Australian consumers are willing to seek out and pay more for products or services from purpose-led businesses, new research from CommBank suggests.
The CommBank Consumer Insights Report found that 53% of consumers are willing to pay more to buy from purpose-led businesses, while 35% will actively seek them out.
Further, 38% of the surveyed consumers said they are more forgiving towards a business that has an authentic purpose, and they are more likely to regularly shop at (35%) or invest in (31%) purpose-led brands.
According to the research, the pandemic has been the primary driver for more than a third of consumers to reassess their priorities and make deliberate choices about where they shop and what they buy.
"The Report findings show the powerful influence of purpose and how it can increase a consumers’ loyalty, advocacy and spending," Commonwealth Bank executive manager of consumer and diversified industries Jerry Macey said.
"The pandemic has accelerated a shift in Australian consumer habits and we have seen how shoppers are looking for their own values to be reflected back in the brands and businesses they support.
"Despite this trend emerging from the pandemic, the focus on instilling a social purpose will likely continue for the long term.
"Consumers have made it clear they are looking for an authentic, all-encompassing approach that is embraced throughout the organisation," he said.
The report found that younger consumers are the most willing to spend more for purpose-led products/services, with 71% of Gen Z spending more with brands with a purpose.
Meanwhile, only 38% of pre-Boomers are willing to spend more on purpose-led products/services.
However, despite the trend towards businesses with a purpose, value for money still remains a strong indicator for purchase, with 41% of consumers indicating this is a primary driver of shopping behaviour.
Macey added that it is key that a brand's purpose is genuine to ensure loyalty among consumers.
"Purpose is important, but it needs to be authentic in order to add value.
"Today’s consumers are very well informed and can quickly determine whether a brand is genuine about the causes they support.
"Their connections with brands are often personal, and so they are likely to feel personally let down if brands fail them with inauthentic, short-term campaigns," he said.