How Much More are Consumers Willing to Pay for Sustainable Products?
Decisions made by businesses are often led by consumer demands.
In a recent study by Nucleus Research, findings show that consumers are willing to spend 6% more for products from companies which have sustainability commitments and programs in place.
Alongside these findings, the research showed that consumers were 64% more likely to recommend companies with sustainable practices to friends and were 63% more likely to try new products from these companies.
As more and more companies begin engaging in sustainability practices in order to gain this competitive advantage and align with changing consumer demands, the quality of these commitments as well as the marketability of these commitments is crucial.
In some industries, sustainable practices are the standard, so it then comes down to the quality of these practices, the extra lengths some companies may go to when it comes to economic, social and environmental sustainability as well as how well these commitments and practices are marketed.
For many consumers, the prioritising of sustainability above cost shows a commitment to the community. This affinity with the sense of belonging suggests to business that their marketing around sustainability should be centred around building a community of buyers.
For instance, in buying from a certain brand, the consumer will join a community of like-minded people who are passionate about creating a sustainable future.
Being able to create these kind of purchasing environments for consumers makes and increase in the dollar-value of a product seem negligible.
However, it is important to point out that a sustainably-sourced and -produced product does not necessarily mean a more expensive product. While the use of ethical resources can at times come with a higher price, especially when it comes to employing workers at a fair wage instead of a wage which is less than a living wage, there are some practices in sustainability which can actually save the cost of production. These include practices such as the use of solar energy and LED lights.
As an increasing number of consumers become not only more aware of the need to play their role in sustainable purchasing decisions but are actively paying an average of 6% more to do so, businesses need to take this journey also.
For more information about creating a sustainability commitment for your business, contact us today!