Simply providing a high-quality product no longer cuts it. Consumers are increasingly searching for products and brands that align with their own values.
What's more, the thought of possessing voting power through their purchase decisions is appealing to shoppers; this could mean consciously opting for or boycotting a particular brand. For your company, this could either be good or bad news - it all depends on your sustainability strategy.
Here we'll discuss what the research says about the link between products with a green edge and consumers, what the finance says, and why, in the end, communication is of the essence.
What the Research Says
Between 2013 and 2018, 50% of the increase in the consumption of consumer packaged goods (CPG) consisted of sustainable products. This was according to research done by the IRI (U.S. data analytics and market research company).
It was also discovered that products marketed as being eco-friendly expanded 5.6% more quickly than their non-sustainable counterparts.
Clearly, even in 2018 sustainability was an important issue among consumers.
In fact, did you know that consumers actually want companies to help them purchase and live more environmentally-consciously? According to Forbes, 88% of those surveyed in the U.S. and the UK would like companies to help them transition to a more sustainable lifestyle.
88% of those surveyed in the U.S. and the UK would like companies to help them transition to a more sustainable lifestyle
It seems that customers are willing to take the next steps and are simply waiting for companies to take action.
Let's Talk Money
So, obviously your target market cares greatly about this subject. But, what does it mean for your bottom line?
No one is saying that switching to a more sustainable business model is easy. Nor is it necessarily cheap. However, taking little steps can be just as effective as tackling the project all at once.
Still, you may be thinking: Yes, there's an interest from consumers, but is it financially worth it for my small business?
According to IBM, 57% of individuals would be willing to change their shopping behaviors in the name of the environment. Not only that, but 70% of consumers, for whom sustainability is very or extremely important, would be willing to pay a 35% premium for eco-friendly products.
Just think about that. Customers are, in fact, willing to give out more cash for items that are better for the environment.
70% of consumers, for whom sustainability is very or extremely important, would be willing to pay a 35% premium
Tied into the overall topic of greener products are transparency and traceability. IBM's data indicated that product traceability is a concern for 73% of consumers. Again, here it was discovered that shoppers would be willing to pay a premium, namely 71% of them would spend extra money for overarching transparency about the origins of their products.
Communication is Key
Authenticity appears to be highly valued, This additionally creates brand trust, which happens to be another determinative factor.
84% of consumers consider this aspect to be crucial (Gen Z shoppers place the least focus on brand trust), meaning communicating your business' core message and values effectively across all markets is of utmost importance.
“How companies communicate with consumers has an enormous influence on the adoption of sustainable behaviors.” -Harvard Business Review
Speaking directly to consumers in their native language builds a connection between your brand and them.
That's why understanding cultural norms and the local language is even more important when propagating a message of sustainability. The key is producing content that strikes a chord with your potential customers.
According to the Harvard Business Review, social factors play a large role. Merely the act of mentioning that other like-minded consumers purchase sustainable products increases the likelihood of a sustainable purchase by 65%.
In short, social influence is a powerful tool. In order to fully leverage this, your company must ensure your brand's message is foolproof in the target market and culture, whether it be the USA, Germany, or China.
Sustainable development is beneficial for your company and consumers are waiting for you to take action.
You can take small steps to transition to a greener business and some customers are even willing to pay up to a 35% premium for sustainable products.