Is sustainable shopping sustainable in the cost-of-living crisis?

Globally, consumers are prioritising affordability over sustainability for the first time since the middle of the pandemic¹. Over half of Australians believe that to live more sustainably their cost of living would increase and one-third would consider living more sustainably if they knew it would save them money.”² And while the desire of Australian households with lower incomes to live sustainably is higher today than the overall pre-pandemic average, a 2022 survey highlights that the challenges to shopping more sustainably range from pricing (41 per cent believe sustainable products are priced too high) to value (21 per cent believe that the quality of sustainable products is not consistent).³

Despite inflationary pressures, sustainability still matters to all Australians

The popularity of sustainably marketed products among young consumers points to an enduring demand⁴ but all Australians are concerned by the ethical status of the products we buy and the companies we buy them from. For example, 53 per cent are willing to pay more to purchase from a purpose-led business with almost one in five willing to pay over 10 per cent more⁵. This rises to over seven in 10 Gen Z who would pay higher prices for products from companies that align with their purpose and core beliefs.⁶ Interestingly, in the US, Gen Z and Millennials associate the term ‘sustainability’ with environmental factors more than older Americans⁷; yet while younger consumers are pushing for more sustainability, Boomers and Gen X are driving those sales today⁸.

Half of Australians tell us that they try to buy environmentally friendly products and 68 per cent are trying to purchase locally grown/made products over imported products when available.⁹ Sustainability is particularly important for online shoppers, so it’s important to make it easy to find sustainable products online with ingredient lists, product origin and packaging recyclability information.¹⁰ For example, just one-third of Australians believe the food/drink label claims on products are accurate and truthful.¹¹

It remains to be seen how the cost-of-living crisis will squash or amplify sustainable behaviour

The cost-of-living crisis in Australia is inadvertently forcing many people to think more sustainably especially as soaring energy prices force a review of household energy consumption and practices. But is it also making people more aware of wastage? More than half of Australian adults admit to wasting money regularly (on average $276 per month)¹² and as a nation, we waste 7.6 million tonnes per annum of food.¹³

There is a clear need to help shoppers recognise the value of everything they shop for – and how to make the most of every purchase. For example, ‘Use it up’ is a national OzHarvest campaign launched in September 2021 to tackle food waste at home. Seven months after the campaign launch, they found that people using both the ‘Use it up’ tape and cooking a weekly meal significantly reduced food waste by up to 30 per cent per week. UK supermarket giant Sainsbury’s opened ‘Sainsfreeze’ late last year – a pop-up, walk-in freezer concept store showing customers how to freeze unexpected foods they’d normally buy fresh, saving surplus food going to waste and helping people save money. Customers accessed shelves stacked with fruit, vegetables, dairy, meat, fish and baked goods – but everything was frozen and being given away for free to help teach them new ways to freeze food that allows them to reduce waste in the home.

Remember, sustainability is table stakes as more consumers purchase based on sustainable attributes such as recyclable, reusable, and biodegradable; and consciously shop at retailers committed to sustainability. Brands with sustainability as part of their core value proposition are likely to fare better than ones that consider sustainability as risk management or risk avoidance.

1. M Curtis, EY Future Consumer Index: Rising cost of living forces consumers to tighten grip on finances and get creative with sustainability, EY, 30 June 2022, accessed 14 February 2023
2. n=1,000 surveyed online between the 22-29 September 2022. IKEA Australia Sustainability Report 2022, accessed 14 February 2023
3. PwC, Sustainability in Retail and Consumer Goods: Added cost or source of value?, 2022, accessed 14 February 2023
4. R Kronthal-Sacco, J Driggs, The Future of CPG Products Will Be Sustainable, NYU Stern Center for Sustainable Business and Circana, undated, accessed 14 February 2023
5. CommBank, CommBank Consumer Insights: The power of moving with purpose, March 2022, accessed 28 October 2022
6. CommBank, CommBank Consumer Insights: The power of moving with purpose, March 2022, accessed 28 October 2022
7. R Kronthal-Sacco, J Driggs, The Future of CPG Products Will Be Sustainable, NYU Stern Center for Sustainable Business and Circana, undated, accessed 14 February 2023
8. Circana Panel Data; Analysis by NYU Stern Center for Sustainable Business. R Kronthal-Sacco, J Driggs, The Future of CPG Products Will Be Sustainable, NYU Stern Center for Sustainable Business and Circana, undated, accessed 14 February 2023
9. Circana, AU Household Weight Jan 2023; base n = 5,031
10. Circana OmniConsumerTM Survey Solutions, June 2022, n=895; Top Product Information Types Online Shoppers Want to See. Circana, Sustainability and the Consumer, September 2022, accessed 14 February 2023
11. Circana, AU Household Weight Jan 2023; base n = 5,031
12. P Portman, 10.5 million Aussies admit to wasting thousands a year amid worsening cost-of-living crisis, Compare The Market, 8 February 2023, accessed 14 February 2023
13. The National Food Waste Summit, undated, accessed 14 February 2023