Sustainability concerns continue to rise among Australian consumers

25 June 2024 Consultancy.com.au 3 min. read
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The number of consumers in Australia who consider sustainability an important factor in their behaviour has grown by more than ten percent over the past five years.

The latest Consumer Sustainability Report compiled by global strategy firm L.E.K. Consulting has found that 62 percent of consumers in Australia, the UK and US now consider sustainability a core value, up from 50 percent in 2019.

That number however was lower than the overall global figure, which included people in India, Brazil, China, Japan, Germany and France surveyed for the first time, who collectively rated sustainability as being integral five points higher.

Sustainability concerns continue to rise among Australian consumers

All up, 92 percent of respondents in the English-speaking countries of the previous survey considered sustainability to be at least somewhat important, up by six points, suggesting both rising awareness and previously concerned consumers placing an increased level of importance on the subject over the past five years. Concern, however, doesn’t automatically translate into action.

First rattled by the Covid-19 pandemic, much of the world has since been hit with a dramatic cost of living crisis due to inflation, which has been particularly pronounced in Australia. Here, local residents have been the slowest to adopt sustainability ‘actions’ over the past two years, with the number of consumers doing so now falling behind the US, UK and global averages at 60 percent.

Sustainability concerns continue to rise among Australian consumers

Also, when it comes to at least considering a particular type of action in respect to shopping, transport and other everyday behaviours, many of the most popular – such as reducing home energy costs and maximising a product’s lifespan – could be seen as a by-product of the current household budget crunch. Certainly, they tend towards the more convenient, easier, and most cost-effective.

Notably, more than two thirds of respondents in Australia reported a reduction in disposable income as having impacted their spending on sustainable products over the past twelve months, while less than a third globally said they would be more willing to pay a premium for a sustainable option than they were three years ago, with the majority unbudged and 5 percent even less likely than before.

Sustainability concerns continue to rise among Australian consumers

On average, consumers who are willing to fork out for a sustainable option still aren’t prepared to spend more than a fifth extra, with fluctuations across categories (e.g. 24 percent more for fresh food compared to 8 percent for the pet variety) suggesting more of a personal health concern than a planetary one. Price and quality were privileged over sustainability in every consumer product category of the study.

The overall contradiction, in rising concerns among consumers as to sustainability not being met by a widespread inclination to continue spending substantially more (be it due to financial pressures or perhaps fatigue at individually bearing the costs of decarbonisation when corporates are perceived to be profiting as much as ever), indicates a delicate balancing act ahead for producers.

“While consumer sentiment around sustainability is clear, the degree to which they are willing to act or spend more is somewhat mixed,” concludes L.E.K. Consulting partner Mark Boyd-Boland. “Those brands which understand how sustainability changes in meaning across markets, demographics and customer segments, and can translate this into pricing and marketing strategies, will be best placed for success.”