Monterey, CA: Consumer appetite for green products has increased significantly in the past year, according to findings from the annual ImagePower Global Green Brands Study, one of the largest global consumer surveys of green brands and corporate environmental responsibility.
This year's survey, which polled more than 9,000 people in eight countries, reveals that consumers worldwide intend to purchase more environmental products in the auto, energy and technology sectors compared to last year. Now more savvy about how green choices in personal care, food and household products directly affect them and their families, global consumers are expanding their green purchase interest to higher-ticket items such as cars and technology.
Consumers are divided on which industry currently does the best job of protecting the environment. Eighteen percent of American and 20 percent of Australian consumers say the energy industry does the best job of protecting the environment. By comparison, most of respondents in Germany (19 percent), India (22 percent), China (33 percent) and Brazil (22 percent) cite the technology sector. In the UK, more than 21 percent of consumers say the grocery store industry is the top protector of the environment.
Where consumers are spending
While personal care, grocery and household products are the industries with the greatest representation among the top 10 brands list, consumers in the US indicate that they intend to spend more money on green technology, energy and automotive products or services in the next year.
When it comes to current usage of green products or services, the 2011 study reveals that the household products and grocery categories have the highest consumer adoption rates in all countries except China, where packaged goods/beverages and personal care are the most used categories, and in Brazil, where household products and personal care dominate.
In all countries, consumers indicate that in the coming year they are less likely to buy green packaged goods and beverages, grocery and household products.
"We're seeing a shift in the 'In Me, On Me, Around Me' mentality when it comes to purchasing green products," says Russ Meyer, chief strategy officer of Landor Associates. "Consumers have a good understanding of how green choices in personal care, food and household products directly affect their families, and they are now seeing benefits like costs savings that attract them to higher cost items like cars and technology."
Greater perceived value in developing countries
Consistent with last year's study, more than 60 percent of consumers globally want to buy from environmentally responsible companies. Respondents in all eight countries surveyed indicate that they are willing to spend more on green products. In developed countries such as the US and the UK, roughly 20 percent of those surveyed would spend more than 10 percent extra on a green product.
In developing countries, however, consumers say that green products have a higher inherent value. Ninety-five percent of Chinese consumers say they are willing to spend more on a product because it's green—with 55 percent of them willing to spend between 11-30 percent more. Similarly 29 percent of Indian consumers and 48 percent of Brazilians say they are willing to spend between 11 – 30 percent more on green products.
"Consumers in developing countries express greater concern over the state of the environment in their countries, which may contribute to their greater willingness to pay more for green products," says Paul Andrepont, senior vice president of Penn Schoen Berland. "Consumers in these markets also differ from their developed-nation counterparts in believing that selection, rather than cost, is the greatest barrier to buying green products. Brands that address these consumers' very real concern – over air pollution in India or deforestation in Brazil – have the ability to position themselves as premium in the market, a possible competitive advantage."
Packaging is critical
Packaging continues to be a matter of great concern for US consumers. Seventy-one percent believe companies use too much material in product packaging – though only 34 percent of US consumers say they consciously purchase products that use less packaging. Almost half of American consumers feel that packaging that can be recycled is more important than packaging made from recycled or biodegradable materials.
Packaging also plays a critical role in communicating product benefits to US consumers. More than 50 percent of American consumers say on-pack information helps them understand how green a product is. Additionally, 40 percent say that packaging is their primary source for information on environmental issues regarding products.
"Other than price, the two biggest influences on purchase decisions are on-package messaging and prior experience with the product, both of which satisfy the consumer need to understand a benefit beyond 'saving the world,'" says Annie Longsworth, global sustainability practice leader for Cohn & Wolfe. "It's critical for green brands to communicate the real and tangible benefits of their products in addition to being green, which still feels like luxury to many consumers."
2011 US rankings
For the first time since the inception of the ImagePower Green Brands Study in 2006, the four brands perceived to be the greenest are "born green" companies. The full list includes:
1. Seventh Generation
2. Whole Foods
3. Tom's of Maine
4. Burt's Bees
5. Trader Joe's
6. The Walt Disney Co.
7. S.C. Johnson
10. Starbucks, Microsoft (tied)
"When we analyzed the approach of the top ten brands companies, using our Esty Environmental Scorecard, it was clear that the winners achieve a product-value-information trifecta," says Amy Longsworth, partner at Esty Environmental Partners.
"The top brands offer clear price value through co-benefits: a great innovative product that meets my functional needs plus green attributes that meet my values needs. These companies also tend to have robust life-cycle insight and complete sustainability strategies across their value chains, which enable them to draw from rich experience and data for their consumer communications."