Indian Consumers Ready to Pay More for Sustainable Products: Study

• ByStartupStory     |    November 14, 2023

A recent survey by Bain & Company reveals that over 60% of Indian consumers are willing to pay a premium for sustainable products. 

The study indicates that 52% of urban consumers in India plan to increase spending on eco-friendly brands in the next three years. 

However, barriers such as a nascent understanding of sustainability, high prices, availability issues, and limited sustainable options currently hinder purchasing decisions. While 43% of Indian consumers consider sustainability a top-five purchasing criterion, only 5% of the market share in packaged foods comprises sustainable products.

The report highlights a growing concern for sustainability among Indian consumers, with personal impact due to environmental issues being a key motivator. Despite this, a significant “say-do” gap exists, indicating untapped market potential. Ravi Swarup, Partner at Bain & Company in India, sees sustainable products as a platform with substantial opportunities for consumer companies, presenting value not only for the planet and investors but also for consumers and businesses.

The survey, conducted across the Asia-Pacific region with over 16,000 participants, identifies common barriers to sustainable product adoption. Issues like difficulty in identifying such products, skepticism about sustainability claims, and gaps in product range contribute to a high dropout rate in spite of consumer intent to shop sustainably. 

Moreover, the news emphasizes the rising importance of sustainability for investors globally, with 78% prioritizing Environmental, Social, and Governance (ESG) factors more than five years ago, and 65% foreseeing ESG becoming standard practice in the next five years. Singapore and India have also taken regulatory steps to enhance climate reporting for listed companies.

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