Majority of U.S. Consumers Will Pay More for Sustainable Products
Gen Z, millennials and parents are particularly supportive of environmentally friendly companies.
ATLANTA — Inflation and economic uncertainty may be challenges to many consumers, but more than two-thirds of Americans (68 percent) are still willing to pay more for environmentally sustainable products than their competitors that are not sustainable, according to the third Business of Sustainability Index (BOSI) by PDI Technologies Inc.
Data shows steady growth in demand for sustainability across the United States, as the percentage of customers willing to pay for their values keeps growing: 64 percent of Americans said they would pay more for sustainable products in BOSI 2021 and 66 said the same in BOSI 2022.
Young people are particularly open to paying for sustainable products, as 77 percent of Generation Z and 72 percent of millennials said they would do so. Parents are also ready to pay for sustainability, with 76 percent reporting they would pay more.
When it comes to gasoline, 64 percent of Americans said they would pay more at the pump if carbon emissions were offset with sustainability efforts such as planting trees. That figure rose even higher for Gen Z (76 percent), millennials (67 percent) and parents (74 percent).
"Over the past three years, BOSI has measured Americans' accelerating demand for sustainability to help companies better understand how to meet those evolving needs," said Brandon Logsdon, president of consumer engagement, PDI Technologies. "The data is clear: Consumers overwhelmingly want sustainable products and are willing to pay more for them. Companies that understand sustainability as a strategic business asset are well positioned to gain market share and grow faster than their competitors."
Despite their preference, while 79 percent of Americans say they want to buy from brands that are environmentally friendly, most of them don't know how to identify such companies. This is particularly true for Gen Z (91 percent), millennials (80 percent) and parents (85 percent).
Data also shows a growing dissatisfaction with how companies approach sustainability. Forty-five percent of consumers believe American corporations are doing a poor job when it comes to reducing their carbon footprint and the footprint of the products or services they sell, up from 41 percent in BOSI 2022. Additionally, 37 percent of Gen Z wants corporate profits to support environmental organizations, a nine-point increase over all respondents (28 percent).
"Consumers want sustainability but struggle to find it. Even when they do, they often don't trust the environmental claims companies make. Leveraging internal tools and third-party accreditation to help measure, track, and communicate progress will continue to differentiate the sustainability gains of their products, services, and overall enterprises," Logsdon said.
PDI software is designed to help businesses and brands increase sales, operate more efficiently and securely, and improve critical decision-making. More than 1,500 companies, representing more than 200,000 locations worldwide, use PDI solutions.