Survey: consumers set price cap on paying sustainability premium

Consumers are still committed to shopping sustainably even as their budgets tighten under the pressure of rising inflation and interest rates, but a study from Blue Yonder shows that most shoppers have a strict limit for how much extra they’re willing to pay for it.

Survey results show that consumers are willing to make personal sacrifices—such as paying more and delaying priority shipping—for more eco-friendly shopping, according to a February 17-19 survey of more than 1,000 U.S. consumers commissioned by the Arizona-based supply chain software vendor.

In fact, 69% said they were willing to pay more for sustainable products, and 78% would wait up to a week for a delayed delivery in favor of an environmentally friendly shipment, such as items sent at a deprioritized, eco-conscious shipping speed. However, that offer only goes so far. Most respondents said they were willing to pay only up to 5% more to gain that sustainability, and just 4% said they would pay 20% more.

Certain product categories also attracted more sustainable spending, with consumers saying they were most amenable to paying a premium for eco-friendly products that would heavily impact their day-to-day lives, led by apparel (30%), cleaning products (27%), and beauty products (19%). But 58% reported that price was still the most important factor in determining whether to make a sustainable purchase.

Although consumers see the importance of sustainable practices, they are skeptical that brands are reporting that progress honestly. More than half of respondents (56%) were indifferent or were not sure whether they could trust brands’ sustainability claims related to their manufacturing, supply chain, or recycling/waste practices. Rather than taking corporations at their word, consumers are more interested in hearing from their peers, with a plurality of survey respondents (32%) indicating that consumer reviews carry the most weight in their green purchasing decisions. Even with more official designations like ESG (environmental and social governance) ratings, consumers are not sold – just 14% said ESG scores were the most important determinant, and 50% were unfamiliar with ESG scores altogether.

“The survey results tell us loud and clear that brands must walk the walk, and consumers rely heavily on each other to vet corporate ESG claims,” Ed Wong, senior vice president, global retail sector leader, Blue Yonder, said in a release. “The past year has also demonstrated that consumers remain sensitive to prolonged inflation, with marked shifts in their willingness to spend and a clear trend in favor of shopping secondhand. As consumers navigate and weigh their options for more environmentally-conscious shopping, we can expect to see these patterns continue across retail channels.”

The survey also found that shoppers were willing to practice certain eco-conscious habits mostly with specific products. For example, of all the consumer goods that could be purchased secondhand, shoppers ranked their willing to buy used items mostly for household furniture and appliances, apparel, or consumer electronics. Likewise, consumers said they would consider switching their loyalty to a more sustainable brand mostly for certain categories, led by household products (65%), food products (57%), and beauty & wellness (49%).