Nielsen reported in 2014 that half of young consumers were willing to pay more for sustainable products. This creates both future challenges and opportunities for all companies as the world becomes more sustainable. 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. . Simon-Kucher & Partners, Strategy & Marketing Consultants: Simon-Kucher & Partners is a global consulting firm specializing in TopLine Power. They expect a two-way, open dialogue with companies and their brands. Overall, consumers identified . You can unsubscribe at any time using the link in our emails. Sustainability sentiment is particularly consistent across income levels. 9. Feb 28, 2023. I don't dream of a world with 99 cent hamburgers available at any roadside fast food place. 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. 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. 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. The Nielsen Global Survey on Corporate Social Responsibility polled more than 29,000 Internet respondents in 58 countries. 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 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. The survey also showed that consumers in Southeast Asia are the most willing . 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. For this group, personal values are more important than personal benefits, such as cost or convenience. New York-based Nielsen forecasts the market to reach somewhere between $142.4 billion and $150.1 billion by 2021. Chart. Consumer brands that havent embraced sustainability are at risk on many fronts, says Gstalder. 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. GreenPrint, A Public Benefit Corporation, is on pace to offset over 30 million metric tons of carbon by 2025. People want to feel that whatever they are buying aligns with their personal values. As companies look to break into new markets, they must understand that each market demands its own approach. statistic alerts) please log in with your personal account. Get the full study Join Your Peers To ensure the most secure and best overall experience on our website we recommend the latest versions of, Internet Explorer is no longer supported. As a result, many consumers have adopted more sustainable behaviors. They are willing to rethink their buying habits to incorporate environmental and social product benefits into their buying decisions. We examined over 36 categories and more than 71,000 SKUs, which accounted for 40% of CPG dollar sales over the five-year period. Companies must invest, innovate and transform their business models now to protect their long-term profitability and viability. 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 . .chakra .wef-facbof{display:inline;}@media screen and (min-width:56.5rem){.chakra .wef-facbof{display:block;}}You can unsubscribe at any time using the link in our emails. When browsing beauty products, my first question is, "Is it cruelty-free?" More than half of Europeans (51%) said they are willing to pay more for climate friendly food. As soon as this statistic is updated, you will immediately be notified via e-mail. Create a free account and access your personalized content collection with our latest publications and analyses. Simon-Kucher & Partners is regarded as the worlds leading pricing advisor and thought leader. By comparison, 51% of Boomers (ages 50-64) said that they would pay a premium for sustainable products. . 77% of Americans are concerned about the environmental impact of products they buy. Can changing your mindset change everything? not how pretty the blush is. And companies with strong reputations outperform others when it comes to attracting top talent, investors, community partners, and importantly, consumers.. 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 . Sixty-six percent of consumers say they are willing to pay more for sustainable brandsup from 55% in 2014 and 50% in 2013. 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. 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). 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).. What is the World Economic Forum doing about the circular economy? To trust a company statement, 45% of Americans say they need a third-party validating source. 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. Droits d'auteur 20102023, The Conversation France (assoc. In 2013, India banned all animal testing, then banned even the import of beauty products that engage in animal testing. Jun 27, 2014 The willingness to pay for sustainable products has increased universally since 2011. 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. Looking at web sites for information on business and manufacturing practices. Products that we deemed sustainability-marketed in 2018 were considered sustainability-marketed in 2013 too, as we were unable to examine 2013 packaging for all products. [Online]. It can be done. In one survey, 66% of all respondents, and 75% of millennial respondents, said they consider sustainability when making a purchase. Are consumers really willing to pay more for sustainable products? Nudge theory is used to understand how people think, make decisions and behave. Checking labels before buying. 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 . Committing to sustainability might just pay off for consumer brands, according to the latest Nielsen Global Corporate Sustainability Report. Share of consumers who were willing to pay more for sustainable goods in China as of November 2022, by category [Graph]. For example, the climatop label certifies products that generate significantly less greenhouse gas than comparable products. Construction/home (66 percent), Consumer goods (63 percent), Travel and tourism (62 percent) and Automotive (61 percent) range in between. 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. In a study byHorizon Medias Finger on the Pulse, 81 percent of Millennials expect companies to make a public commitment to good corporate citizenship.. 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. 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. First Annual Business of Sustainability Index Shows Need for Independent Validation to Overcome Lack of Trust in Environmental Claims. 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. Given that sustainability issues vary by category, we also assessed whether a claim concerned a material environmental or social issue for that category. In a free market economy, it is very difficult to force people to pay more for products. 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