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

Consumers increasingly prefer sustainable products, yet many companies struggle to optimize their marketing strategies for these goods. Research by NYU Stern’s Center for Sustainable Business (CSB) and PwC highlights effective approaches to capture the full potential of sustainability in consumer packaged goods (CPG).

The Business Case for Sustainability in Consumer Products

• Market Growth: Sustainability-marketed products grew 12.3% annually (2019-2024), more than double the growth rate of conventional items, capturing 23.8% of total CPG sales by 2024.
• Price Premiums: PwC surveys reveal consumers are willing to pay an average of 9.7% more for sustainable goods. Actual sales data from CSB show sustainable products frequently command premiums—26.6% on average, exceeding 100% in some paper goods and around 50% for coffee, cereal, and chocolate.

Key takeaway: Sustainable products not only drive faster sales growth but also justify higher price points, confirming strong business value.

Targeting and Messaging: Amplifying Appeal

• Customer Segments: Millennials, college-educated, urban dwellers, and higher-income buyers purchase more sustainability-marketed products. However, broad appeal exists in key categories like dairy across all age groups.
• Marketing Mix: Successful pitches blend a product’s core appeal (taste, performance) with one or two powerful sustainability claims. This combination increases product appeal by up to 30 percentage points, outperforming messaging focused solely on sustainability.
• Category-Specific Claims: The most resonant messages link sustainability to attributes customers care about. For skincare, “formulated with sustainable ingredients that are good for your skin” connects sustainability to product benefit.

Building Trust with Credible Claims

• Effective Claims: Highly trusted sustainability messages emphasize consumer benefits, such as protecting human health, saving money, supporting local farms, aiding future generations, and preserving animal health.
• Less Impactful Messages: Claims focused on biodegradability, climate-neutrality, traceability, packaging (except all-recycled content), and certification seals tend to have lower consumer appeal, though certifications still serve regulatory validation roles.
• Precision & Evidence: Avoid vague claims like “natural” or “clean,” which risk legal challenges—especially for health-related products. Firms should closely monitor evolving regulations, such as the EU’s Corporate Sustainability Reporting Directive and upcoming Green Claims Directive, which mandate scientific substantiation for claims.
• Capabilities Needed: Success hinges on robust value chain transparency and traceability to substantiate claims credibly.

Practical Actions for Marketers

1. Identify Key Customer Segments: Tailor sustainable product offerings to groups most inclined to purchase them.
2. Blend Core Product Attributes with Sustainability: Focus marketing messages on how sustainability enhances product benefits.
3. Prioritize Trustworthy Claims: Highlight sustainability benefits relevant to consumers and backed by strong evidence.
4. Stay Ahead of Regulation: Build organizational capacity for value chain analysis and compliance with emerging sustainability standards.

Conclusion

Sustainability in consumer products presents a compelling growth and premium opportunity. By combining sound business analysis, targeted messaging aligned with product attributes, and credible claims, companies can better connect with consumers and unlock the full value of their sustainable products.

Article by Tensie Whelan, Distinguished Professor of Practice at NYU Stern and Founding Director of the Center for Sustainable Business, and David Linich, Principal at PwC US specializing in decarbonization and sustainable operations.

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.