Sustainability is a significant long-term consumer value. However, the recent cost of living crisis focused people’s attention on economic security, while protecting the environment dropped from its 2021 peak of 16thrank in their most important personal values, to 21st rank last year. But, this is still well above the 2015 level of 25th. (Global GfK Consumer Life study 2023)
With inflation stabilizing and consumers starting to feel better-off compared to 2023, it’s likely that they will turn again to sustainability.
Green legislation: drivers for innovation and pricing
Europe’s energy labels have had a core impact on assortment and innovation. In 2021, the rate of new home appliance products launched was much higher for those that had the new energy labels than for those that did not. Similarly, for products with the new labels, only nine percent of sales last year were of items more than three years past their launch date, while, for products without the new label, that figure is almost 50 percent.
Regulatory interventions influence price trends and drive premiumisation. New, regulation-compliant products are being offered at higher prices, which is driving up the average selling price (ASP) in the respective categories. The recent ban on energy efficiency classes F and G for household appliances is very likely to lead to strong product range rotation and an increase in ASP. In February of this year, refrigerators in these energy classes still accounted for 30 percent of all sales in Europe.
More and more regulations are coming into place as the EU races to achieve the 2030 / 2050 climate goals it has committed to. Most notably, in 2025, a new energy label for smartphones and tablets will become mandatory, which we can ultimately expect to impact assortment and prices.
Beyond energy labels: Eco claims promise success
To understand the success of brands’ eco-claims, GfK started monitoring seven different types of eco-claims. The most common claims are eco packaging, recycled material and CO2 footprint – and laptop vendors are increasingly promoting their products with these three claims. According to gfknewron, 27 percent of sales revenue for laptops sold in EU5 countries* between March 2023 and February 2024 came from products with three or more eco claims – and these products outperformed the negative market with an outstanding triple-digit growth rate!
What does it all mean?
For consumers, the environment is a core, long-term priority that outlives short-term distractions from competing concerns. Leading indicators are already telling us that sustainability will have a stronger consumer voice again this year. Many brands are executing green strategies, and highly aspirational brands in particular have realized the potential to differentiate themselves and justify their price premium by meaningful and genuine eco-initiatives.
*EU5: France, Germany, Great Britain, Italy, Spain