“We live in fractured and distrustful times and if institutions are failing us, company leaders need not do the same. Control over the products, services and behaviour of companies is in the hands of individuals and it is possible and profitable to do the right thing.” These words, written by Judie Lannon in the editorial of this quarter’s Market Leader, echo a growing sentiment.
David Pearson shares this view: “We need to use our marketing skills to develop new sustainable businesses. There will be new forms of renewable energy and also practices to reduce our usage. Marketers will need to persuade people to live and work in new ways… What I am calling for is a revolution of business practice and consumer behaviour. I have lived through several revolutions and am confident that there will be at least one more.”
Yes, trust has been broken and brands need to search for their souls (even though thinking of them as humans has complications of its own) so it can be restored. But why are we suddenly so pedantic about imbuing brands with personality and considering them as our friends? A few years ago, nobody really cared. It didn’t matter that your bank was a big unfriendly giant ruled by highly paid higher-ups when they were giving out loans to anything that moved. So is trust (much like masculine looks) only important when times are tough? Does it matter what goes on behind closed doors as long as we’re getting what we want?
In any case, companies are responding. If they’re lucky, these processes coincide with their original goal to maximise shareholder value so there’s no need to “sacrifice”. That’s because doing good is seen as a differentiator that positively affects the bottom line. An example I noticed at a mall nearby was a month of trade-ins. Customers came away satisfied from bringing in their old merchandise to qualify for discounts on computer equipment or designer jeans (and the companies got to enjoy the tax deductions when these were donated, which unsurprisingly happened right at the end of the fiscal year).
For Goodness Sake!
What about the other side? How likely is it that we as consumers will do the “right” thing when money is tight and we need to think of ourselves? All this talk about green being the new black (we’ve been through so many colours already, you’d think black would be the new black by now) seems a little much. Much of it is based on surveys to determine purchase intention and willingness to pay premiums, even though this only correlates to actual behaviour 30% of the time (see reference below). It’s as though we’ll say whatever we think sounds right in an interview and then do something else entirely when the time comes.
Dr Anne Sharp and Kate Newstead capture it well in Green Brand Fatigue: “Many studies do show that most people value ‘buy local’ and ‘go green’ sentiments. But these attitudes correlate poorly with actual in-store behaviour. This isn’t to say that consumers don’t care about green benefits at all. It’s just that the average shopper is a cognitive miser who purchases quickly and automatically. And despite the best of intentions to prioritise green products, what ends up in the shopping trolley is usually based on habit and unconscious processing, rather than on rational decisions.”
Like with brands, the ideal situation is when what benefits the environment happens to benefits the individual (e.g. installing efficient lighting to save on your electric bill) or doesn’t cost the individual anything (e.g. having a company make a donation if you tweet their message). The ideal situation is to have products from good companies that deliver sustainable benefits at fair prices. But would consumers really choose to save the planet over saving what little money they have if it came to making a choice?
For example, if two laundry detergents cost the same, would you opt for the eco-friendly one if the other works better? What if they worked equally well but the regular one cost substantially less? This is similar to the principle in finance of choosing the stock with the higher return (performance) if both have the same risk (cost) and choosing the stock with the lower risk if both have the same return.
As the article continues: “Stamping ‘green’ on the side of the box is no get-out-of-jail-free card. Who wants to buy an Apple computer just because it’s shipped in a smaller box? But, if it still delivers on speed, software and aesthetics, and is shipped in a smaller box, then this can be the added value for the consumer that encourages them to choose that brand.” That’s where the gold lies.
(For more, see ‘Do Intentions Really Predict Behaviour?’, Journal of Marketing, 2005)