Consumers will pay more for green; lower-income lead the pack, study says
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- Green marketing
Despite today’s challenging economic environment, consumers are still willing to pay extra for everyday household products that are green. That’s according to “The ‘Green’ Scene,” a mini report from Miller Zell, Inc. The report is an extension of a larger study, “Gone in 2.3 Seconds: Capturing Shoppers with Effective In-Store Triggers,” which surveyed 999 U.S. shoppers to identify which in-store and out-of-store marketing communications get their attention and influence their purchasing decisions.
Notes “The ‘Green’ Scene,” the majority of shoppers polled indicated they would be most likely to pay a 10-cent premium for household products. However, the desire to pay a premium significantly dipped when the premium reached 28% of the base price of the product, indicating that there is a price sensitivity associated with paying green.
The report advises that brand owners should inject quality and efficacy messages into the dialogue at shelf level to incent shoppers to pay more.
Another finding indicates that lower-income shoppers are more willing to pay the 10-cent premium, compared to middle and upper income groups. This may be heavily influenced by the number of green-minded Millennials who may may up a disproportionate percentage of the lower-income bracket because of their recent entry into the workforce, Miller Zell speculates.
Other findings include the following:
• Grocery and mass are the most likely channels where shoppers expect to purchase green products. This suggests other channels have an opportunity to get in the game by highlighting and promoting green product offerings in the store.
• Shoppers indicated that retailers and manufacturers do a relatively poor job of providing green information in-store. This indicates that shoppers want to be assured that they are “getting what they pay for.”
• Overall, women are more eco-conscious, closely followed by Gen Y. Both groups top the chart in their willingness to pay a premium for green products, and both are the least satisfied with the level of communications offered in-store.
• Sixty-two percent of shoppers said that green product options will influence their unplanned purchases.
See the entire study at “The ‘Green’ Scene, Series 2 of Gone in 2.3 Seconds: Capturing Shoppers with Effective In-Store Triggers.”
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When we look at our world now we see a lot of confusion and regulations especially when it comes to green packaging. Companies who have made containers for food products are being told it is ok to package the food in plastic, just have the container magically disappear when the food is gone. Or just have the plastic bag magically disappear after it has been used. Make it a law that is tantamount to closing a production facility's doors if it cannot comply.
We have an industry based on fossil fuels that has grown and sustained us for over a hundred years -- it is important to keep it strong while the fledgeling organics and green industry continues to grow. We need to see both production rainbows in the industrial sky: fossil fuel industries and green or organics industries -- both working together to create economies and employment.
Changes are needed but changes that make economic sense as well as environmental sense.
John 08-26-09
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