There may be a perception that a large number of U.S. consumers are willing to pay more for goods and services from socially responsible companies, but a global Nielsen study of 58 countries finds Americans right in the middle of the list.
The percentage of American consumers who agree or strongly agree that they should buy from socially responsible companies in 2013 is 44%, ranking the country 28th among the 58 surveyed. The percentage increased from 36% in 2011, when U.S. consumers ranked 30th.
The jump is important. Sponsorship consultancy IEG estimates that cause marketing funding by companies totaled $1.7 billion in 2012 in North America alone, and project an increase for 2013.
"While cause marketing programs seem to resonate most strongly among younger respondents, the rapid change among middle-aged consumers expands the cause opportunity for brands," says Nic Covey, VP of corporate social responsibility at Nielsen. "Today, brands can confidently focus purpose messaging on both younger and older consumers."
That's not to say the U.S. doesn't have some catching up to do. That 44% places it far behind India, the country with the highest percentage of socially responsible consumers at 75%, followed by the Philippines with 71%, Thailand at 68% and Indonesia with 66%.
In South America, Peru has the largest-percentage of consumers who would spend more on products from socially responsible countries with 62%. In Eastern Europe, Bulgaria tops the list with 53%.
Other countries of note: China, 59%; Brazil, 55%; Italy and Israel, 44%; Spain, 40%; Germany and Canada, 38%; the U.K., 32%; France, 31%; and Russia, 29%. Holding down the bottom post is Estonia with 27%.
Overall, Nielsen found that 50% of global consumers are willing to pay more to buy from socially responsible companies, up from 45% in 2011, with 74% of the 58 countries surveyed showing increases.
Nielsen surveyed more than 29,000 Internet respondents in those 58 countries between Feb. 18 and March 8, 2013. While numbers confirmed that younger consumers under age 30 are most likely to say they would spend more to buy from socially responsible companies, the survey found a sizable jump among consumers age 40-44. In that demo group, about 50% agree that they would pay more, up from 38% in 2011.
Other older consumer demos also showed growth in the percentages. The 45-49 age group grew from 39% to 47%; the 50-54 group increased from 37% to 48%; the 55-59 group grew from 38% to 43%; and the 60-64 age group grew from 33% to 42%.
Geography As Deciding Factor
Geography clearly affected the consumer thought process, with respondents in several Far and Middle Eastern countries being more likely to pay more for goods from socially responsible companies, while consumers in most European countries being less willing to do so.
"In countries where skepticism toward corporate social responsibility runs high, cause marketers face an uphill battle," Covey says. "In these markets especially, social impact programs must be incontestably authentic to a company's business objectives, vision and values."
Nielsen also looked at "intent to spend more going forward" vs. "how many actually did spend" on socially responsible companies over the past six months. Overall, 43% of those surveyed worldwide said they actually had rewarded socially responsible companies by spending more over the previous six months. And that figure is 7% less than the percentage of those who said they would be willing going forward. Nielsen also points out that the survey did not delve into how many opportunities consumers had to actually make a choice of spending with a socially responsible company.
Breaking it out by age group, the largest percentage of consumers who spent more over the prior six months was in the 25-29 year old age group, with 52%.
"Today, the question is not whether consumers care about social impact, but which ones, how much and how to appeal to them," Covey says. "The answer isn't necessarily a traditional cause-marketing campaign. General responsibility, sustainable innovation and purpose messaging might also engage these consumers. No matter the approach, savvy brands are figuring out how to hit this nerve."