Sustainable Product Market Picks Up Momentum in United States
Consumers in the United States by Oct. 20 had spent $128.5 billion in 2018 on sustainable fast-movin…Consumers in the United States by Oct. 20 had spent $128.5 billion in 2018 on sustainable fast-moving consumer goods, according to Nielsen. The figure already had eclipsed $125.4 billion in 2017. Sales have risen nearly 20% since 2014 with a compound annual growth rate of 3.5% and a push from millennials.
New York-based Nielsen forecasts the market to reach somewhere between $142.4 billion and $150.1 billion by 2021. Nielsen combines sustainability into free-from, clean, simple, sustainable and organic labels. Sales of products with sustainable attributes now make up 22% of total store sales. The market share moved up close to three percentage points from 2014 to 2017, and it could hit 25% by 2021.
Nielsen found 48% of U.S. consumers said they are definitely or probably changing their consumption habits to reduce the impact on the environment. Millennials, at 75%, are more likely than baby boomers, at 34%, to say they are definitely or probably changing their habits to reduce impact on the environment.
Ninety percent of millennials, ages 21 to 34, said they are more willing to pay more for products that contain environmentally friendly or sustainable ingredients. Another 86% of millennials said they would pay more for products with organic/natural ingredients, and 80% said they would pay more for products with social responsibility claims. The percentages for baby boomers, ages 50 to 64, were 61% for environmentally friendly or sustainable ingredients, 59% for organic/natural ingredients and 48% for products with social responsibility claims. Millennials, at 53%, were more likely than baby boomers, at 34%, to say they would be willing to forego a brand in order to buy environmentally friendly products.
“The generational divide in sustainability is fueled by technology,” said Sarah Schmansky, vice-president, Fresh/H&W Growth & Strategy for Nielsen. “We’ve found that sustainable shoppers in the U.S. are 67% more likely to be digitally engaged, which means they are used to having the products and knowledge they want right at their fingertips. With their devices playing a significant role in their purchase decisions, a simple and frictionless shopping experience between on and offline is critical.”