Asian consumers go green

13 January 2011

SINGAPORE: Brand owners are failing to match the demand for green products observable among consumers in China, India and Singapore, a new study shows.

TÜV SÜD, the services group, surveyed 2,600 adults and 460 senior executives to gain insights into attitudes and behaviours covering this area.

It reported that 74% of customers in these three markets claimed to have previously bought items boasting strong eco-friendly credentials.

A further 84% would pay a premium for relevant goods and services, including 94% of the Chinese cohort, 86% of Indians and 72% of Singaporeans.

Chinese respondents outlined a willingness to support a 45% price rise to obtain such products, a proportion standing at 24% in India and 11% in Singapore, an average of 27%.

Overall, 96% of shoppers and 89% of the companies serving them had an interest in green brands.

But a gap appeared between the popular commitment to this emerging sector and the perceptions of manufacturers dealing with this audience.

More specifically, a 43% minority of companies thought consumers would be willing to spend more.

On average, this group believed customers would be willing to spend 14% more on green products.

Only 35% of companies based in Singapore believed customers might accept higher costs to buy such brands.

Corporations in India posted the same score, which rose to 60% with reference to Chinese firms, albeit still 34 percentage points behind the figure actually delivered by potential buyers.

This may be one contributing factor meaning that just 43% of the featured organisations currently sold products with an environmental positioning.

Variation did exist between countries, with 67% of Chinese food and beverage specialists active in this category, falling to 16% in India.

Totals reached 41% and 30% in turn for apparel and footwear, TÜV SÜD said.

An additional 74% of the business panel argued their firm either had not created or effectively communicated its official stance and strategy relating to the environment.

For 81% of Chinese enterprises, these initiatives primarily resulted from industry or governmental regulation, measured against 67% concerning Singapore and 55% regarding India.

TÜV SÜD asserted that a huge growth opportunity was being missed as a consequence of such hesitancy.

Half of interviewees were aware of independent certification standards and 42% suggested accreditations are "very important", compared to 43% and 15% among companies respectively.

Elsewhere, 96% of the Indian public sample agreed the certification of goods could exert an influence on purchase decisions, beating China's 94% and Singapore's 90%.

"Consumers in China, India and Singapore have become increasingly sophisticated when it comes to green issues," said Ishan Palit, ceo, TÜV SÜD Asia Pacific.

"Businesses, on the other hand, appear to be slow on the uptake. This is surprising; especially considering the demand is there."

Data sourced from TÜV SÜD; additional content by Warc staff