Amidst economic concerns like high fuel prices, consumers globally are prioritizing affordability, according to the June 2022 release of the EY Future Consumer Index. This marks a shift from the index’s reading in October 2021, when putting the planet first became the top priority, above concerns like affordability and health.
But does that mean that until factors like inflation level out that consumers don’t care about sustainability? Far from it.
Still, businesses need to realize that consumers are being more careful with their consumption.
“Consumers are increasingly price sensitive, but they are not willing to abandon their growing resolve to live and buy more sustainably. Many companies will need to adopt a new strategy, approaching sustainable products and services as a cost-effective option for the consumer, not a premium choice,” says the EY report.
As it stands, 67% of consumers say the high price of sustainable products deters them from purchases. But brands could have an opening by focusing on features like longevity.
A reusable product might cost more initially than a disposable one, for example, but it can make more sense environmentally and financially in the long run. That aligns with the fact that among consumers in the survey who put affordability first, 71% are focused on “repair not replace”, up from 47% who felt that way in February 2022.
The EY survey also finds that 85% of consumers are trying to conserve energy and 87% are trying not to waste food. So, brands that can highlight opportunities to minimize waste and maximize conservation can appeal to consumers who care about saving money while doing good for the planet.
Some brands could even tap into demand for used products.
A March 2022 survey from Ally Financial finds 71% of consumers ages 18-40 would prefer to buy a used car over a new one; nearly two-thirds of used car shoppers say that preference comes down to sustainability.
That aligns with the latest EY study, which finds that 36% of consumers say they’ll buy more second-hand items. Plus, the vast majority of those who put affordability first say they’re less interested in the latest fashions and latest technology.
Of course, not all brands have the opportunity to sell used goods, but it could open up new revenue streams for some retailers. From cars to clothes to consumer electronics, many categories fit with resale.
Yet even if you can’t sell used products, like in the case of food brands, you could still tap into this re-usability demand. For example, selling products in reusable packaging could appeal to consumers. In March 2022, 64% of U.S. retail consumers said they would pay more for sustainable packaging, finds Blue Yonder, a supply chain software company.
Even if that number has gone down in recent months due to economic concerns, brands can still find value in making these types of changes.
Companies like Ecos, a cleaning products brand, benefit from reusing materials in their own manufacturing operations to better manage costs while acting sustainably.
Yet only 36% of retail executives globally say they have a recycling program, finds Google Cloud.
So, even though consumers may be a bit pickier about their purchases in light of some cost challenges, that doesn’t mean they’re throwing sustainability out the window. In times of economic stress and uncertainty, sustainability can still be a winning strategy.
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