 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. This behaviour isn't just limited to the wealthy in big economies. "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. Consumers across regions, income levels, and categories are willing to pay more, if doing so ensures they remain loyal to their values. "Our sustainability. Simon-Kucher & Partners is regarded as the worlds leading pricing advisor and thought leader. 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. As economists say, as price lowers, our willingness and ability to buy an item increase. 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 While the survey respondents were answering questions . 77% of Americans are concerned about the environmental impact of products they buy. More than half of Europeans (51%) said they are willing to pay more for climate friendly food. 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. Get in touch with us now. 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 . While the demand for such products remains low, the price remains high. In 1989, 67% of American consumers stated that they were willing to pay 5 - 10% more for sustainable products. 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. Nielsen combines sustainability into free-from, clean, simple, sustainable and . 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