Today's customers expect it all when buying a product. With so many options online, they have the ability to choose where their money goes, and they are choosing to support purpose-led businesses.
When breaking down the data of a recent report by IBM, The buying motives of shoppers can be categorized as follows:
44% purpose and values (of the business they are buying from)
37% cost and convenience
15% company branding
4% product features
This means that conscious, aka values-led, consumers now make up the largest consumer segment globally.
Traditionally businesses have seen that offering the cheapest price has been a great sales strategy. While this can be an excellent way to bring new customers over the line. There are some far more impactful strategies versus using discounts for customer loyalty.
And it gets even more exciting - more good news for brands committed to making this world an awesome place:
87% of Millennial and 94% percent of Gen Z expect companies to address social and environmental issues.
70% of shoppers will switch to more socially and environmentally sustainable brands
78% of shoppers will recommend products from a business with a socially-driven mission to their network
What does it mean to be a values-led shopper?
Consumers today see their buying habits as an extension of their values. With the ability to control which businesses to support, they are, in essence, voting with their money.
If your business values align with those of the conscious consumer, then they will buy from you. If not, they will move on to your competition.
But it does not end there. if your business values actually go against those of the conscious consumer. They will not only boycott your company but encourage their friends (and followers) to do the same.
Who are values-led shoppers?
In truth, conscious consumerism exists among all age brackets. A report from Nielsen shows that 75% of younger generations and 51% of baby boomers are willing to spend more on sustainable products.
In recent years we have seen increased buying power (and influence) from Gen Z. A generation that was raised with access to more information than any other previous generation. They know more about products than their predecessors and thus have higher expectations putting more importance on values beyond traditional company branding.
There was a time when everything you knew about a company was what they told you in their advertisements. Thankfully this is no longer the case.
What do conscious consumers want?
In short, they do not want to give good money to bad people.
This includes all aspects of a business from where the materials come from to the banking institutions that they partner with
“Every time you spend money, you're casting a vote for the kind of world you want.” - Anna Lappe
The biggest value for consumers in recent years has been environmental sustainability with 80% of global consumers saying that both sustainability and health are the most important when it comes to choosing brands.
More consumers are choosing to support companies that are better for the planet. This means offsetting carbon emissions and producing less waste.
It is not by chance that large corporations like Amazon, Nike, and Microsoft all started advertising net-zero goals within a year of each other. This is an example of green marketing or cause marketing.
But net zero is not enough anymore. Consumers expect every company to be net zero, and are not looking beyond into the social aspects of ESG.
This means that customers care about a company's policies and stances on everything from gender equality and diversity to the mental health of their employees.
Why should businesses care?
If you have read this far I think it is pretty obvious, however, there are more reasons for a business to look into conscious consumers.
Not only are they the biggest segment, and not only will they spend up to 70% more on products that align with their values (IBM 2022).
But conscious consumers are also more likely than any other buying group to purchase 'extra' items when shopping. This means that if a conscious consumer goes to your brand to purchase an item, they are more likely to add additional items to a cart
If a large demographic who is less price sensitive and more likely to add items to a cart is not enough. Just consider the passion of these shoppers.
When they find brands that align with their values, they will be extremely loyal. This means that they will both come back to your store and are likely to be strong brand ambassadors ... which means bringing in more of these passionate consumers via free word-of-mouth marketing.
What should retailers do?
Start showing the world that you are a good business supporting good values.
If you are not telling consumers what you think as a business they will simply assume that you do not care about a topic.
49% of customers assume that if a company isn't posting about their causes they simply don't care. - Porter Novelli 2021
Just make sure that anything you do or speak to is authentic to your brand. Greenwashing and virtue signalling won't fly.
While there are many ways to get started, one of the easiest is to start supporting a cause that aligns with your values, and there is no faster and easier way to do that than with the Virtue Shopify App.
That's it for now! Shoot me a message if you ever want to chat about #esg #csr #retail or if you want to know more about Virtue.
Westen from Virtue
Support Causes from sales with store and checkout donations. Virtue is an easy to set up fundraising app for eCommerce brands built on Shopify, WooCommerce and Magento.
