Written by Calvin Lakhan, Ph.D, Co-Investigator: “The Waste Wiki” – Faculty of Environment and Urban Change at York University
The following is a short excerpt form our most recent study examining consumer attitudes towards packaging, packaging end of life outcomes and sustainable packaging design. This section specifically examines whether there is a willingness on the part of consumers to pay a premium for more sustainable good.
In short, the answer isn’t black and white. Consumers ARE willing to pay a premium, but face financial barriers to participation. Affordability was identified as a significant predictor of purchasing behavior, and while sustainability matters to many shoppers, higher prices deter acting in accordance with consumer values:
Willingness to pay
The results reveal a split consumer perspective – while desire exists to support eco-friendly packaging, cost sensitivities persist. This indicates sustainability has limits as a priority amid budget constraints.
When asked about paying more for recyclability, recycled content, or reduced packaging, only around a third of respondents expressed a clear willingness. The largest segments were uncertain or unwilling to accept higher prices.
For broader viability, sustainable innovations must consider mass market constraints. While some premiums are feasible for green pioneers, capturing majority demand depends on competitiveness with conventional options.
Policy measures like fees, incentives and mandates have roles to play in improving eco-packaging cost structures over time. But near-term, pressure remains on companies to limit trade-off between sustainability and affordability.
Price conscious consumers want greener packaging but remain cost sensitive. Progress will require strategic segments, economies of scale, and systemic solutions steadily narrowing price gaps. If costs converge, purchasing power can truly transform packaging. This affordability barrier could be particularly acute for lower-income groups who spend a larger portion of budgets on essentials like food and household items. Their limited flexibility may hinder some ethical consumption shifts.
The survey results make clear that affordability remains a prime barrier limiting consumer demand for eco-friendly packaging. While sustainability matters to many shoppers, higher prices deter acting in accordance with consumer values.
This cost sensitivity reflects the prevalence of lower-margin households with restricted flexibility to absorb premiums. For them, buying essentials trumps idealism within tight budgets. Even middle-income consumers appear doubtful on paying more for recyclability or reduced packaging given uncertainties surrounding personal benefit. The value exchange seems abstract compared to sacrificing limited income. For sustainable packaging to achieve mainstream viability, competitive pricing is crucial. Companies must innovate to minimize premiums through economies of scale and technological advances.
Policymakers also have a role to play in correcting market flaws that disadvantage sustainable options. Measures like fees on virgin materials, subsidies for recycling infrastructure, and gradual performance mandates could aid cost convergence over time.
In the near-term, producers may need to accept slightly lower margins on eco-friendly packaging to reach mass market price points. Done strategically, this can accelerate needed transitions while benefiting brand reputation. With creative solutions balancing affordability and sustainability, consumers are poised to transform packaging demand. However, realization depends on reducing their green price burden through systemic commitments.
About the Author
Calvin LAKHAN, Ph.D, is currently co-investigator of the “Waste Wiki” project at York University, Faculty of Environment and Urban Change (with Dr. Mark Winfield), a research project devoted to advancing understanding of waste management research and policy in Canada. He holds a Ph.D in Geography from the University of Waterloo/WLU joint geography program, and degrees in economics (BA) and environmental economics (MEs) from York University.
