Chinese Consumers Will Go Green -- but Not if Doing So Is Expensive

Many on Mainland Have Environmental Concerns, but Few Pay Premium Prices for Nonfood Products

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BEIJING (AdAge.com) -- China's environment gets worse by the day, no surprise to residents who sputter to work every morning through congested city streets and dense smog. But so far, Chinese have been slow to help out at the checkout counter.
China: Home to 16 of the most polluted cities on the planet, according to one group.
China: Home to 16 of the most polluted cities on the planet, according to one group.

"There is a reasonable level of consciousness about the environment," said Darryl Andrew, managing director, China, of Synovate in Shanghai. "But the majority of Chinese aren't prepared to pay a premium for products that are marketed on an environmentally friendly platform."

In a recent survey of 14,220 respondents in 21 countries about climate change, the Aegis Group-owned research company discovered consumers in some of China's largest cities show even greater concern about some environmental issues than their Western counterparts.

For example, 68.5% of respondents in China said they were "very concerned" or "somewhat concerned" about the effects of global climate change. That's about equal to the global average and higher than in the U.S., where only 57% of people surveyed showed the same level of concern.

Economic priorities
In China, that concern makes sense. The deputy director of China's State Environmental Protection Administration, Pan Yue, last month admitted publicly that the situation is deteriorating. China has 16 of the world's 20 most polluted cities, according to the Worldwatch Institute in Washington. The government is concerned, but its desire to continue China's economic growth and a lack of technology to improve conditions have limited its effectiveness.

More than 96% of Chinese interviewed by Synovate claimed to have "personally done something to reduce the effects of climate change in the past year." The most common actions were reducing water consumption (77.1%), saving power (76.8%), buying "green" products (76%), and using less plastic packaging and bags (62.5%). Nearly 58% of Chinese respondents had bought an energy-efficient device.

Many of these answers greatly exceed the responses of respondents in Western countries. But they also exceed the actual behavior of Chinese
Darryl Andrew, managing director, China, of Synovate in Shanghai, says most Chinese consumers aren't willing to pay more for environmentally friendly products.
Darryl Andrew, managing director, China, of Synovate in Shanghai, says most Chinese consumers aren't willing to pay more for environmentally friendly products.

"Chinese are not becoming green," said Tom Doctoroff, JWT's CEO, China, and area director, Northeast Asia, in Shanghai. "[They are] increasingly aware of the linkage between environmental friendliness and economic efficiency and, as a result, advocates. But in China, whenever you talk of values or even morals, nothing hits hard unless it hits their pocketbook."

Dangerous food
Or their stomachs. Chinese are growing -- understandably -- more concerned about the safety of local food products. The recent deaths of American pets that ate food contaminated with a Chinese-made ingredient is "the tip of the iceberg for what's sold in China," said P.T. Black, a partner at marketing consultancy Jigsaw, Shanghai. Compared with problems with exported goods, the proliferation of unsafe or contaminated products "is much worse inside China. People here die all the time. In this situation, a 'green' product is anything that gives consumers some quality assurance."

Another survey conducted last year by Jigsaw and ad agency Bartle Bogle Hegarty indicated that 67% of adults aged 15 to 35 in China's tier-one cities would buy organic food even if it cost 25% more than nonorganic food. Retailers such as Carrefour have set up organic-food sections.

A handful of multinationals are taking the initiative. General Electric, for example, has developed an "Ecomagination" campaign with BBDO Worldwide, Shanghai, related to its sponsorship of the Olympic Games in Beijing next year. Aimed at business executives in China, it presents GE as a global company that can help solve some of the world's toughest problems through clean alternatives such as water reuse, wind turbines, cleaner coal and solar power. Procter & Gamble Co. picked up a coveted government-issued water-conservation certificate for its Lenor fabric softener, which uses less water than other laundry products.
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