For decades, price, quality, and convenience have been the principal drivers of consumer purchasing decisions. Today, those drivers are competing with another important motivator: health. But while some companies like Starbucks, Target, CVS, and Unilever are recognizing this consumer trend, other companies may be lagging behind because the “business case” for health just isn’t clear. Indeed, there is a dearth of information on what consumers expect from companies, and how much purchasing behavior is motivated by positively impacting the health of consumers, employees, and communities.

To encourage more companies to act, we need real evidence that supports their potential investments in promoting better health. In addition, the current lens of corporate sustainability used by socially responsible investors—which centers on environmental, social, and governance themes, or ESG—does not consider health explicitly. To encourage investors to take this step, we need data that incorporates the voice of the consumer and highlights the influence of health on their purchasing behavior.

To fill that knowledge gap, the Robert Wood Johnson Foundation looked to Mission Measurement to study how companies’ efforts around the environment, social impact, governance, and health (what we call “ESG-H”) influence the everyday purchasing behavior of US consumers.

Our study surveyed 23,800 US consumers to learn about their purchasing decisions across nearly two-dozen categories and about their views on 400 major brands.

  • Between 11-28 percent of an average consumer’s purchasing decision is driven by ESG-H factors, depending on the category.
  • The emergence of health, an oft-overlooked factor. On average across all categories, consumers ranked health as 50 percent more influential than environment, driving 3-8 percent of consumer choice alone.
  • ESG-H considerations were most influential among the most sought-after demographic groups: millennials, females, people of color, and people living in cities.
  • In competitive categories where there is little or no differentiation on price and convenience (such as typical fast food chains or homecare products), ESG-H factors can play an important role.
  •  In certain categories, brands that perform better on ESG-H factors tend to have significantly higher growth.

Read the full article about investing in health by Jason Saul, John Hoeppner, and Marjorie Paloma at Stanford Social Innovation Review.