Green products in China have become intensely successful in the past few years. Despite recent China’s highly polluting environment, the green voice is gaining increasing attention. Awareness of pollution and healthcare problems have transformed consumer’s habits significantly. Chinese markets are integrating this new pattern into their strategy and pay more attention to this global phenomenon, shifting towards green products at a very high pace. A recent regional research survey highlighted that on average 84% of consumers are prepared to pay 27% more for green products in China.
Green products in China request by NGOs and the Government
This awareness is arising from the 3,500 environmental NGOs in China that have been blooming lately. The NGO, Friends of Nature is playing a major role and is precisely orientating consumers in choosing a green product, creating “blacklists” and developing concrete awareness actions.
The other main actor participating in the fast development of green products is the government. A first large action was undertaken in 2007, when the Communist Party Congress called for a change of all actors of Chinese companies to behave in a more environment-friendly way. A year later, an environment protection ministry was created and has been producing measures to regulate unacceptable behaviors. This year the government went a step further by choosing Energy efficiency amongst the top priorities for 2015 and the next five years. China defined clear targets enabling to overcome the challenge of maintaining at the same time such a remarkable rapid economy expansion and more eco-friendly industries. Matching policies promoting green products in China are being undertaken. Subsidies are available for energy saving products, depending on the consumption of the product. Also, advantageous tax rates for low pollution vehicles are practiced.
Large preference of consumers for green products
This trend is visible in every field, surveys over the market show the Chinese have learned to protect the environment by daily attention. The habit of saving water, food, and electricity is increasingly practiced in households. Easy and effective actions are undertaken with routine. The survey also found out that business ethics are ranked amongst the top three items that customers pay attention to when choosing a product. However, this comes from the fact that the Chinese are purchasing green products in order to protect their own health and safety since scandals concerning the food and medical industry frequently occur. The environmental sustainability characteristic of a product is only ranked after personal health and safety. A perfect example to this statement is the French premium water, Evian that has been extremely successful those last years by branding themselves with health and purity regardless of the expenses and pollution of transportation.
Trend of “Buying Green” still looking for appropriate supply
In 2008, China Daily had already noticed the huge opportunity that represented the green products in China by stating “This provides great direction to companies planning to develop global sustainability solutions that help both their business and the environment.”(China Daily October 6, 2008) And indeed, seven years later we can find out that there is a real trend of buying green products.
However, there is currently a large lack of supply of green products in China. A gap of 44% is estimated since the demand for those goods is increasing intensely fast.
But according to XuShufan, deputy head of the science, technology and standards department of the Environmental Protection Ministry China’s environmental protection industry can be reached fast “But the industry still needs more investment from the market, rather than simply waiting for governmental investment”
The National Survey on Environmental Protection Industry presented that in China the proportion of environmental products sales revenues essentially held by the water and the air pollution control products. They account for 80,2% of the sales revenues together. Those results show the main concerns of the Chinese are water and air, which are the most common and wildly spread danger for their health. For the moment, many sectors are waiting to awaken and set off with the population awareness concerning pollution and the global challenge of global warming.
Daxue Consulting Expertise
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