Updated: Aug 3, 2020
When you work in the field of sustainability, it is easy to find yourself in an echo chamber of eco-activists, influencers, sustainable product owners, sustainable lifestyle bloggers, and climate scientists. But have you ever needed to make the business case for sustainability? Need some stats for those who dismiss sustainability as a trend? This article is for you our eco-warrior friend.
We are here to show you how and why sustainability DOES sell (we promise we aren’t just saying this because we are a green start-up ourselves *cough cough*).
So firstly, what exactly defines a “good product” to most people? Traditionally, it was a combination of convenience and value. But this is no longer the case...
Today, when shoppers buy a product, they are looking for brands that align with their personal values, whether it be political, environmental, or cultural. While this may not have been commonplace behaviour in the past, today it has become important to know what exactly you are purchasing and what that company stands for.
Dr. Matt Johnson, professor at Hult International Business School and founder of neuromarketing blog Pop Neuro, says, "There is accumulating evidence that consumers are impacted by the perceived sustainability of a brand, and further, that consumers are willing to pay a premium for products from a sustainable brand over a non-sustainable competitor brand."
In the face of climate change, those of us who care enough are certainly prepared to alter our shopping habits in favour of the more environmentally-friendly option.
A 2019 survey led by Hotwire found that 47% of internet users worldwide had ditched products and services from a brand that violated their personal values. Protecting the environment topped that list.
NYU Stern’s Center for Sustainable Business also recently completed extensive research into U.S. consumers’ actual purchasing of consumer packaged goods (CPG), finding 50% of CPG growth from 2013-2018 came from sustainability-marketed products.
Meanwhile, Harvard Business Review conducted research finding that products with a sustainability claim on-pack accounted for 16.6% of the market in 2018, up from 14.3% in 2013, and delivered nearly $114 billion in sales, up 29% from 2013. Most importantly, products marketed as sustainable grew 5.6 times faster than those that were not. In more than 90% of the consumer packaged good categories, sustainability-marketed products grew faster than their conventional counterparts.
Need further convincing?
In 2018, Nielsen conducted a study that found that nearly half (48%) of U.S. consumers say they would definitely or probably change their consumption habits to reduce their impact on the environment. These consumers are putting their dollars where their values are, spending $128.5 billion on sustainable fast-moving consumer goods (FMCG) products this year.
Since 2014, these influential shoppers have grown sustainable product sales by nearly 20%, with a compound average growth rate (CAGR) that’s four times larger than conventional products. By 2021, we expect these sustainably minded shoppers to spend up to $150 billion on sustainable FMCG goods an increase of between $14 billion to $22 billion.
The future bodes well for the corporate side of the sustainability industry on the whole, with a market research report from 2019 Green Technology and Sustainability Market, claiming that there will be projected growth from US $8.7 billion in 2019 to US $28.9 billion by 2024, at a Compound Annual Growth Rate (CAGR) of 27.1% during the forecast period. The major factors driving the growth of Green Technology and Sustainability Market include increasing environmental awareness and concerns, along with increasing consumer and industrial interest for use of clean energy resources to conserve the environment.
There ya have it. Sustainability sells! Please feel free to use any and all of this article to help spread the news - whether you need to justify a little more budget for sustainable initiatives, win over an investor, or take the leap into a new sustainable segment.
… and if you’re a company looking to implement sustainability initiatives, we have a little something for you! We are currently recruiting organisations that would like to use ‘Capture for Teams’ enabling the tracking of CO2 emissions from everyday mobility choices. We can help you engage employees in the sustainability agenda, whilst gathering really useful data on mobility-based emissions.
Please email us to find out more at firstname.lastname@example.org