Clients are tired of companies that pretend to care. Retailers need to be genuine in their altruistic claims or embrace the fact that they’re driven by profits. Time is up for retailers that attempt to convince consumers they’re in business for the greater good, when really, they’re just in it for the money. There’s nothing wrong with a business making money, of course.
We all recognise that, outside of certain unprofitable but richly funded tech start-ups, a firm won’t survive long unless it’s capable of generating sufficient revenue to continue functioning.
What are consumers fed up with?
What the public’s fed up with, is companies that attempt to grow market share and win consumers’ loyalty by making false claims about how environmentally friendly, socially conscious and all-round ‘woke’ they are. The consumer is tired of hypocrisy and duplicity.
We want to buy from people we like. We favour retailers that share our values — retailers that are genuine, sincere and honest. When a business betrays our trust, we get angry.
For the offending company, this can have serious repercussions. Shoppers will not only vote with their wallets (28% of consumers have stopped buying certain products due to ethical or environmental concerns, according to a recent research report from Deloitte).
They will also voice frustrations via social media. The result: not only reduced revenue, but potentially a damaged reputation, which is more difficult to recover.
Nevertheless, many businesses persist in cynical virtue signaling — making public statements intended to demonstrate good character and an ethical approach to certain issues, when in truth, they take little action in those areas. It’s foolish, because inevitably, they’ll be caught.
The authorities are now getting serious about identifying and punishing businesses that make false claims of corporate social responsibility (CSR). These businesses are being held accountable; environmental, social and governance (ESG) claims are being measured and companies are being forced to become increasingly transparent, backing up their assertions.
Here in Australia, the Australian Competition and Consumer Commission (ACCC) is handing out very large fines to businesses pushing credentials that could give them an unfair advantage over the competition in making sales. Consumers, meanwhile, are becoming as adept at the regulators at spotting bullshit retailers and seeing through their bullshit claims.
What is an honest mission or cause?
When a company is genuinely passionate about a specific cause, often you can trace that belief all the way back to the founders’ story, perhaps even before they started the business — you can see that they have woven it into their culture since day one.
A great example is Australian fashion company, Outland Denim. It was founded in 2016 with the goal of providing training and fairly paid employment for survivors of human trafficking in Cambodia, while manufacturing garments in a sustainable, less impactful manner.
A certified B Corp, this company’s higher purpose beyond simply selling product was integrated into the way it was structured from the very start. Conversely, a bright neon sign starts flashing ‘bullshit’ when a retailer, out of the blue, begins vocally expressing concern about a particular issue that as far as anyone can see, hadn’t been on their agenda.
Yes, business leaders can and do undergo changes of heart or perspective, leading them to naturally grow to believe in a cause. (For instance, male executives frequently revise their outlook on gender equality when they become fathers to daughters.)
But in those cases, a gradual evolution will be observed in the company’s stance in that area, rather than a dramatic change where out of the blue, they begin broadcasting their enthusiastic support for a particular social or environmental cause at every opportunity.
How can companies keep it real?
It’s an excellent indicator of authentic commitment to a cause when a company publicly acknowledges its own shortfalls and sets out to correct them. Eco-friendly coffee pod company Urban Brew had always offered biodegradable pods, but recognised the need to go a step further to ensure that empties finding their way to landfill would break down.
The brand recently announced its migration to fully compostable pods, even though this change, they openly advised will increase the cost of their products for consumers.
When eco-friendly ecommerce business Seed & Sprout (dubbed Australia’s Green Online Retailer of the Year by Finder for the second year in a row in 2021) discovered that despite their best efforts, some of their products contained palm oil, they publicly admitted their mistake and replaced that product line with one that was coconut oil based.
The company also made a $50,000 donation to the Orangutan Alliance, supporting its international palm oil free certification program. Consumers increasingly favor ethical and sustainable businesses — 54% of direct-brand shoppers prefer to buy from companies they know are sustainable, according to the Australian Ecommerce Report 2021.
The same report noted that brand proof points including being socially responsible and environmentally friendly had become compelling reasons for purchasing direct from a brand.
Kathmandu, a certified B Corp and one of Australia’s most prominent sustainability-conscious companies, last year launched the world’s first biodegradable fleece jacket, it aims to create four such eco-friendly material innovations annually.
A 2020 study of 8,000 consumers across eight countries (USA, Canada, the UK, France, China, India, Singapore and Malaysia) found that “global consumers are four to six times more likely to trust, buy, champion and protect those companies with a strong purpose over those with a weaker one”. There are clear advantages to being a company with a cause.
As Jeff Bezos might tell you, there is absolutely no shame in operating a company with no loftier a goal than to run a successful business. That can be your cause. All the consumer asks is that you be honest about it, don’t pretend that you’re out to save the world. Don’t bullshit.