Consumers willing to pay more for sustainable products
Consumers across Australia, New Zealand, and several other regions have demonstrated a willingness to pay more for sustainable household products, although scepticism about the authenticity of corporate sustainability claims remains a significant issue.
Blue Yonder has unveiled findings from its fourth annual Consumer Sustainability Survey, which involved over 5,000 participants in Australia, New Zealand, France, Germany, the UK, and the US. The survey reveals that a majority of consumers are inclined to consider sustainability when making purchasing decisions, particularly for everyday items such as food and beverages, cleaning products, and beauty items. Conversely, fewer consumers are inclined to pay a premium for higher-cost occasional purchases like electronics and automobiles.
"It's promising to see consumers are ready to align their habits with sustainability as its importance grows, and we hope this enthusiasm will translate to lived behaviours," said Saskia van Gendt, Chief Sustainability Officer at Blue Yonder. She emphasised the responsibility of brands to substantiate their sustainability claims with concrete evidence.
The survey data highlights that 78% of the respondents consider sustainability important when choosing products or retailers. This sentiment is most pronounced among younger age groups such as Gen Z and Millennials, who account for 88% and 86% respectively, while Gen X and Baby Boomers are somewhat less motivated by sustainability in their purchasing choices.
The perception of high costs poses a barrier for consumers aiming to make sustainable choices. Approximately 54% of respondents indicated that the increased costs of sustainable products act as a deterrent. Respondents are, however, more willing to absorb these costs in categories such as food and beverage (48%), cleaning products (37%), and personal care and beauty (30%), rather than more expensive purchases.
Lesley Simmonds, Vice President of Industry Strategy – Retail at Blue Yonder, noted, "Our respondents are sending a message that ethical sourcing and clean ingredients matter when it comes to food, cleaning products, beauty, and clothing. Retailers in these categories can gain a clear competitive advantage and grow their business if they execute with credibility, affordability and convenience in mind."
Nearly half of the consumers indicated willingness to pay between 5% to 9.9% more for sustainable products, with a smaller percentage ready to pay up to 20% more. Nonetheless, a significant proportion, particularly Baby Boomers and those in regions like ANZ, remain resistant to paying additional premiums for sustainability.
The survey found a notable mistrust in brand sustainability claims, with only 20% of consumers believing the accuracy of such marketing. Trust levels are highest in France and the US but considerably lower in ANZ.
About a quarter of those surveyed expressed scepticism towards these claims, with some highlighting a tendency of brands to use sustainability as a trend without genuine action. On a more positive note, 55% of respondents stated they could sometimes trust brands, depending on specific factors.
Further survey insights reveal that consumers are open to allowing additional delivery days for sustainable purchases. They also have varied opinions on who is primarily responsible for sustainability, with a near-equitable split between brands, government agencies, and a shared responsibility among all stakeholders.
Regarding technology, opinions on the impact of AI on sustainability are divided. While a portion holds hope for innovative solutions, others remain unconvinced of its potential benefits or concerned about potential adverse effects.
Commenting on the findings, Saskia van Gendt said, "Our survey findings indicate that sustainability can be a competitive advantage and drive growth for brands." She stressed that utilising technology for claims validation and ensuring transparency in supply chains could enhance brand credibility regarding sustainability.
