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Now more than ever, businesses have the opportunity to grow their bottom line by doing good. Consumers prefer sustainable products and will use their buying power to support environmentally responsible companies — 91 percent of millennials say they are willing to switch to a brand that champions a cause, and 84 percent of all Americans consider sustainability when making purchases.
As this younger cohort of purpose-driven spenders matures into their role as the largest consumer bloc in the United States, it’s important for small and large businesses to capture their purchasing power by communicating a sustainability story.
Climate change awareness has slowly but surely informed the habits of millennials and Generation Z, who are increasingly choosing green products and services. Simply put, customers today demand that businesses do more for society than just create great products.
A study published by Cone Communications, a public relations firm specializing in corporate social responsibility (CSR) media and research, found that nearly nine in 10 U.S. consumers are somewhat or very likely to switch to a brand supporting a good cause — compared with just two-thirds of respondents in the survey’s first year, 1993.
This study also found that 87 percent of people try to spend in accordance with their values. The research makes clear that a growing majority of consumers are up for grabs for those companies trying to do good.
Large companies have taken notice of this preference shift, embracing sustainably sourced products and environmentally friendly services. Starbucks, for example, has invested heavily in its Greener Retail initiative, which aims to minimize their retail space environmental footprint during the construction phase and through continued operational efficiencies.
Adidas began selling a running shoe made with recycled plastic waste, Walmart is working to limit their global value chain emissions to less than one gigaton per year by 2030 and 7-Eleven is offsetting up to 30 percent of emissions from gasoline sales across the country. These companies are mobilizing because of the environmental impact and because they’ve listened to their customers — and their stock prices have also benefitted.
Summarizing the business impact of sustainability, Kantar’s Purpose 2020 report concluded that brands recognized for their strong commitment to purpose grew at twice the rate of others during the previous 12 years.
Critical to that finding is the element of recognition. These companies succeeded because they were widely known for doing good and communicated their efforts. For a sustainability program to boost your company, customers need to know about it.
“It’s important for small and large businesses to capture the purchasing power of purpose-driven spenders by communicating a sustainability story.”
The power of sustainable practices driving customer loyalty and returns is real, so how can your business share the message with customers who care?
To get started, assess your company’s current slate of sustainable practices. If you’re already taking action, create an inventory of programs worth promoting. If not, determine where you might be able to make a change without breaking the bank, and then proceed to action.
Simple places to begin include installing LED lighting and low-flow plumbing, which decreases both your energy and water consumption. Strengthen your sustainability initiatives with action outside of the office, too, by providing a bike rack and encouraging employees to commute in alternative ways. Reach out to vendors to replace conventional items such as plastic bags with eco-friendly products.
Research what your vendors are doing in terms of sustainability, and add their accomplishments to your list. Additionally, you might also consider engaging with local nonprofits to give back through volunteer projects, sponsorships and commitments.
Once you have your programs in place, spread the word. Express to customers and partners your commitment to the environment and giving back to your community. Put up signs in your store or office and on your website.
If you sell a physical good, make sure the packaging comes with branding that clearly showcases your commitment to sustainability. Post to social media with highlights and progress updates of your most notable programs and goals.
“Brands recognized for their strong commitment to purpose grew at twice the rate of others during the previous 12 years.”
Of course, these are the first critical steps — but there is still further action available to break away from the pack and capture the power of purpose-driven consumers. These differentiators, known as strategic sustainability practices, are “reliably, consistently and significantly associated with superior performance,” according to a recent Harvard Business Review analysis.
For example, calculating your organization’s total impact and investing in carbon offsets is an accessible strategic practice for businesses interested in participating in a zero-emissions future. These offsets, which are purchasable counterbalances to your carbon footprint, support investments in projects such as renewable energy procurement and reforestation on your behalf.
When you invest in carbon offsets, you can let your customers know about emissions-free shipping, which limits the environmental cost of consumption.
It’s paramount for companies today to create, market and support a narrative that resonates with climate-conscious customers. While taking the first steps might seem daunting, a growing amount of research on consumer habits and business performance shows that your company stands to do well by doing good — now get started on your sustainability journey.
GreenPrint is a 2019 Engage portfolio company. Engage is an independent venture fund, of which UPS is a limited partner. The venture fund helps drive innovation by supporting startups and growth stage companies.
Photo by Reuben Juarez/Unsplash
Longitudes explores and navigates the trends reshaping the global economy and the way we’ll live in the world of tomorrow: logistics, technology, e-commerce, trade and sustainability. Which path will you take?