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Majority of Online Consumers Will Pay More for Sustainability

From Edie Energy, Published 19 June 2014

Consumer appetite for sustainable brands is growing as new research reveals that more than half of online shoppers are prepared to pay a premium for socially responsible products and services.

A study by Nielsen found that 55% of online consumers across 60 countries were willing to pay more for products and services provided by companies that are committed to positive social and environmental impact.

The propensity to buy socially responsible brands is strongest in Asia-Pacific (64%), Latin America (63%) and Middle East/Africa (63%). The numbers for North America and Europe are 42% and 40% respectively.

According to the study, more than half of respondents have purchased at least one product or service in the past six months from a socially responsible company, with respondents in Latin America (65%), Asia-Pacific (59%) and Middle East/Africa (59%) exceeding the global average. Four in 10 respondents in North America and Europe say they have made a sustainable purchase in the past six months.

Packaging was singled out as an important purchasing decision in this regard - 52% of green purchasing decisions were partly dependent on the type of packaging used.

Loud and Clear

The results from a March 2014 year-on-year analysis showed an average annual sales increase of 2% for products with sustainability claims on the packaging, and a lift of 5% for products that promoted sustainability actions through marketing programmes. In contrast, a review of 14 other brands without sustainability claims or marketing demonstrated a sales rise of only 1%.

Commenting on the findings, Nielsen's global leader of public development & sustainability Said Fenton said it was no longer questionable whether or not consumers care about social impact.

"Consumers around the world are saying Clear that a brand's social purpose is among the factors that influence purchase decisions. This behaviour is on the rise and it provides opportunities for meaningful impact in our communities, in addition to helping to grow share for brands," she said.

In addition to this piece of research, Natural Marketing Institute - a Nielsen strategic business collaborator - conducted an online study across nine countries to understand how global attitudes and behaviours about sustainability engagement are changing. Consumers were clustered into five segments to quantify what attracts them to sustainability actions.

The findings revealed that two-thirds of the 'sustainable mainstream' population will choose products from sustainable sources over other conventional products. These consumers will buy as many eco-friendly products as they can, and have purposefully changed their behaviour to minimise their own impacts.

Additionally, these consumers are more likely to buy products repeatedly from a company if they know the company is mindful of its impact on the environment and society.

Suggested additional reading about sustainable brands:

Sustainability Trends Impacting Firms Across Industries
How the Retail Industry is Adapting to the Sustainability Agenda
Constructing Sustainable Business Models