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

Consumers increasingly prefer sustainable products, yet many companies struggle to fully capitalize on this growing green demand. Challenges include proving the business case for sustainable goods, balancing sustainability with other product attributes, and establishing trustworthy messaging amid a crowded field of claims and certifications.

The Business Case for Sustainability in Consumer Products

NYU Stern’s Center for Sustainable Business (CSB) and PwC analyzed 12 years of US point-of-sale data across 36 consumer product categories (covering about 40% of the consumer packaged goods market). Their findings reveal:

• Sales growth: Sustainability-marketed products grew at an average annual rate of 12.3% from 2019 to 2024, more than double the growth rate of conventional products.
• Market share: These products accounted for nearly 24% of overall sales by 2024.
• Price premiums: Shoppers are willing to pay an average of 9.7% more for sustainably produced goods, corroborated by observed premiums averaging 26.6%. Some categories, such as paper goods, coffee, cereal, and chocolate, see premiums ranging from 50% to over 100%.

These statistics solidify that sustainability is not just a marketing trend but a growth and profitability driver.

Targeting the Right Consumers and Categories

Research identifies key consumer groups more inclined to buy sustainable products:

• Millennials
• College-educated shoppers
• Urban dwellers
• High-income earners

Moreover, sustainability-marketed goods have significant sales shares even across broader demographics in critical categories like dairy. Understanding which groups and categories align with a company’s offerings is essential for focused marketing efforts.

Crafting Effective, Trustworthy Messaging

Successful marketing of sustainable products hinges on blending core product attributes with sustainability benefits:

• Core attribute focus: Highlight what consumers first value, such as taste, cleanliness, or effectiveness.
• Layered sustainability claims: Adding one or two sustainability messages related to the product category can increase appeal by 30 percentage points. For instance, a skincare product marketed as "formulated with sustainable ingredients that are good for your skin" links sustainability directly to consumer benefit.

Most Trusted Sustainability Claims:

Claims with the highest consumer appeal relate to tangible benefits:

• Protecting human health (no harmful ingredients)
• Saving money
• Supporting local farms and food systems
• Supporting children and future generations
• Preserving animal health
• Originating from local or sustainable sources

Less Effective Claims:

• Scientific properties (biodegradability, climate neutrality)
• Traceability
• Packaging claims (except those on recycled content)
• Sustainability certifications alone (helpful but insufficient without supporting messages)

Ensuring Credibility and Compliance

Ambiguous terms like "clean," "natural," or "safe" can invite legal challenges, especially for products used by children, ingested, or applied to skin. Companies should:

• Use precise claims supported by scientific evidence.
• Monitor evolving regulations such as the EU’s Corporate Sustainability Reporting Directive and the proposed Green Claims Directive.
• Build capabilities to analyze and trace value chains to validate claims.

Conclusion

The collaboration between NYU Stern’s CSB and PwC furnishes marketing leaders with actionable insights to unlock the full value of sustainable products through:

• Clearly articulating the robust business case for sustainability.
• Targeting the right consumer segments and product categories.
• Crafting compelling, credible messaging that aligns sustainability benefits with core product qualities.
• Proactively managing regulatory risks and ensuring transparency.

Sustainable products are proven growth drivers that reward companies who market them with authenticity and strategic insight.

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

Source: Strategy+Business (May 21, 2025)
[Original article by Tensie Whelan and David Linich]

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