The short answer? Yes, they do! Study after study has shown that consumers around the world are increasingly aware of sustainability, and that this drives their behavior. We spoke to Claudia Suárez-Gapp from the performance management company Nielsen about the latest trends, and what they mean for your brand.
“It all comes down to trust,” says Claudia Suárez Gapp, whose company, Nielsen, has recently released a major study called “The Sustainability Imperative”, for which it surveyed 30,000 consumers in 60 different countries. “The research shows that trust in a company or brand is the greatest single purchase driver for consumers, and a commitment to sustainability is increasingly how you can earn that trust,” she says.
This confirms the findings of previous research. For example, according to a study by Cone Communications, 91% of consumers in the world’s biggest economies expect companies to do more than make a profit, and to operate responsibly to address social and environmental issues.
Sustainability boosts sales
The research suggests that consumers weigh up sustainability alongside more traditional factors like price and quality.
The Nielsen study shows that the number of consumers willing to pay more for brands committed to positive and social impact continues to rise: 66% of us in 2015, up from 55% in 2014 and 50% in 2013.
For a growing proportion of consumers, sustainability is even more important than quality. According to the Cone study, 90% are likely to switch brands to one associated with a good cause given similar price and quality, while 57% percent would purchase a product of lower quality if it was more socially or environmentally responsible. 80% would be willing to buy a product from an unknown brand if it had strong social and environmental commitments.
Impact on the bottom line
It’s clear that people say they are committed to sustainability, but what does that mean for the bottom line? “Our study looked at more than 1300 brands in 13 categories across 13 markets,” says Claudia from Nielsen, “and we found that brands with a demonstrated commitment to sustainability saw more than 4% sales growth, while those without grew less than 1%.”
We found that brands with a demonstrated commitment to sustainability saw more than 4% sales growth, while those without grew less than 1%.
The age effect
As you might expect, the research shows that younger people are more likely to care about sustainability. The Nielsen study shows that millennials (those born from the mid-1980s to early 1990s) are most willing to pay extra for sustainability: almost 3 out of 4, up from roughly half in 2014.
However, “we mustn’t forget the baby boomers!” says Claudia. “Our research shows the same trend across all age groups. Millennials might be leading the way, but the proportion of sustainability-conscious consumers of every age group is growing year on year.”
Sustainability is the new base line
As sustainability becomes more important to more consumers, social and environmental responsibility is becoming a new baseline for trusted brands – sustainability is becoming the norm. “In some developed markets, it’s no longer about marking yourself out as ahead of the curve, but rather ensuring that you don’t fall behind,” says Claudia.
In some developed markets, sustainability is no longer about marking yourself out as ahead of the curve, but rather ensuring that you don’t fall behind.
That shows up in the studies, with consumers making it clear they favor sustainable brands, but they also actively avoid those who do not take action. The Cone study shows that 90% would boycott a company if they learned of irresponsible or deceptive business practices. Taking action on sustainability becomes a vital step to protect your reputation.
Another major piece of research by Havas Media Group even indicated that trust alone is no longer enough; rather, consumers are looking for a sense of ‘meaningfulness’. They want brands to improve their own lives, the lives of people they care about, and global society.
What this means for your brand
Clearly, consumers expect you to take action on sustainability. What you do and how you communicate it will depend on your brand values and customer profile. Some consumers are prepared to pay more or change their behavior, while many are simply looking for reassurance that they don’t need to stop buying the brand they know and love.
Define your brand’s sustainability benefit. Consumers are looking for a unique, credible story that resonates with your brand values.
Claudia Suárez-Gapp from Nielsen advises that you clearly define your brand’s sustainability benefit, and determine which type of communication is most compelling for your specific customer group. “It’s not about a one size fits all approach,” she says. “Instead, consumers are looking for a unique, credible story that resonates with your brand values.”
Explore the Better Business Hub and find inspiring ways to connect with consumers.
Listen to our recent webinar ‘Consumer expectations & how to grow with sustainability‘ with insights from the Nielsen report shared by guest speaker Rachael Noon. You can also download the handout of the presentation.
Or simply get in touch to discuss your ideas – we’re here to help!