The Economics of Kindness

To get the public's view on the economics of kindness, Baringa commissioned a global survey to understand how perceptions of kindness affect purchasing decisions.

In the last 2 years, 61% of surveyed consumers said they refused to buy a product/service because they felt a company was unkind.

We learned these decisions are made on more than price and service alone. This is a crucial insight for business leaders: when setting strategies, firms should increasingly consider kindness alongside more traditional concerns such as price.

To what degree do you consider the behaviour of a company and its leadership when making a new purchase?

A company's behaviour is one of the factors consumers weigh up when buying products or services.

"In a connected age where the consequences of business decisions are instantly transmitted worldwide, people are faster to make moral judgements about firms, and to act on those judgements."

Guy Dent, partner, expert in Products and Services at Baringa

Kindness in a downturn

 

Thinking about the current economic downturn, which of the following statements apply to your behaviour?

When wallets get stretched, consumers continue to value kindness.

Across the board, a majority of consumers said they were willing to choose a kind company even where there was a financial penalty for doing so.


If a company were known to have the following attributes, how would that make you respond to the company?

  I would avoid buying their product or service if the price was the same I would avoid buying their product or service even if the price was cheaper I would not avoid buying their product or service
They were known to treat their suppliers poorly 45% 52% 12%
They were known to treat their staff poorly 44% 53% 12%
Their customer service is notoriously poor 45% 51% 12%
They behave in a dishonest way towards customers* 44% 56% 10%
They were known to be involved in cruel behaviour with animals 45% 55% 12%
They have acted unethically towards the communities in which they operate 43% 54% 12%
They had recently laid off large numbers of staff 40% 41% 25%

*such as charging hidden fees, or employing misleading information or forceful behaviour

"The assumption is that when times get tough, 'ethical' choices become a luxury and people make decisions based on price. But the increased awareness of unkind business practices might be changing this. As we head into a possible recession, we are seeing more people prepared to take a financial hit to choose kind firms, often in an act of solidarity."

Guy Dent, partner, expert in Consumer Products and Services at Baringa

The international picture

Australia

Chart: 65% of Australian consumers refused to buy from a company they felt was unkind

Chart: Factors consumers "always consider" when making a purchase in Australia

Germany

Chart: 68% of German consumers refused to buy a product or service from a company they felt was unkind

Chart: Factors consumers "always consider" when making a purchase in Germany
Netherlands
Chart: 52% of Dutch consumers refused to buy a product or service from a company they felt was unkind

Chart: Factors consumers "always consider" when making a purchase in the Netherlands

When asked to what extent they consider factors often associated with “kindness” when making a purchase, consumers from the Netherlands consistently the least likely to weigh up a firm's kindness before purchasing.

"Dutch consumer behaviours can be different from those of other nations. Our donations to charity barely dip in tough economic times. We top the charts in terms of unpaid volunteer work. But on the other hand, as regards the private sector, the Dutch quickly adjust spending, with price trumping everything else."

Marcel Volkerts, expert in energy networks at Baringa

Singapore
Chart: 63% of Singapore consumers refused to buy a product or service from a company they felt was unkind

Chart: Factors consumers "always consider" when making a purchase in Singapore

Switzerland

Chart: 70% of Swiss consumers refused to buy a product or service from a company they felt was unkind

Chart: Factors consumers "always consider" when making a purchase in Switzerland

United Kingdom
Chart: 50% of British consumers refused to buy a product or service from a company they felt was unkind

Chart: Factors consumers "always consider" when making a purchase in the UK

United States

Chart: 57% of American consumers refused to buy a product or service from a company they felt was unkind

Chart: Factors consumers "always consider" when making a purchase in the US

When asked to what extent they consider factors often associated with “kindness” when making a purchase, consumers from the USA were consistently the most likely to weigh up a firm's kindness before purchasing.

"Since its inception the USA has been an activist country. We have a cultural assumption that individuals have the power to make change happen, and this makes American consumers more likely to see and consider the consequences and choices in our individual purchases."

Jeff Hartigan, partner, expert in Consumer Products and Services at Baringa.

Methodology

The research was conducted by independent market research consultancy, Censuswide. The survey was conducted online with 6,028 employed consumers who have either a pension or some kind of investment in Australia, Germany, Netherlands, Singapore, Switzerland, the UK or the US, between 26.04.2023 - 04.05.2023. Censuswide abide by and employ members of the Market Research Society, which is based on the ESOMAR principles, and are members of the British Polling Council.

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