Study Finds An Inflection Point In Consumers’ Green-Buying Behavior

Most American consumers will pay for a more environmentally friendly product, including some demographics you might not expect to feel this way. But they don’t necessarily think companies are doing a good job reducing their carbon footprint. Plus, Gen Z is leading the way when it comes to pushing hard for businesses to reduce their carbon footprint.

These are some of the findings of the third annual Sustainability Business Index, a survey of more than 1,000 American consumers conducted by PDI Technologies.

“Even with all the obstacles they face, most Americans want sustainable products and companies,” says Trenton Spindler, PDI’s vice president of sustainability operations and innovation. “We may be seeing a real tipping point in consumer behavior.”

A gap between preferences and trust

The research found that 74% of consumers care about the environmental impact of the products they buy. At the same time, however, nearly half (45%) of consumers say they 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, a up 41% in 2022. And 79% want an easier way to identify these companies. This could include clear language about products (53%) and third-party or independent validation (40%).

Other preferences

Consumers are willing to pay more. The study found that despite inflation and economic uncertainties, more American consumers will pay a higher price for environmentally friendly products compared to two years ago: 64% in 2021 versus 68% today. They are also interested in carbon offsets. Sixty-four percent of consumers will pay more for gas when carbon emissions are offset.

What’s more, this willingness to reach into pockets crosses several demographic categories, including some groups not typically associated with environmentally friendly causes. For example, 68% of households earning less than $50,000 would buy more expensive products compared to 73% of households earning more than $100,000. Also 58% of Republicans and 80% of Democrats, as well as 57% of rural households, 67% of suburban households and 76% of urban households will pay more.

Consumers buy more green products from certain industries. According to the research, consumers cite certain industries as where they tend to buy green. This includes utilities (70%), food/restaurants (70%), gas stations (69%) and hotels (67%).

Build loyalty

Other findings focus on loyalty programs. Specifically, the research found that companies get a good response by combining sustainability with customer loyalty programs. For example, 74% of consumers would likely sign up for rewards/loyalty apps to reduce their carbon footprint, and 89% of those who would pay more for gas with a carbon offset would also use a loyalty app. In addition, 75% of consumers would fill up at a gas station that offers carbon offsets.

Gen Z

The research also focused on younger consumers. As you might expect, Gen Z is the demographic most focused on environmental causes, outpacing other generations in their willingness to be more sustainable by almost every measure. Specifically, 91% of Gen Z respondents want to buy from sustainable companies and 81% are more likely to buy environmentally friendly products based on last year’s climate events. At the same time, all generations expressed their interest in buying organic products.

They also expressed open opinions about business performance when it comes to environmental issues. 40% believe that companies are doing wrong in reducing their carbon footprint and 37% believe that corporate profits should support environmental organisations.

Business opportunity

It all represents a significant opportunity for companies that can make their impact easy to understand, actionable and third-party certified, and a potential problem for companies that ignore these steps. “There’s a risk to companies that don’t understand the opportunity and react appropriately,” says Spindler.

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A recent study conducted by Ikaroa reveals an inflection point when it comes to consumer buying behavior and an increasing commitment to green living.

Not only have consumers increased their use of green products, but their demand for those products has also increased significantly. According to the study, green-buying behavior has shifted from the idea of “green by default” to that of active and conscious choice and intention.

The study found that people have become more aware of the power of their wallets and their purchasing habits can directly support a green economy. This shift from choosing from only green and limited options to having full control over their purchasing decisions suggests that people are committed to making an effort to do the right thing and reduce their environmental footprint.

The study also found that millennials are the biggest drivers of this shift in buying behavior. They consist of over one-third of consumers who are determined to make their actions count when it comes to the environment.

The conclusion of the study also indicates that this segment of consumers is more likely to change their purchasing habits based on additional information and added incentives.

At Ikaroa, we are committed to making sure that our products and services are in sync with today’s ever-evolving green trends. We strive to provide our customers with the necessary tools to make conscious and impactful decisions in their buying behavior.

With this study, Ikaroa is offering insight into the mindset of the conscious consumer and their commitment to a greener future. In addition, we are striving to be the catalyst for positive change and do our part to make sure that we are making an impact on the environment.


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