Recent studies increasingly highlight sustainability as a focal point in consumer decision-making, with a growing array of products boasting sustainable attributes. This trend is notably evident in the fashion industry, where there’s a rising willingness to invest in ethically and sustainably produced clothing.
The key question arises: Does this trend of valuing sustainability hold true in vital sectors like the food industry? As someone very wise once said, without farms we’d all be sober, naked, and hungry.
Are consumers genuinely prepared to spend more for sustainably produced food, or is this preference more rhetoric than reality when it comes to daily essentials?
When analyzing consumer buying decisions, three factors have consistently dominated for over a decade:
- Taste
- Price
- Quality
These priorities have remained steady year over year for more than a decade. Sustainability, specifically relating to the environment, does make the list of decision drivers– but only at #7 in terms of priority – below both health and convenience.
This lower ranking might seem surprising amidst the widespread buzz around sustainability. [MG1] While 82% of consumers are familiar with the term sustainability, only 22% can identify a sustainable product, and a mere 17% can identify a sustainable company.
Diverse interpretations of ‘sustainability’ exist among the 82% who are familiar with the term, encompassing aspects like water usage, meat production, and operational efficiency. This has led to a somewhat ambiguous understanding of sustainability (Hartman Group, 2021).
Where does sustainability lie in terms of consumer concerns?
According to Mintel’s 2022 Sustainability Behavior Survey, climate change, water shortages, and food shortages have made the biggest gain in priority compared to other customer concerns. This is a significant shift over the last several years, towering over issues like plastic pollution which formerly dominated the charts.
While many consumers express a willingness to base their food purchases on environmental friendliness, there’s a gap in their ability to discern which products or companies align with these values. Consumers need help to determine the legitimacy of sustainability claims.
Are we witnessing an intention gap with sustainability?
The gap between intention and action is noteworthy. Although 50% of consumers claim they would choose sustainable food products, only 31% actually do so based on purchasing patterns
Further broken down, if buyers were to pay a premium for a sustainable product, 40% would pay over $1 more, 15% would pay $5 more, but very few would go over that limit.
Supportive of this research, in our time working with food brands we have found only a few examples of products with science-based sustainability claims, such as a carbon footprint, earning significant premiums in the marketplace over a comparable product without that claim.
The next generation is driving the sustainability trend
One noteworthy trend: from a demographic standpoint, the presence of children in the household nearly doubles a consumer’s interest in purchasing sustainably produced products. From the perspective of grocers and food brands, parents with children under age 18 are a coveted consumer segment. Compared to the general population, they are more likely to overspend, purchase organic and natural foods, and pay for name brands.
In total, 51% of households with children under the age of 18 are interested in products with sustainability claims versus 28% of households without kids. Younger generations and those with higher degrees of education are also more likely to answer “yes” when asked if climate-friendliness impacted their buying decisions. Dairy, meat, fruits, and vegetables lead the ranks in terms of which products carry the most environmental concern from consumers.
All together the data paints a clear picture. Today, Generation Z, Generation Alpha are most eager to commit to sustainability. Even a growing percentage of their Millennial and Gen X parents are willing to invest in sustainably produced food. Given the buy-in from the younger generations, this suggests the sustainability trend has staying power for decades to come and will continue to grow as Generation Z and Generation Alpha obtain more purchasing power. In other words, the sustainability trend has just started.
