Brands can’t push sustainability to the bottom of the list
While many shoppers are hunting for bargains in freshly opened stores right now, an increasing number are also searching online for information about your company’s supply chain ethics, materials life cycle, ingredients provenance and overall impact. Most of this information is available through official or unofficial channels these days and all of it is quickly shared at the click of a button or tap of a screen.
A reputational fail may be more likely than ever for brands who aren’t creating meaningful ESG (environmental, social and corporate governance) targets but we are still at a point where there is a distinct difference between what consumers demand from brands and what they are willing to pay for, with reports indicating that most rarely wanting to pay more for items of greater sustainability. This may lead some brands to feel that they can ignore a sustainability just a little bit longer. Not so fast.
If you’re reading this, you are likely one of thousands of business leaders who have been feverishly reading about Gen Z behaviours for years now. As they increasingly exercise their buying power, they are making choices about their spending and long term loyalty, based on how aligned they feel with a brand’s purpose. They may not be ready to spend more right now but they do expect more from the brands they buy from.
As a brand doing business today, you’ve got the opportunity to be a leader, taking your customers with you on a journey to sustainability while also providing value that balances cost and impact. Investing in sustainable solutions for your business is, of course, simply the right thing to do, but outside pressure helps. For publicly listed brands, shareholders have been central to progress for example, as they increasingly demand accountability from CEOs. As of this year, almost half of the FTSE 100 committed to linking executive pay to ESG targets.
In 2020, well-known industry visionaries like Ikea, Patagonia and Unilever continued to be recognised as sustainability leaders by the Globescan/SustainAbility Leaders Survey. For Unilever, it was an impressive 10th consecutive year in pole position and there also have been exciting new additions to the list, like Microsoft, Ørsted, L’Oréal and Tata.
What can others learn from these companies and how can they effectively communicate their reduced impact to consumers to ensure long-term brand preference? The biggest lesson must be that a top-down approach is crucial to ensure that sustainability sits at the heart of everything a business does.
In 2020, thanks to investment, innovation and internal alignment, Nespresso CEO Guillaume le Cunff expedited its 10-year sustainability plan with a promise to deliver carbon neutral cups of coffee by 2022. Recycled aluminium capsules were quickly introduced and this is just the start. It’s a big step forward for a company whose competitors had previously detailed the negative impact that Nespresso’s aluminium capsules have on our planet (despite an impressive recycling programme).
Another route to success lies in collaborating with brands operating in the same sphere to make it better for everyone. In April 2020, coffee industry leaders Nestlé (Nespresso’s parent company) and Jacobs Douwe Egberts UK announced the launch of a frictionless multi-brand pod recycling scheme called ‘Podback’. This UK-based inter-company collaboration is a refreshing reminder that taking responsibility is bigger than scrapping over market share. If anything, this initiative will likely increase brand loyalty for both.
In 2020, the British Retail Consortium’s Climate Action Roadmap highlighted 60 leading retailers that share the common goal of bringing the retail industry and its supply chain to net zero by 2040. The roadmap sets out five areas of action required by brands. Of particular interest is the commitment to “help customers and employees live low carbon lifestyles” taking a behind-the-scenes approach to carbon neutrality and putting it firmly in all of our hands, reaffirming that positive change is everyone’s responsibility.
As with any large-scale business initiative, there are many ways to reach the finish line, so pick something and focus on it. An identified goal, aligned strategies and a clear rollout plan, will inevitably lead to progressive, positive impact...and impact is now surely the most important, if not the only, metric for consumers to judge by.
At Honest. by Principle, we find that more clients are asking for innovative, sustainable solutions to their challenges. We are partnering with brands across visual identity, communications, packaging, retail environments and experiential spaces to bring strategic creativity to life in an engaging and responsible way. There isn’t a formulaic approach to problem solving and one size definitely does not fit all when it comes to doing the right thing, but with every completed project, it is humbling to know that our contribution to positive change forms part of much bigger, and much needed global movement.
By Michael Melmoe, Business Partner