Green Products Going Strong Despite Economy, Studies Find
It's true, as GreenBiz.com executive editor Joel Makower wrote last month, that even during rough economic times like these, marketers' surveys of consumers almost always report exceedingly optimistic returns of how likely shoppers are to choose green products.
Whether or not that assessment is true, three new reports out in recent days certainly continue the trend: reports from Forrester Research, the Carbon Trust Standard and IRI find anywhere from 15 to 62 percent of shoppers in the U.S. and U.K. take environmental considerations to heart before they purchase a product or service.
The Forrester survey asked over 5,400 U.S. residents about how they shop, and whether they're willing to pay a premium for a green or socially responsible product and finds a small but notable minority willing to shell out: between 61 and 72 percent said they were influenced by socially responsible or environmentally friendly elements of a product, although just 18 and 15 percent would pay extra for each respective type of product.
"Despite the fact that nearly one in five U.S. consumers thinks that the "green" movement is just a fad, the portion of consumers who will pay for products and buy from companies that are environmentally and socially responsible is not trivial," writes Sally M. Cohen, the report's author. "What's more, these consumers are a lucrative group, both in the short term -- they are willing pay more for green and ethically produced products -- and in the long term, as they are brand-loyal shoppers and will stick with companies that continue to support their own ethical agendas."
As a result, Cohen explains, putting green at the top of product requirement lists -- as well as marketing materials -- can lead to product differentiation, incremental revenues from those customers paying a premium for green products, and brand loyalty who identify with products that share the same values of those shoppers.
The study from IRI, "Sustainability: CPG Marketing in a Green World," looks at the growth or shrinkage in green product purchases from eight groups of shoppers, ranked by their commitment to the environment. Although the overall market for green products grew by 4.1 percent between 2008 and 2009, IRI's top-level green market segment, the "Eco-Centrics," spent the same amount on green products in 2009 as in the previous year.
The growth in green came instead from two segments slightly further down the chain: IRI's "Respectful Stewards" and "Proud Traditionalists" segments spent 14.8 percent and 15.2 percent more, respectively, than in 2008.
As in the Forrester study, packaging played a significant role in purchase decisions, and among of the recommendations from IRI's researchers is to "identify opportunities to reduce packaging and leverage recycled and/or earth-friendly materials" and to "leverage high-visibility packaging enhancements, where possible."
The final of the surveys comes from the Carbon Trust Standard, which found among adults in the U.K. much the same results as among U.S. residents: 66 percent of consumers said they believe it's important to buy from environmentally responsible companies, and 14 percent also said they had "voted with their feet" and not bought a product from a company based on their environmental reputation.
"This research shows that consumer values do not change, even in a middle of a recession," said Harry Morrison, head of the Carbon Trust Standard. "They want companies to act and cut their carbon footprints, and provide transparent and accessible evidence of action. We believe companies that take real action will seize the dual benefits of immediate cost savings and a stronger reputation, which is good for business."
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