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How Sustainability Has Moved From an Idea to an Imperative

NielsenIQ report highlights consumer-driven transformation to greener business models
Lynn Petrak, Progressive Grocer
Sustainability at home
Consumers who want real, actionable change will spur CPGs and retailers to transform business models, a NielsenIQ report claims.

The winds are shifting on the impact of climate change at the point of sale. Although sustainability has been a much-talked-about topic for decades and especially over the last few years with the emphasis on ESG plans it is quickly moving from goal to action status.

Environmentally savvy consumers are driving much of the acceleration, according to a new report from NielsenIQ.  The Chicago-based research firm revealed that 76% of global consumers are calling for companies to take steps to reduce their environmental footprint and virtually the same number (77%) said they would stop buying products from a company deemed to be “greenwashing” its efforts by not following through with pledges to make quantifiable changes or making misleading claims of progress.

[Read more: "Line of Grocery Bags Certified as Biodegradable"]

Shoppers are also looking to retailers to provide them with choices that align with their eco-values. NielsenIQ reports that an overwhelming 79% of respondents globally and 69% in the United States said they are likely to choose a particular retailer if it offered a broader variety of sustainable options. About a quarter of survey participants said that it was difficult for them to find sustainable products on store shelves and 41% noted that sustainable products are too expensive.

"Sustainability has been on the corporate agenda for some time, as a slow burn priority where some businesses have made proactive decisions to get ahead of the pack and others have taken a wait and see approach," noted Regan Leggett, foresight leader at NielsenIQ. "Exploding energy costs, crop failures, and supply chain disruption are all forcing companies to future-proof existing business models or bear uncertainty and increased cost implications."   

In its report, NielsenIQ projected that consumer demands, governance and cost will spur CPGs and retailers to commit to real, sustainable business models over the next five years. As brands and grocers work to meet regulatory requirements and demonstrate their public commitment to sustainability, they will take more authentic actions, the report predicts.

The stakes are high for trust and loyalty among the growing legion of green-minded shoppers, pointed out Nicole Corbett, NielsenIQ’s VP of thought leadership. "Consumers want help to live and consume sustainably; however, not all corporations have sustainable practices," she asserted. “Over the past decade, consumers have been calling for a green revolution that has not materialized, and greenwashing and inaction from brands and retailers has left consumers with varying levels of trust in these parties to deliver."  

In addition to transforming their business models with actions like embracing renewable energy, investing in alternative agriculture products or creating new supply routes, CPGs and their retail partners can also better communicate their actions to consumers. As Corbett declared, "From a brand perspective, consumers want brands to help their sustainable efforts by ensuring sustainable products that are more  competitively priced, that offer not just an environmental benefit but also a personal health benefit. Those that are packaged with clearer labeling are likely to stand out among competition.”

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