By Anastasia Lloyd-Wallis
Head of Insights, Retail Doctor Group
Why should companies take environmental and social issues seriously? With recent crisis, far from being a passing fad, it seems that this will be the best way to have a sustainable business over time. We are facing unprecedented times of change, experiencing major transformations in consumption habits and the way we do business driven by digitalization, the impact of the pandemic, as well as by customers who have never been as socially and environmentally conscious as they are now.
Consumers are asking for more transparency and more responsibility from companies, whether they are brand manufacturers or retailers, since they want to feel part of something superior when buying from a brand. A connected and empowered customer, as well as an increasing number of investors, demand that businesses do well for society and the planet, and thus it increasingly becomes a survival company priority.
85% of global consumers consider sustainable practices by brands and retailers to be important (Retail Doctor Group/ Ebeltoft Global Consumer Study, 2020). But as a retailer how do you know where to start and what to do?
It is time to change, but how?
Many retailers talk about sustainability, but not all of them seemed to be coherent between what they preach and what they do, and consumers can see through this.
It is thus becoming increasingly important for any company to act responsibly, as well as explaining those initiatives, so people are aware of them and act accordingly. Society is now demanding more transparency and accountability, yet there is a huge lack of awareness. Customers are now fond of brands with strong social values and respect for the environment. They want to feel a connection with brands they trust, and which share their values. They also deserve to be able to distinguish between what is just greenwashing versus a true social and environmental commitment.
An increasing number of conscious consumers are demanding and choosing brands with values and a higher purpose. 44% of consumers have chosen to buy products from a company with sustainability efforts rather than from a competitor not known for addressing them, with most Millennials (53%) acting more consciously driven when purchasing.
There is much confusion from retailers about what they should be doing from an environmental and ethical standpoint.
So how do retailers know where to start?.…. Listen to your customers, listen to yourself.
The options available to retailers in this area are many and often confusing, understanding what is authentic to your company and brand values is key. Customers want a genuine position that both echoes your brand and their beliefs.
Whilst we can’t be all things to all people, listening to what is important to your customers is crucial. What will make them keep returning to your business? And what is putting them off?
There are many retailers leading the way with their sustainability efforts by choosing what matters to them and their customers and making it a large part of their day to day business. Social and ethical responsibility increasingly appear in many forms in retail from activism (think Ben & Jerry’s and Patagonia), to businesses born to solve a problem (e.g. zero waste grocery retail), different business models (where we see employees put first over everything else), right down to big retailers looking at all aspects of their process to see where they can influence the sustainability (e.g. no plastic, solar power, Fairtrade)
Understanding your sustainable contribution and ethical stance is critical for all retailers, aligning this with your authentic brand values and customer needs is key. With customers and investors increasingly looking for retailers that have a strong and authentic set of values, this will become crucial for future survival.
Retail Doctor Group in partnership with Ebeltoft Group has research some of the retailers and key initiatives leading the charge in this space. The proprietary white paper can be downloaded here
To understand your consumers needs, drivers and behaviours and how this affects your retail strategy and omni-channel implementation contact RDG Insights division [email protected]