The priorities, intentions and needs changing over time
Consumers often say that they will pay more for sustainable products and services, but then don’t support that intention with action. As the world slowly emerges from the pandemic, there are signs this gap will close. That would create a major growth opportunity for consumer-facing companies, if they are ready to transform now to seize it. In particular, they need to create products that reflect the nuanced concerns of target consumers, and they need to make sure the business operations behind the brand meet those expectations too.
That requires a detailed understanding of the way the experience of the pandemic is reshaping attitudes to sustainability. As the Index shows, what consumers value and which values they are prepared to actually pay for varies across countries, categories, and segments. These differences are nuanced, complex and often paradoxical.
- 53% of Gen Z and Millennials say that sustainability is important when making purchase decisions, an equivalent proportion also agrees that it costs too much to purchase sustainable products.
- 61% of Gen Z and Millennials consider the amount of packaging when buying products, but an equivalent proportion also agrees that they want more packaging to protect them from the risk of infection.
- 68% of Gen Z and Millennials want more information to help make better sustainable choices while 30% agree to have checked or validated sustainability claims made on packaging or in advertising in the last six months.
More consumers, especially those in Gen Z and Millennials, want to buy sustainably, but they need companies to make that possible for them. Even when this is the situation, most of them find it difficult to afford to pay more for sustainability; price remains their number one purchase criteria. And many of them who are willing to make more sustainable choices don’t have access to products that reflect their changing values. To succeed, CEOs need to make sustainability accessible to more consumers.
What and why do Gen Z and Millennials care about sustainability?
Certainly, the COVID-19 pandemic has not spared any age group, ethnicity, or gender; however, the nature of the impact varies across different age groups. Each group has faced different challenges during the pandemic, which will likely shape their perspectives and expectations of the “new normal” that will emerge.
Gen Z and Millennials expect the pandemic to increase awareness of climate change, triggering governments and businesses to take more decisive action. Many anticipate local- and city-level vs. national and international cooperation to tackle this challenge. However, some felt the pandemic and resulting economic fallout would lead governments to de-prioritize climate change initiatives.
The pandemic’s simplified household consumption patterns will continue, with a permanent reduction in spending on luxuries and travel. This is a part of an embrace of a simpler, more sustainable lifestyle, while some of the Gen Z group believing that it is motivated by a desire to increase household savings. Gen Z and Millennials bring a greater focus on household structures and relationships. The experience of lockdown will strengthen familial bonds.
Around 21% of the consumers who belong to the Gen Z and 23% of Millennials make purchases based on the environmental impact of a product. Around 53% of Gen Z and Millennials are well-aware of the importance of sustainability when making purchase decisions.
Consumers are conscious of the need to drive positive social and environmental outcomes. Around 68% of consumers thus expect companies or organizations to steer such impactful actions.