Skip to main content
BoF Logo

The Business of Fashion

Agenda-setting intelligence, analysis and advice for the global fashion community.

The Wealthy Are Less Willing to Spend on Sustainable Products

Millennial and Gen-Z respondents were among the most likely to pay a premium for environmental-friendly practices.
Factory producing pollution.
Millennial and Gen-Z respondents were among the most likely to pay a premium for environmental-friendly practices. (Shutterstock)

Innovation to create sustainable beauty and fashion products and their packaging can be costly. But it’s not the wealthiest consumers that are the most interested in spending for eco-friendly practices, according to a new study by venture studio and brand incubator Squared Circles. The company has invested in brands like Nutrafol, which sold to Unilever, and $135-sweatshirt brand Pangaia.

The new research report, out on April 22, finds that over half of its 3,000 survey respondents are willing to make lifestyle changes to support sustainability. Sixty-four percent of those surveyed said they “recognise the need to compromise the way we live to ensure sustainability.” But that number drops when it comes to paying higher prices for sustainable products and practices, especially among consumers in a higher income bracket.

A chart showing the data on US consumers' willingness to spend on sustainable products.

Among the surveyed group, 52 percent would be willing to pay 10 percent more for a sustainable product. But when taking out responses by anyone with a household income below at least $100,000, that percentage drops to less than half at 45 percent.

“The more wealthy this consumer is, the more they scrutinise, interestingly enough, how they spend their hard-earned money,” said Lukas Derksen, co-founder of Squared Circles.

ADVERTISEMENT

Gen X respondents were especially wary of sustainable products. Dividing its respondents into four psychographic groups, “Conscious Maximalists,” “Passive Activists,” “Checked Out” and “Modest Means,” the Gen X-dominant “Conscious Maximalist” segment was 27 percent more likely than average to strongly agree with the statement, “sustainable products don’t live up to the hype.”

However, the youngest segment of surveyed consumers was more willing to spend on sustainability than all age groups surveyed. Among the mainly 18-to-45-year-old “Passive Activists” profile, 76 percent believe that a company should be able to charge 10 percent more for a sustainable product, and 70 percent are willing to buy it. The rates for those making more and less than $100,000 were similar for this group, and 74 percent overall agreed that we must compromise our lifestyle for sustainability.

But one area of sustainability where most consumers said they are not willing to sacrifice is quality. Only 35 percent said they would be willing to buy a product with lower performance if it was more sustainable.

Learn more:

Don’t Believe What Consumers Say When It Comes to Sustainability

A growing body of consumer surveys suggests interest in sustainable consumption is reaching a tipping point. Those surveys are deeply flawed, writes Kenneth P. Pucker.

Editor’s note: An update on Apr. 22, 2024 changed “venture capital firm” to “venture studio.”

© 2024 The Business of Fashion. All rights reserved. For more information read our Terms & Conditions

More from Sustainability
How fashion can do better for people and the planet.

Is Fashion Serious About Sustainability?

At fashion’s annual sustainability gathering in Copenhagen, the biggest question was why, after 15 years of discussion, so little has changed and whether a coming tsunami of government regulation can force the industry to evolve its practices.


view more

Subscribe to the BoF Daily Digest

The essential daily round-up of fashion news, analysis, and breaking news alerts.

The Business of Fashion

Agenda-setting intelligence, analysis and advice for the global fashion community.
CONNECT WITH US ON
© 2024 The Business of Fashion. All rights reserved. For more information read our Terms & Conditions, Privacy Policy, Cookie Policy and Accessibility Statement.