The battle for the values-driven customer
Back in the mid 90s, I was leading the comms team for the UK launch of Microsoft’s much anticipated Windows 95 operating system. We were busy positioning it as a truly revolutionary, innovative concept – a graphical user interface for your operating system which allowed you to use your computer more intuitively using icons for navigation instead of a command line of text. Apple Computer however, took issue with this, and argued they’d been taking just this approach with their Mac for many years. Over in the rival PR camp, they came up with the bright idea of sending t-shirts to the media we were targeting emblazoned with the slogan ‘Been There, Done That’. It was a humiliating blow.
I was reminded of this clever little tactic a couple of weeks ago when the venerable Business Roundtable, a group of CEOs from some of the largest companies in the US, declared in a Statement of Collective Purpose that they were committing to lead their companies for the first time not purely or primarily for shareholder interest, but instead “for the benefit of all stakeholders, including customers, employees, suppliers and communities”.
I was interested to see the BCorporation Community’s response to this news. BCorps are a group of businesses around the world who have signed up to an agreement which legally requires them not only to consider the impact of their decisions on their workers, customers, suppliers, community and the environment but also to use business as a ’force for good’, which will ‘do no harm and be of benefit to all’.
First, BCorp took an ad out in the New York Times welcoming the declaration from the Business Roundtable, which had more than a whiff of the ‘welcome to the party, but what took you so long?’ about it. And then came a more direct op-ed in Fast Company magazine, warning the big guns that rhetoric is not enough, and only when they turn their words into actions will customers take them seriously.
This shot across the boughs got me thinking about the almighty battle that is building up between the smaller, purpose-led businesses which have acted as disruptors and innovators, and some of the world’s largest and best-loved brands. The former, tapping into the zeitgeist of social and environmental responsibility that younger generation customers in particular have been demanding, are offering a new social contract between business and society. They are bringing fresh business models which focus on concepts like the Circular Economy and the Shared Services to rival the old model of make-use-dispose and endless consumption to fuel endless growth.
The latter group, having spotted the growing opportunity with the ‘values-driven consumer’, are busy realigning their enormous marketing budgets and buying up or creating new purpose-led brands to win the hearts and minds of this ethically minded group of purchasers. We’ve seen companies like Unilever bring start-up brands to market such as Love Beauty and Planet solely to tap into these ‘conscious consumers’; in the US, their Seventh Generation eco-cleaning brand recently gave over their ad spend to 350.org to help support the September Global Climate Strike protests. There are numerous other examples of big brands ‘going ethical’, from Nike’s use of Colin Kaepernick in its ad campaigns to show solidarity with his views on police brutality against black people in the US, to Coca-Cola changing its iconic drinks can to all-white to draw attention to the plight of polar bears in the Arctic due to climate change.
It is clear that to date, where big brand conglomerates have enjoyed success in this sector is in purchasing brands with a strong existing ethical heritage (Ben & Jerry’s, Ella’s Kitchen, Pukka Herbs, Innocent Drinks etc) and letting them stay independently run. What is unproven is whether values-driven consumers will be attracted to mainstream brands which have always stood for profits and mass consumption.
There is no doubt that the large multinational community wants a slice of the purpose-led market. The question is – can these Goliaths win over the same type of customers who are drawn towards the Davids of the BCorp world?
The answer probably lies in understanding the true motivations and priorities of this group of customers. And since I count myself part of this group, I’ll hazard a few guesses here. For me, part of the attraction of purchasing from smaller, purpose-led brands is their specialism and clear focus on tackling the particular social or environmental issues they’ve chosen to centre on. For instance, I buy my washing detergent from ECover because they have a clear mission proven over 30 years around eliminating harmful pollutants from the washing process. It feels good to support a company which has been brave enough to offer something different even when it was for a niche market for many years. Also, crucially, their products work. I’m prepared to pay a premium for this, because I can’t see any other brands that offer the same integrity of product at a lower price.
So, what would it take to make me consider buying a similar product from, say, P&G if they introduced one? Perhaps if it were available in a new packaging format – perhaps in a refill – and was super convenient, say via subscription such as Loop, as well as being available at a good price. Or maybe if it was recommended to me by someone within my trusted circle of ethical and sustainable influencers. But my sense is they are going to have to work hard to convince me to trade in my existing brand loyalties, and to prove they are serious about ethical business and there is authenticity in their brand’s purpose.
Ultimately though, where this battle is taking us is away from the traditional ‘race to the bottom’ where purely profit-led businesses have often been accused of going, and instead more towards a ‘race to the top’. The perfect storm of more stringent customer, employee and community demands, fuelled by serious competition from the gamechangers such at BCorps, sets the social and environmental impact bar ever higher, which can only lead to better the outcomes for society and the planet.
Which as far as I’m concerned means we should bring it on – and let the battle commence.