From Broad Concern to Willingness to Pay: Tracking Global Attitudes with the Latest Nielsen Data
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The document discusses tracking global attitudes towards sustainability based on Nielsen data. It finds that consumers are increasingly concerned about sustainability issues but also willing to pay more for sustainable products. Three global trends are driving this - increased connectivity raising awareness, millennials prioritizing sustainability, and the growing middle class in developing regions being able to choose sustainable brands. The opportunity for companies is to measure consumer preferences and build strategies around appealing to the over 50% of global consumers who are willing to pay more for sustainable options.
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From Broad Concern to Willingness to Pay: Tracking Global Attitudes with the Latest Nielsen Data
- 1. From Broad Concern to Willingness to Pay: Tracking Global Attitudes with the Latest Nielsen Data Amy Fenton, Nielsen @amyfenton1
- 2. TRACKING GLOBAL ATTITUDES WITH THE LATEST NIELSEN DATA Amy Fenton Global Leader, Public Development & Sustainability FROM BROAD CONCERN TO WILLINGNESS TO PAY
- 3. Copyright©2013TheNielsenCompany.Confidentialandproprietary. 3 SUSTAINABILITY AND PROFITABILITY ARE NOW COMPLEMENTARY
- 5. Copyright©2013TheNielsenCompany.Confidentialandproprietary. 5 SUSTAINABILITY ACTIONS CAN RESULT IN INCREASE IN SALES+5%
- 6. Copyright©2013TheNielsenCompany.Confidentialandproprietary. 6 THREE GLOBAL CONSUMER TRENDS CONNECTEDNESS MILLENNIALS EMERGING MIDDLE CLASS
- 7. Copyright©2013TheNielsenCompany.Confidentialandproprietary. 7 MORE DEVICES, MORE AWARENESS Connections make us more aware of sustainability challenges 7 40%of the world ONLINE
- 8. Copyright©2013TheNielsenCompany.Confidentialandproprietary. 8 MILLENNIALS Millennials are looking for products that share their passion for sustainability 8 OVER 50% of those willing to pay more globally are MILLENNIALS
- 9. Copyright©2013TheNielsenCompany.Confidentialandproprietary. 9 UNLEASHING THE POWER OF THE MIDDLE CLASS People are able to spend more freely on products that they believe in of the world living comfortably and spending freely 42% Growing middle class in developing markets like AFRICA and CHINA 9
- 10. WHERE IS OUR OPPORTUNITY
- 11. Copyright©2013TheNielsenCompany.Confidentialandproprietary. 11 WHO ARE THEY? OVER 50% global consumers willing to pay more
- 12. Copyright©2013TheNielsenCompany.Confidentialandproprietary. 12 HOW TO MAKE THE MOST OF THIS OPPORTUNITY MEASURE your consumers BUILD your strategy
- 13. Link to Corporate Social Responsibility Report; http://www.nielsen.com/content/cor porate/us/en/insights/reports/2014/ doing-well-by-doing-good.html
Editor's Notes
- Fri Sept 26 Main Stage 9:00-10:30
- I’m very honored to be speaking with you at the Sustainable Brands New Metrics Conference. By the very fact that we’re here together today, we know that the world is changing.
- Sustainability and Profitability are now complementary: Most of us in this room can agree….that historically, corporate responsibility efforts stemmed from an inward focus. Individuals and companies alike believed it was “good to give back”. However, “giving back” and driving corporate profitability should no longer be mutually exclusive. Today, corporate responsibility not only does good in the world and in the markets in which we do business, but now it is also a true growth lever. To unlock true growth potential, companies should be taking a hard look at their sustainability efforts. Because today, we have a true humanitarian and business opportunity.
- Client Case Study An example of where we saw this come to life… A manufacturer who had a mandate to cut their carbon footprint while… Ultimately, they reduced their packaging by 50% without compromising the quantity of the product… It’s important to know they succeeded to demonstrate how sustainability and profitability can and should coexist. However, it’s more important to understand how and why they succeeded. This company increased their market share by putting the consumer at the forefront of the decision-making. They used their propriety date to really understand who was purchasing this product and what mattered most. Rooted in measurement, they successfully turned data into insights. And it worked. They took the time to ideate, to consider how to defend and grow their existing market share while addressing the consumers call to action…reduce your carbon footprint. And they did.
- I am sure we’ve all have similar experiences with the naysayers. There’s at least one in every bunch. And that person will justifiably ask, “is that a one time phenomenon?” The answer is NO. An adamant no. At Nielsen, we mine sales data in 9 countries and across several categories. And yes, because we measure things, we also measure sustainability efforts. What we found, on average. that sustainability actions can result in 5% increase in sales. However, there’s a catch. In order to realize that 5% increase in sales, companies need to take a more proactive approach in communicating their good efforts. That means, it is our job to educate and evangelize our marketing teams. To make them believers and demonstrate the positive impact sustainability can have on the business’ bottom line. It’s the right thing to do if we plan to continue to drive shared value.
- Sustainability as a driver of business growth is fueled largely by three global trends. Connectedness Millennials Emerging middle class
- Unlike ever before in the world’s history, we live in a hyper connected world. Think about it <<remove cell phone from pocket>>, this is truly the constant pocket companion. Wherever we go, the phone goes. That connectivity gives unlimited access to information. Think about everything we can do right from our smartphone: There’s the obvious—phone calls and text messaging. Today, we likely take more pictures of our kids on our phones than a traditional camera. Same goes for video. We listen to music We watch videos We BUY things We even check scores to the game. That accessibility to information has consequently created a smarter, more aware consumer. You hear people say it all the time, “the world is shrinking”. You know what, they’re right. With 40% of the world’s population now online, we have access to current events across the world. We have accessibility to each other. Consequently, consumers globally have a deeper social conscience. They not only care what happens to their neighbor, but they are concerned for parts of the world that are in plight. SO what? It means consumers are much more educated in their brand choice. Unlike before, consumers can make choices about products that are sustainable and do good for the world. Or worse, consumers can similarly make choices about those brands they deem to do harm.
- This second trend won’t surprise you as millennials are, in fact, leading the crusade for connectivity. Millennials are a new brand of consumer. They’ve experienced connectivity and accessibility in a way unlike any generation before they. They fundamentally have a deeper social conscience. They donate money for causes, they RAISE money for causes. Think about the ALS ice bucket challenge. It was a social and fundraising phenomenon over the summer months. How did it get its start? A 24 year old Boston man who was raising awareness on behalf of Pete Frates. Pete was a college baseball player who lost his ability to not only play, but to speak, due to Lou Gehrig’s disease. So these millennials, with the deeper sense of “doing good”, they proactively hunt for sustainable brands. In fact, what we found that 50 percent are even willing to pay more money for brands that are sustainable. So when it comes to millennials, we have to develop a long-term strategy. It’s not just their social conscience of today, but it’s their spending power of tomorrow. Or rather, over the next thirty – forty years. In just ten years, they will have the ability to out spend their generational predecessors and will have more disposable income, to make sustainable and conscience brand choices.
- The third trend we are seeing is the emergence of the middle class. This isn’t a U.S. based emergence, it is happening globally. Our studies show that 42% of the world is living comfortably and spending freely…and the number is growing. Again, that emergence is happening in developing markets. Markets like Africa and China. It’s happening in corners of the world that are in plight. Countries and communities who face deforestation, lack access to education, or clean water. All in their own backyard. So as people in these communities increase their spending ability, they are naturally looking for brands to give back to their communities. They are looking for brands that tackle the very issues they see each and every day. The power of this middle class is real and it presents a significant opportunity for businesses.
- So where is our opportunity? Well, I will say this. The current consumer environment and mindset is in our favor. We already know they are ready and willing to buy sustainable products. In fact, some will even insist on it. But now, it’s time to understand how to capitalize on this opportunity of driving even greater shared-value. How to give back while also helping improve your business’ bottom line. You need to know your audience.
- If we know that 50% of the world’s consumers are willing to pay more for sustainable brands, and they’re NOT just the wealthy, what’s next? Now is the time to embrace and understand the power of measurement. Today, we are measuring…. This is just the beginning. More on importance of measurement
- Now, as the people charged with driving the charge for sustainability, the onus is on us to debunk some popular myths. Sustainable options are available to all consumers. It’s not just premium priced good, but we know that even store brands have organic options. More needed here. So again, how to make the most of this growth opportunity You have to know your consumer. Measure them. Know what matters to them. What they want, and you need to take that and build it into your brand strategy. When you’re focused on the right causes the combination of results is positive Sustainability is no longer a choice. It’s a cost of entry for doing business, likely for all the categories we represent today The face and pace of consumers is changing. The growing expectation that companies are doing good. More today than ever before