- Thursday, April 25, 2024
By: Shubham Ghosh
CONSUMERS belonging to Gen Z and millennial groups in countries such as India, China and other emerging ones are more environmentally aware and more likely to buy sustainable products and trust corporate sustainability claims less than their counterparts in the developed economies, a report released by Credit Suisse Research Institute on Tuesday (1) said.
The survey, which covered 10,000 young consumers from 10 nations, showed companies that offer products that are aligned with the values of these customers have significant opportunities in food, fashion, travel, tourism and housing industries. Those that are not so aligned face risks on the other hand, Bloomberg reported.
It also cited the Credit Suisse research findings saying Gen Z and millennials account for 54 per cent of the global population and 48 per cent of consumer spending which will go up to 68 per cent by 2040.
“Of particular importance in this regard is the role of the young emerging consumer, given the potential rise in spending power across the emerging world and the fact that, demographically, developing countries are skewed more toward younger consumers,” the report’s authors wrote.
The survey also found that Gen Z and millennials in the emerging economies support government regulation of unsustainable products or banning them from the market more.
Eugène Klerk, Credit Suisse’s head of global ESG & thematic research, said in an email that the survey did not directly respond to the query as to why Gen Z and millennial consumers in emerging economies are more sustainably-minded than those in developed nations, the Bloomberg report added.
However, he said that climate change may explain the difference in their attitudes.
“First, consumers across emerging markets might have been more exposed to the impact of global warming than those living in developed markets, which might explain why they are more engaged with finding solutions,” he wrote.
“Another reason could be that younger consumers in developed countries have a lifestyle that is less sustainable than that of consumers in developing economies.”
Research firm Nielsen surveyed young consumers in five emerging economies, namely, Brazil, China, India, Mexico and South Africa and in five developed countries, namely, France, Germany, Switzerland, the UK and the US.
It found that 65 per cent to 90 per cent of respondents in the 10 countries had a “high level of anxiety” about issues related to sustainability.
Three-quarters of those worried about the planet said they want to live more sustainably by spending more on things such as solar panels and electric cars while avoiding fast food and meat.
It said while 80 per cent of young consumers want to buy sustainable products as much as they can, more than 15 per cent of respondents in India and China said that they are only into buying goods that are sustainably made.
Sixty-three per cent of Gen Z and millennials expect to own an electric or hybrid electric vehicle. In China, more than half of respondents said they already own such a car.
In the developed countries, however, a majority of young customers said they had no plans to curtail flying, whereas their counterparts in the emerging economies expect to reduce time spent on planes.
Giving up fast fashion which is environmentally destructive is a harder call for the young consumers, it was found. While 41 per cent of the respondents said they believe the fashion industry is not sustainable, given its greenhouse gas emissions and consumption of water and plastics, only 20 to 40 per cent plan to reduce fast fashion purchases.
China has been an outlier where more than half said they were into buying less fast fashion.
The survey also found that Gen Z and millennials view corporate proclamations of sustainability with less trust, with 63 per cent saying that they don’t believe in such claims.
About 60 per cent of the respondents in India, Brazil, South Africa, Mexico and the US said the management compensation should be tied to the sustainability of a company’s products.
