Consumers are Buying More Sustainably Again

Are German consumers more willing to spend their money on sustainable products when the general consumer mood is rising? The current GfK Sustainability Index seems to confirm this trend. With consumer sentiment brightening, the index rises again in April 2023 and now stands at 99.9 points. This is 6.6 points higher than in January. Consumers’ awareness of social sustainability and their expectations for companies to act responsibly are also on the rise.

At the beginning of the year, concerns about inflation and high energy costs led consumers in Germany to plan fewer purchases with sustainability in mind. Under the influence of the consumer climate, which continues to develop positively, consumers are now more willing to make sustainable purchases again. Accordingly, the index for sustainable major purchases has risen from 93.8 points in January to 101.9 points now. The index for sustainable FMCG products (food and drugstore articles) is developing somewhat more moderately. It rose from 92.9 points in January to 98.6.

Willingness to pay more for sustainability

Even though the market for technical consumer goods declined overall at the start of the year, the trend toward energy-efficient appliances is continuing. The proportion of consumers planning major purchases in the next twelve months that take sustainability aspects into account rose to 29 percent (+2 percentage points) in April. At 70 percent, the proportion of consumers who plan to buy sustainable products and packaging and are also prepared to dig deeper into their pockets to do so remains almost constant.

Slightly lower, at 65 percent, is the proportion of consumers who are prepared to spend more money when purchasing sustainable FMCG products. “At first glance, consumers’ willingness to pay more for everyday items seems somewhat lower than for larger purchases,” says Petra Süptitz, sustainability expert at GfK. “However, consumers know that they can switch to cheaper sustainable products, especially when it comes to food, and they do so. They continue to buy organic products, but are more price-conscious when doing so, compare offers and more often reach for alternatives such as the organic private labels of discounters.”

For both larger purchases and FMCG products, it is primarily consumers with higher household budgets who buy sustainably. People with lower incomes, on the other hand, frequently state that ecologically sustainable products are too expensive for them, although protecting the environment as a personal value is even slightly more important to them than to higher earners.

Social responsibility even more important than ecological sustainability

Sustainable consumption is often associated primarily with ecological aspects. In this respect, many companies are already well positioned, for example by relying on recycled packaging or sustainable ingredients. However, the GfK Sustainability Index also covers the social dimension of sustainability, as this is becoming increasingly important for consumers. According to GfK’s Best Brands survey, it even counts more heavily on the success of brands than ecological sustainability.

“Consumers are becoming more aware of social aspects, and they increasingly expect companies to act responsibly, such as strictly adhering to ethical standards along the entire supply chain,” explains Süptitz. “Brands that take social sustainability seriously, implement it credibly and communicate it can offer real added value over the competition and be successful in the long term. The results of our Best Brands study show that sustainability pays off in terms of both market share and emotional brand loyalty.”