11 November 2014

Yes, consumers do care

In the 60’s, consumers stopped buying South African goods as a protest against apartheid. In the 80’s, consumers boycotted Nestlé's products due to their "aggressive marketing" of breast milk substitutes, in the developing countries. Today, consumers still use their power through boycotts of products and regimes, but these seem not to have a great impact on business turnover.

However, more than ever, consumers use their buying power to promote sustainable products and behavior. A growing consumer segment is demanding greater insight and information on the origin of the product. This consumer segment wants to know how the products is made, what it is made of, where it is made and by whom. And they increasingly expect companies to help address society’s financial, social and environmental challenges. Sustainability has the power to speak to the heart – and as companies and brands what we want is exactly to create an emotional attachment.

This specially goes for the younger generation. A global survey conducted by Deloitte among 7800 Millennials (those born in 1983 or later) shows that although 74% believe companies generally impact the communities in which they operate positively, almost the same amount expect companies to do more than they do now to alleviate the problems that society faces.

Today consumers’ brand loyalty is much more linked to the sustainability performance of the company than ever seen before. Nine out of ten consumers want to hear about companies’ sustainability efforts. Seven out of ten say they consider company transparency when they do their shopping and eight out of ten consumers want to be engaged in companies’ sustainability efforts.

So how do companies meet these new growing demands? For the past two years we have been eager to understand how to use the sustainability agenda to engage the consumer in a differentiating experience. We have analyzed consumer trends and we have looked at more than 100 global business models and cases engaging consumers.

Let me present you four frameworks of how to engage consumers in the sustainability agenda:

Transparency engagement

  • This framework conceptualizes the pursuit of increased customer engagement through open dialogue and complete, easily accessible, intelligible and often interactive disclosure of information on business (and often supply chain related) activities.

Partnership engagement

  • This type of engagement frames efforts of seeking enhanced customer involvement and engagement in corporate partnerships with civil society organizations or non-governmental organizations around issues of social and/or environmental sustainability.

Life-cycle engagement

  • In life-cycle engagement the involvement denotes engagement approaches aiming to extend and alter customers’ role and involvement in the life-cycle of products in and beyond the purchase phase and the use phase of products (cf. ‘circular consumption’).

Collaborative engagement

  • Finally, ‘collaborative engagement’ defines engagement models completely upending the relationship between suppliers and customers – be it e.g. by making the customer the supplier of products as well (cf. ‘the sharing economy’), the co-designer of products (cf. ‘open source innovation’), or the user, but never the owner, of products (cf. ‘functions sales’).

Research and frameworks shows clearly that Sustainability can be used as a powerful tool to engage consumers in a positive way that creates brand loyalty and attachment to the brand. However, it clearly can’t be just a marketing exercise – companies need to have a strong sustainability performance to back it up.

Anne Mette Christiansen
Partneri, Deloitte Sustainability