At SB’21 San Diego, leaders in food, retail, finance, healthcare, pet care and more shared lessons learned from a variety of initiatives aimed at moving the needle on consumer behavior change.
This is one of a series of posts filled with insights gained from dozens of industry leaders, practitioners and innovators on a variety of themes at SB’21 San Diego. Read more insights on supply chain optimization, product and business model innovation, brand storytelling and more …
That elusive slice of pie: BFG, NRS, Petco, Sustana on satisfying consumer appetites
More than ever, consumers can envision themselves taking social and environmental action. The challenge is moving them from envisioning to actual action, and brands are poised to help push them over the threshold.
A Monday morning panel at SB’21 San Diego discussed new ways that companies are leveraging consumer insights for good. Rachel Whitacre, Manager of SB’s Brands for Good (BFG) collaborative, opened the discussion with several insights.
Recent BFG research found that 96 percent of consumers are trying to make sustainable decisions at least some of the time. Heeding this data can be lucrative: 85 percent of consumers are loyal to brands that help them achieve better, more balanced lives.
“Brands have the opportunity to lead the way by both showing and actively creating options for consumers that make sustainable behaviors accessible and aspirational as part of the mainstream,” Whitacre said.
Consumers are mired in a polarized world, said Susannah Enkema, VP of Research & Insights at Shelton Group. The same values that can get you seen as a “good” company can also get you labeled as a “bad” company.
What do all “good” brands have in common? Criteria include treating employees fairly, excellent customer service, and providing a quality product. Aside from these, 23 percent of survey respondents said ESG-related criteria informed their choices to purchase from a particular brand.
The key is identifying values and holding true.
“We are no longer living in a world where everybody is going to appeal to everyone,” Enkema said. “It is increasingly important to know what your mission is, who you are appealing to, and how you reach them.”
Enkema shared five practical steps in becoming a “good” company and winning in the court of public opinion:
- Decide what you’re trying to accomplish
- Determine what goals fit your brand
- Treat employees well
- Stay committed to goals for the long haul
- Tell your story, build trust, and leverage resources
NRS: The value of values
Case in point: Idaho-based Northwest River Supplies (NRS) provides river-ready kayaking, paddleboarding and angling equipment to outdoor enthusiasts and outfitters across the nation. It needed hard, actionable numbers to quantify its secret sauce and bottle it for sale.
Through a recent analysis, NRS discovered it’s on par with its competitors in terms of quality and price — so, it doubled down on marketing its values as a differentiator.
The study found that sustainable products enjoy a 10-30 percent increase in consumer preference. What’s more, there’s a 10 percent uptick in preference even after a 10 percent increase in price for a sustainable product, translating into a 6-7 percent boost in revenue for companies that bake value into products.
Buying decisions are sliced up like a pie, explained Mark Deming, NRS’ Director of Marketing. After standard value factors, there’s a sliver left for social and environmental values. NRS has found it’s usually that last slice that convinces consumers to make a purchase.
For Petco, sustainability isn’t a whole other animal
For Petco, sustainability means looking at what humans are doing and extrapolating the trends for pets. The drive to reduce human footprint mirrors reducing pawprints.
Eleni Kardaras, Petco’s Customer & Market Insights Manager, found that pet parents value sustainability in high-use pet items, a trend mirrored in the human consumption world. Cory Skuldt of Corporate Citizenship helped Petco crunch its sustainability numbers, and highlighted the power of small decisions to leverage massive change in value chains.
“[Sustainability commitment] enables Petco to be a catalyst for change for the entire pet industry,” she said. “We’re planning on bringing the entire industry along with us on this journey.”
Regeneration: ‘The essence of expression’
Regeneration is the theme of SB ‘21, and Emily Olson of Sustana Group and ReGenFriends quickly laid out a definition (a definition, she admits, was stolen from Carol Sanford): “Evolving capacity for essence expression.”
Through her work at Sustana and ReGenFriends, Olson is exploring how to deepen capacity for the fullest expression of people and systems. She’s seeing Sanford’s definition of regeneration coming to fruition in surveys, expressed by respondents’ descriptions of “regeneration” and how they think brands should express it:
- 76 percent valued reducing carbon footprint
- 70 percent valued social impact transparency
- 87 percent valued innovative products and services
- 77 percent valued transparency about environmental impact
Sustana also polled consumers about definitions of regenerative business. Responses evoked aspirations of going beyond neutral, safeguarding future generations, and creating a business model for the future. If product prices stayed the same, over three-quarters of those surveyed said they’d buy the product. If the prices were higher, 46 percent said they’d still buy.
A regenerative mindset, carried with innovative thinking, is key to bridging the gap between customer aspiration and brands with a purpose.
Key stakeholders as agents of regeneration
Later in the week, an energizing cluster of keynotes on day three at SB’21 San Diego provided glimpses into a wide variety of inspiring stakeholder-engagement initiatives.
Cultural anthropologist Philip McKenzie opened the plenary by calling on brands to enter a new type of social contract, one based on stewardship values and regenerative principles. This would help power a framework that centers both people and planet, altering the way humans think, see, act and exist in the world.
“The current social contract isn’t broken; but none of us signed up for it,” McKenzie said. “It needs to work – not for the owners, but for the rest of us.”
Continuing this theme, Simon Mainwaring, founder and CEO of We First, stressed that businesses were not moving fast enough – or far enough – to address the world’s most pertinent issues. He said many companies put self-limiting parameters on their ambitions such as working with familiar suppliers or customers, potentially restricting the scale of achievable impact: “This results in isolated pockets of good intentions.”
Mooting the idea of collaborative leadership and collective purpose, Mainwaring talked of a virtuous spiral, or hierarchy, that brands could aspire to. This starts on an individual level, adopting a “lead with we” mindset (the subject of his new book); before moving up onto other levels that center around leadership, company, community, society and ultimately transcendence — which is about restoring harmony between humanity and the natural world.
Cyrus Wadia, head of product sustainability at Amazon, then spoke of the importance of mobilizing customers to drive positive change. Amazon’s Climate Pledge Friendly shopping program, which launched a year ago, is designed to help customers discover and shop for more sustainable products; it has since grown to encompass over 200,000 products and 37 certifications.
“We are realizing that customers are ready and signaling with their purchases what they want to see,” Wadia said. “Give citizens and customers alike something they can believe in, and they can move this system. I’m optimistic about our future ability to make that change because of the customer.”
Brand firepower comes in many different forms, as illustrated by Deluxe Chief Brand Officer Amanda Brinkman’s talk. As a provider of marketing services for small businesses, Deluxe wanted to raise its profile by using its ‘do well by doing good’ motto as a springboard for action.
“Our way of doing well would be to do good for small businesses, to inspire more people to support them. On our 100-year anniversary, we wanted to tell the stories of 100 small businesses across America,” she said.
The result was Deluxe’s Emmy-nominated series, “Small Business Revolution,” which showcases inspiring stories of small businesses helping to revitalize the towns and communities they operate in. “When you invest in a small business, and take brand action to go out and help them, you can see a ripple effect through the entire community,” Brinkman said.
Ensuring that your brand remains relevant is an ongoing challenge for many sustainability leaders, especially if the brand in question has been around for a long time.
L-R: Nancy Mahon, Katie Decker and Angelica Beard (moderator)
Speaking from experience, Katie Decker, global president for essential health and sustainability at Johnson & Johnson Consumer Health, said, “When you think of Johnson & Johnson, you don’t think about sustainability or sustainable products. We took a hard look at ourselves and asked, ‘what do we need to do to remain relevant?’”
The answer lay in understanding what united the company and its people – this led to the company’s Healthy Lives Mission, which launched last year. “It’s our health, trying to make people’s lives healthier. But you can’t have healthy people without a healthy planet – that was our rallying cry,” Decker told attendees.
Such initiatives often rely on an ability to drive organizational change. Nancy Mahon, SVP for global corporate citizenship and sustainability at The Estée Lauder Companies, emphasized the importance of empathy here.
“Where are you driving value, and how do you show up? That is going to be very different for the HR department versus the R&D department. Then you need understand what are the levers of change for your organization. Lastly, you need to focus and prioritize,” she said.
The latter half of the plenary had a strong focus on sustainable consumption. Looking to the future of our country’s food system, AppHarvest CEO Jonathan Webb asserted the importance of controlled-environment agriculture, which he predicted would come to the fore ten years from now.
“Farming is broken. Climate disruption has already hit us in the face on agriculture … our food supply is dangerously unstable,” he warned.
According to Webb, the solution lies in combining innovative technology with natural resources and farming know-how to produce more with less. AppHarvest’s indoor farms in Kentucky, for instance, use up to 90 percent less water than open-field agriculture and run on recycled rainwater.
With food being a great connector for people, Heidi Hackemer, executive creative director at Oatly, advised brands to take advantage of that and open some emotional doors.
“Oatmilk is great compared to dairy, but sustainability is boring — it’s not exactly the stuff that consumers are super excited to engage with,” she said.
Oatly’s ‘emotional door’ approach involves creating interesting gateways that get people intrigued or psyched about something, thus helping to bring them into more complicated conversations. An emotional door can come from great user design or user experience, for example.
“It’s not about how your company talks about sustainability, it’s about how people want to hear about sustainability,” Hackemer told delegates.
According to Mathias Wikström, CEO of Doconomy, consumers are key to solutions as they can drive more conscious consumption. “We need to connect consumption to its impact on the planet … it’s all about making those mindful decisions,” he said.
Doconomy’s partnership with Mastercard offers a new approach to environmentally informed spending by helping users estimate the carbon footprint of their purchases. Speaking about the rationale behind the carbon calculator, Kristina Kloberdanz, chief sustainability officer at Mastercard, said that while her company’s carbon footprint wasn’t that significant, the reach and scale of its influence is huge.
“Individuals are looking to see how they can make a difference — we did some research and found that 85 percent of adults are willing to take climate action,” she told delegates.
Taking a stand on social issues is just as critical. Nick O’Flaherty, director of UNSTUCK at the Tent Partnership for Refugees (TPR), spoke of his organization’s work in bringing brands, consumers and suppliers together to create jobs for refugees.
With many refugees now in a state of limbo or displacement for longer periods of time, the case to economically integrate them has grown stronger, O’Flaherty said. TPR developed UNSTUCK to scale up its job creation work, partnering with brands to create products sourced from suppliers who hire refugees.
“We are harnessing the power of the market to create the change and impact that we seek,” O’Flaherty said, adding that by buying UNSTUCK products, consumers can help support this job creation.
He also highlighted the business benefits of recruiting people who are fleeing or have been displaced, such as increasing workforce diversity and employee engagement: “It also helps builds brand integrity, which is what young consumers are looking for — brands who take a stand on social issues.”
This article first appeared in cmocouncil.org
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