A Better Way to Market Sustainable Products: Insights from NYU Stern and PwC Research

Sustainable products continue to captivate consumers, with many shoppers expressing a preference for environmentally friendly options. However, consumer product companies often face challenges in realizing the full market potential and price premiums of such goods. Research by NYU Stern’s Center for Sustainable Business (CSB), in collaboration with PwC, sheds light on effective strategies for marketing sustainable products, emphasizing clarity, credibility, and connecting sustainability to core product attributes.

Rising Sales and Price Premiums for Sustainability-Market Products

CSB researchers analyzed 12 years of U.S. point-of-sale data from Circana, covering 36 consumer packaged goods categories that represent about 40% of the CPG market (excluding alcohol and tobacco). The findings reveal:

• Sales of sustainability-marketed products grew at an average rate of 12.3% per year from 2019 to 2024.
• This growth rate is 2.3 times faster than that of conventional products.
• By 2024, sustainability-marketed products accounted for 23.8% of overall category sales.
• Price premiums are significant; a 2024 PwC survey of 20,000 consumers found an average willingness to pay 9.7% more for sustainable goods.
• CSB research showed that sustainability-marketed products commanded an average premium of 26.6%, with some categories like paper products exceeding 100%, and coffee, cereal, and chocolate averaging around 50%.

Strategic Recommendations for Marketing Leaders

1. Understand Customer Segments and Product Categories

Sustainable product purchasing is concentrated among particular segments such as millennials, college-educated shoppers, urban dwellers, and high-income consumers. Additionally, product categories like dairy see widespread sustainability-marketed product sales across age groups. Recognizing which segments and categories to target is vital to optimizing marketing efforts.

2. Amplify Appeal by Linking Sustainability with Core Product Qualities

Research from CSB and Edelman communications firm highlights the importance of anchoring sustainability claims to core product attributes that resonate with customers. For example, emphasizing a chocolate bar’s rich taste or a soap’s freshness, complemented by one or two sustainability messages, can increase product appeal by up to 30 percentage points. Customers prefer a harmonious message mix that blends quality and sustainability, rather than multiple sustainability claims alone.

3. Prioritize Trustworthy, Consumer-Centric Sustainability Claims

Not all sustainability claims are equally persuasive. Claims that resonate best focus on consumer-relevant benefits, including:

• Protecting human health (free from harmful ingredients).
• Saving money.
• Supporting local farms and food systems.
• Benefiting children and future generations.
• Preserving animal health.
• Originating from local or sustainable sources.

In contrast, claims solely about scientific properties (e.g., biodegradable, climate-neutral), traceability, or sustainability certifications tend to have lower appeal, although certification seals can help validate claims for regulators and certain consumers.

4. Ensure Precision and Evidence in Sustainability Messaging

PwC cautions against vague terms like “clean,” “natural,” or “safe," which are prone to legal challenges, especially for products used by or applied to children. Companies must monitor evolving regulations, such as the EU’s Corporate Sustainability Reporting Directive and the proposed EU Green Claims Directive, which require substantiating environmental claims with scientific evidence and transparency. Robust value chain analysis and traceability capabilities are essential to support credible sustainability claims and compliance.

Conclusion

Marketing sustainable products successfully necessitates more than just highlighting green attributes; it requires integrating sustainability messaging with core product qualities, targeting the right customer segments, and delivering precise, evidence-backed claims that build consumer trust. Brands applying these principles can unlock the substantial growth and price premiums that sustainability continues to offer in the consumer goods marketplace.

Authors:
Tensie Whelan, Distinguished Professor of Practice and Founding Director of NYU Stern Center for Sustainable Business
David Linich, Principal at PwC US and expert in decarbonization and sustainable operations

For further reading:

• How the EU’s Green Deal Is Driving Business Reinvention
• The CEO’s Sustainability Checklist: Ten Questions for a Winning Climate-Transition Strategy

Key Data Sources:

• NYU Stern CSB analysis of Circana point-of-sale data
• PwC 2024 consumer survey on sustainability price premiums
• CSB and Edelman research on sustainable marketing effectiveness

Design Delight Studio curates high-impact, authoritative insights into sustainable and organic product trends, helping conscious consumers and innovative brands stay ahead in a fast-evolving green economy.