Looking at the Big Green Buying Picture
Earlier this month, two different studies were released, designed to capture a snapshot of the key supporters and purchasers of green products and services. One study, commissioned by SCA, the parent company of the Tork brand of away-from-home hygiene products, was conducted by the Harris Poll. The other was prepared by Shelton Group, a marketing and communications firm focusing on the green and sustainability industry sectors.
While the studies investigated different issues, they both indicated that the number of Americans selecting green products and services is either stagnant, or in the case of the Harris Poll, has actually declined.
Specifically, the Harris study found that 75 percent of American adults reported purchasing green products and services; however, this represents a slight decrease from last year when 78 percent reported doing so. While this is a small decrease and there likely have been ups and downs in the past, it came as a bit of a surprise. The belief has been that because most Americans are so much more focused on selecting green and sustainable products today, one would anticipate that number to have moved up, not down.
However, before digging deeper to learn what this could mean—if it means anything at all—we first should review some of the highlights of both studies:
- There are expected to be nearly 80 million millennials by 2020, who will account for 30 percent of all retail purchases by the end of this decade
- Twenty-seven percent of millennials say they have increased the number of green products and services they select (Harris)
- Of adults 35 to 44 years old, 18 percent say they have increasingly selected green products and services (Harris)
- Fifteen percent of adults over 45 have also increased their selection of green products and services (Harris)
- Asked if they would select a green product or service even if it cost more, 40 percent of adults indicated they would do so for products if ethical and responsible manufacturing practices are guaranteed; however, 56 percent of millennials indicated they would pay more for such products (Harris)
- “Greener” products and corporate commitments to sustainability are desired by 70 percent of consumers (Shelton)
- About 30 percent of American consumers select products based on a company’s green reputation; 25 percent look to see if the product has been certified by a leading certification organization (Shelton)
- If a company was revealed to have misled consumers about how green their products are or if they were fined for failing emissions tests, 50 percent of respondents would stop purchasing the product (Shelton).
Why the Decline
Considering the stagnation or slight decline among American adults choosing green products and services, the first thing we must realize is that it is very hard to predict consumer behavior. Further, and likely even more important, there are many variables impacting what products and types of products consumers select at any time.
For instance, the American economy has experienced quite a swing in the past five or six years. In 2008, there were concerns the country was headed for another Great Depression with thousands of American losing their jobs. However, five years later, the stock market is at record highs and a graph of the US unemployment rate shows a steady decline since its high four years back.
How can this swing impact green buying behavior? According to the Shelton Group, consumers likely held back all buying a few years ago but now, with more confidence in the economy and in their own economic futures, they are eager to make purchases, whether the products are environmentally preferable or not.
However, what we must also note, and this is of key importance, is that there is a huge difference between consumer buying trends and the purchasing trends in the B2B marketplace. For instance, in the professional cleaning industry, the popularity of green cleaning products and equipment continues to grow, and indications are that facility owners and managers are most apt to choose a green product over a conventional one unless a green product is not available or is cost prohibitive—and these situations are increasingly unlikely.
This is also true in other B2B industries. And while consumer purchasing behavior may move up or down based on a variety of issues, what is increasingly clear is that this is not true in the commercial and institutional marketplace where green and sustainability issues are emerging as paramount in all product/service selections.
Stephen P. Ashkin is Executive Director of the Green Cleaning Network a not-for-profit organization dedicated to educating building owners and suppliers about Green Cleaning, and president of The Ashkin Group a consulting firm specializing in greening the cleaning industry. He is considered the “father of Green Cleaning” and is coauthor of both The Business of Green Cleaning and Green Cleaning for Dummies.
Energy Manager News
- Microgrids, Now Mainstream, Continue to Advance
- Developing Economies Increasing their Share of Renewable Capacity
- LG Chem In Big German Battery Project
- ERC: Electricity Price Trends for the Week Ending Nov. 20
- PUCO: ‘Fixed Means Fixed’ in Retail Contracts
- FERC Requires Reports on Price Formation
- Viridian Energy Moves into Texas Market
- PUC Approves PPL’s 6.1% Rate Hike