New research from Vlerick Business School reveals that South Korea and Singapore have the highest willingness to pay for brands that prioritise sustainability and inclusivity.
The study, conducted by Professor Frank Goedertier of Vlerick Business School, Professor Bert Weijters of Ghent University, and Joeri Van den Bergh, Co-founder of Human8 and Adjunct Professor at Vlerick Business School, offers insights into global consumer preferences.
The research, which surveyed 24,798 individuals across 20 countries and Hong Kong, highlights a significant disparity in consumer willingness to pay for sustainable and inclusive brands versus exclusive and on-trend brands. South Korea and Singapore emerged as the top countries where consumers are most willing to support sustainable and inclusive brands financially.
Conversely, the study found that consumers in China, South Africa, and Thailand exhibit the highest willingness to pay for exclusive and trendy brands. European countries, including Belgium, Germany, The Netherlands, Sweden, and the United Kingdom, showed the least willingness to pay for more sustainable and inclusive brands.
Generational and Gender-Based Insights
The study reveals notable generational differences in consumer behaviour. Gen Z consumers are significantly more inclined to pay a premium for brands that focus on sustainability and inclusivity compared to older generations. Interestingly, Gen Z also values exclusivity and trendiness more than older generations, indicating a dual preference for ethical practices and high-status products.
In contrast, Gen X and Baby Boomers show a lower willingness to pay for both sustainable/inclusive and exclusive/on-trend brands. Additionally, women demonstrate a higher willingness to pay for inclusive, sustainable brands but a lower willingness to pay for exclusive, on-trend brands compared to men.
Implications for Businesses and Marketers
Professor Goedertier emphasises the practical applications of these findings: “Our findings can help businesses and marketers optimise their brand positioning strategies. For companies aiming to attract the Gen Z market, the traditional focus on exclusivity alone may not suffice. Gen Z consumers are drawn to brands that make a positive impact and promote inclusivity across various demographics.”
Companies with a significant female consumer base may benefit from emphasising sustainability and ethical practices in their branding strategies. The study suggests that diverse preferences for inclusivity, sustainability, exclusivity, and trendiness across different geographies and generations should inform business and marketing strategies.
The research underscores the importance of understanding consumer preferences in a rapidly changing market. Businesses aiming to stay competitive must adapt their strategies to meet the evolving demands of their target demographics. As Gen Z continues to grow as a significant consumer segment, brands that balance ethical practices with trendiness are likely to thrive.
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