Sustainability takes back seat as inflation forces consumers to prioritize affordability in consumption choices

GLOBAL –  As the cost-of-living crisis makes it more difficult for consumers to buy basic essentials, many people are putting affordability at the front and centre of their consumption choices, according to data released by the EY Future Consumer Index.

The survey, which questioned 21,000 consumers across 27 countries including China, France, Brazil, South Africa and the UK, found that for 35% of them affordability was the top priority, up from 25% in October 2022.

Most consumers – 94% – are worried about the rising cost of living. In a food-specific context, 79% of consumers feel that food prices have increased within the last 3-4 months.

This departs from a previous trend where consumers incorporated sustainability into their purchasing decision, preferring products with higher sustainability credentials over others.

Out of the five consumer segments, “planet first,” saw the biggest decrease, going from 25% of consumers to 16% (the others being “experience first,” “society first,” “health first” and “affordability first”).

Globally, “planet first” remained above “society first” and “experience first” in consumer priorities, but took a clear back seat to “health first” and “affordability first”.

 In Europe, it was the UK, Sweden and Finland who saw the biggest decline in consumer concern about sustainability, according to Kristina Rogers, EY Global Consumer Leader.

“For example, UK respondents switching to sustainable alternatives has declined from 56% to 50% while those making purchasing decisions based on environmental impact has declined from 56% to 51%,” Rogers revealed.

“Those who think that businesses must ensure that all their suppliers meet high standards in regard to social and environmental practices has declined from 76% to 67%.”

Overall, consumers’ concerns about affordability meant that sustainability suffered significantly as a priority.

Desire for sustainability hindered by cost of living

Despite this trend, consumers remain just as concerned about sustainability as before in some areas, sometimes even more.

In both November and May, 79% of consumers have said that they try to repurpose or recycle products after use, and 83% of consumers have said that they try to conserve water.

However, there is a significant overall decrease in concerns about sustainability, especially when it comes to the bigger questions.

 In November 2022, 53% of consumers said that purchasing and behaving sustainably is a “guiding principle” of their lives, compared to 51% in May 2023.

In November, 60% of consumers said they would pay more attention to the environmental impact of their consumption, compared with 59% in May.

Perhaps more importantly, in November 44% of consumers were willing to pay more if a product was sustainable, compared to 42% in May.

As of November 67% of consumers were deterred by high prices from buying sustainable products, while in May 68% were this shows just how much the cost-of-living crisis is having a significant impact on sustainability.

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