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

Sustainable products are increasingly preferred by consumers, yet effectively marketing these products remains challenging for companies. Research from NYU Stern’s Center for Sustainable Business (CSB) and PwC reveals strategies to harness the growth potential and price premiums of sustainability-marketed goods.

Growing Demand and Business Case for Sustainability

• Impressive Sales Growth: Analysis of 12 years of U.S. point-of-sale data across 36 consumer packaged goods (CPG) categories shows sustainability-marketed products grew at 12.3% annually from 2019–2024 — 2.3 times faster than conventional items.
• Increasing Market Share: Sustainability-marketed products captured nearly 24% of overall CPG sales in 2024.
• Price Premiums: Surveys of 20,000 consumers indicate willingness to pay nearly 10% more for sustainable goods. Actual observed price premiums average 26.6%, with some categories like paper products exceeding 100%.

Key takeaway: Sustainable products offer both strong revenue growth and premium pricing, supporting investment in their development.

Targeting the Right Consumers and Categories

• Consumer Segments:
  Millennials, college-educated shoppers, urban dwellers, and high-income earners purchase more sustainability-marketed products.
• Category Insights:
  Some categories like dairy show broad appeal for sustainable options across all age groups.
• Strategic Focus: Understanding which customer groups are most likely to buy sustainable products within specific categories is crucial for effective marketing.

Crafting Compelling Marketing Messages

Connect Sustainability to Core Product Benefits

• Successful marketing blends the product’s central desirable attribute (e.g., taste, effectiveness) with one or two relevant sustainability claims.
• Example: A skincare product claiming “formulated with sustainable ingredients that are good for your skin” pairs sustainability with a primary consumer concern.

Impact: Combining core product qualities with sustainability claims increases product appeal by an average of 30 percentage points across demographics.

Emphasize Sustainability Claims Customers Trust

• The most persuasive claims relate to direct consumer benefits like:
  • Protecting human health (free from harmful ingredients)
  • Saving money
  • Supporting local farms and future generations
  • Preserving animal health
  • Sourcing from local or sustainable methods
• Less effective claims include generic environmental properties (e.g., biodegradable), traceability, or sustainability certifications alone.

Ensure Credibility and Compliance

• Ambiguous terms like “clean” or “natural” are risky and increasingly subject to legal challenges, especially for products used by children or applied to skin.
• Companies must monitor and comply with evolving regulations such as the EU’s Corporate Sustainability Reporting Directive and the potential Green Claims Directive, which require scientific substantiation of environmental claims.
• Investing in value chain transparency and traceability strengthens claim credibility and regulatory compliance.

Conclusion: Unlocking Sustainability Value

By clarifying the business case, targeting the right customers, crafting focused marketing messages that combine core product benefits with credible sustainability attributes, and ensuring regulatory compliance, companies can unlock the full growth and pricing potential of sustainable products.

Authors: Tensie Whelan, Distinguished Professor at NYU Stern and Director of CSB; David Linich, PwC principal specializing in decarbonization and sustainable operations.

For companies in organic and sustainable product sectors, these insights offer a roadmap to confidently market green products in a way that builds consumer trust and drives business growth.

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.