Examining consumer attitudes towards the circular economy and sustainability in 2020.
2019 was the second-hottest year on record ever, closing out the warmest ever decade (1). It was also the year when sustainability really hit the global news agenda. Large intense fires burned in Russia and Australia. New record temperatures were reached in Europe, and Nebraska suffered unprecedent levels of flooding, to name just a couple of the unwelcome records set. Global student protests took place around the world, and a schoolgirl became the spokesperson for a generation concerned about the future of our planet.
So, as we begin the new year and the new decade, we wanted to take a look at the impact the sustainability stories of 2019 have had on the general public and their buying behaviors. Are sustainability concerns changing consumer purchasing habits? Does the general public care about a circular economy? Would they be willing to change their behaviors to help create closed-loop material cycles? And how might this impact businesses?
Last year we surveyed business leaders in the US on their interest in the circular economy. While only 16 percent of US businesses have adopted the circular economic framework, 62 percent say moving toward this is part of their business strategy. But for the circular economy to have real impact, there needs to be greater cooperation between businesses and consumers.
So, this year we surveyed 15,000 members of the general public across 11 countries in Europe, APAC and North America. We focused in on three industry sectors that all of us interact with on a daily base; Fashion, Food, and Electronics.
Here’s what we learned:
Consumers believe they have a role to play: The majority of respondents believe their behavior and choices can have a positive impact on addressing global environmental challenges (83 percent).
Voting with their wallets: 49 percent said they would be willing to pay more for products made in an environmentally friendly way. 61 percent say they would be less willing to buy a company’s product if they discovered it was performing poorly on environmental practices. Going further, 48 percent of consumers under 34 years old said they’d boycotted a food company’s products after discovering the company was failing to address environmental concerns.
But despite positive intent, there are barriers:
Awareness and education: In the electronics industry, only 21 percent think companies provide detailed information on the overall environmental impact of products; 41 percent don’t know where to access repair services; 71 percent aren’t aware of device-sharing platforms; and 39 percent can’t distinguish between recyclable and non-recyclable plastics.
Empowerment and reassurance: The top reason for not repairing clothes is consumers’ belief that, to do so, they need skills they don’t have, with 48 percent having this sentiment. Meanwhile, concern about data security (42 percent) is the second-most cited concern around leasing electronic devices.
Circular infrastructure and convenience: Engagement with more novel circular practices is being held back by the perceived effort required: 41 percent think renting clothes would require a lot more effort, and 36 percent say time is a barrier to repairing devices.
Cost: Price is still a decisive factor for many consumers when buying clothes, food or electronic devices. More than half (54 percent) of consumers still choose low-cost, fast-fashion items over more expensive, more durable ones.
"Consumers around the world feel empowered to make a difference in the climate crisis. This sense of responsibility is leading many to not purchase products from companies they view as environmentally unfriendly. But not everyone is a ‘sustainable champion’, and many consumers will only choose sustainable products or engage with circular practices if it’s cheaper or more convenient. If companies are to realize the full potential of circular models and future proof their businesses, they must align their strategy to consumer preferences and make the transition to sustainability as frictionless as possible."
Joost van Dun, Circular Economy Lead, ING Sustainable Finance
To find out more about how consumers around the world are thinking about sustainability and the circular economy, as well as the opportunities and challenges for business.