Authors: Rebecca Brody – Strategy Director at The Lab Insight & Strategy
Femi Hardwick-Slack – Associate Director at Nature Research
Recently, the topic of ecological sustainability can no longer be ignored. Given the utterances of public figures such as Greta Thunberg, Prince Harry and David Attenborough, nationwide protests and an increasingly intense and urgent tone in news and social media, it is not surprising that many brands are paying attention and attention.
Countless articles have been written on consumer demand for “green” products and services, highlighting the growing importance that Australians attach to sustainability and their alleged intent to buy / take advantage of green products. There is no doubt that there is a strong mainstream sentiment: 62% of Australians say they value sustainability more than 12 months ago, and an average of 4 out of 10 state that environmental considerations come to mind when buying consumer goods. However, many brands have found that this does not always lead to action. Sustainable products and services often get a subdued response from consumers. Even in cases where brands have made consumers understand the types of sustainable properties (e.g. recycled materials, packaging, sustainable fabrics, etc.) they want to see and then have created a tailored offer the reaction on the shelf often turned out to be unconvincing.
Consumers certainly expect brands to act sustainably and embed them in their offerings and practices. 58% of Australians expect big brands to set an example, and 52% believe that all companies should do everything to be environmentally friendly. According to their own statements, however, consumers cannot rely on the fact that they always make sustainable decisions (especially when buying). 8 out of 10 say they don't do as much as they could. Why is that? And how can companies prepare for the best chance of success given the significant sustainability requirements for investments that are often required and ensure that their efforts are effective?
To shed light on this, Nature & The Lab Strategy conducted an online survey of 2,000 Australians and conducted a cultural analysis of news and social media posts over the past 12 months. We found the following.
Sustainable decisions are more likely to be made when it is appropriate (and there is something for the consumer).
When it comes to action, there is clearly a dynamic: 61% of Australians say they are doing more in this area than they did 12 months ago. Using wastepaper baskets, taking bags with you to the supermarket, and turning off the lights when you leave a room are common practices that are facilitated by simple implementation, constant reminders, and often cost-saving benefits. However, when it comes to sustainable shopping, more effort and compromise is often required, which creates obstacles. Many consumers are also challenged by a lack of knowledge about sustainability and brand claims that they find confusing. What is crucial is that the costs represent a significant hurdle, with many pointing to higher prices as the main reason for the unsustainable purchase.
Does this mean that brands can't expect consumers to make sustainable decisions, especially when there is a price premium?
On a positive note, there is a way. The evidence suggests that consumers are often ready to put their money where their mouth is when a sustainable offer is properly formulated.
How can this be achieved? We have identified three important areas of influence.
Build a strong, sustainable value proposition
Our study found that when consumers paid more for a sustainable product alternative, in most cases they saw other associated benefits (outside of positive environmental benefits). These benefits vary by category, but include attributes such as superior quality, taste, naturalness, health, and aesthetic properties associated with the sustainable offering. This shows that consumers do not look at sustainability in isolation – they often assess the “value” that a sustainable product represents. This can be tangible or perceptible, with status often playing an important, influential role. Brands like Keep Cup and Tom Organic have done this particularly effectively by not only embedding environmental friendliness in their products, but also taking advantage of the associated product benefits that consumers appreciate.
The brands that promote consumer response the most are often those that make sustainability a strong value proposition. The key to this is to identify the most relevant and effective drivers that can be coupled with sustainability and combined with effective clues / messages to create a compelling “sustainable” package that takes advantage of the underlying needs and desires of consumers turns out to be stronger than altruism alone.
Use behavior economy
Behavioral economics can offer some useful strategies to effectively influence consumers and lead them to more sustainable decisions. One of several principles that we examined in our study is the "defaults" principle. This is based on the idea that a default approach that takes effect when nothing is specified will drive people to the desired behavior when there is inactivity or difficulty choosing.
We tested the effect by putting the participants in a scenario that simulates an online hotel booking. All participants were asked by the hotel to compensate for their stay for $ 3.03 a night. However, the wording of this sentence was different.
Group A had a choice and radio buttons "Yes, please add $ 3.03 per night to my bill" or "No, thanks".
Group B also had the choice of opting for or leaving the initiative, but this time with standard framing. Instead, the buttons were labeled "click to confirm support" or "click to remove" with the corresponding green and red shades.
The results show that standard framing in Group B had a significant impact as participants who opted for carbon offset for their stay increased by 51%.
This is just one example – there are other BE principles that can be applied effectively to achieve more sustainable results. By further exploring these options and testing them against their own initiatives, brands can use simple impulses to optimize sustained efforts and achieve better results.
Lead with certainty
In the past 12 months, discussions about the environment and sustainability have become particularly heated and full of anger, guilt and increasing frustration. These associations mean that many brands are cautious to get involved and fear they will find themselves in a divisive narrative that could negatively impact their image.
Australians are also getting tired of antagonistic and partisan political rhetoric. 43% are particularly negative about the government's response to the bushfires and therefore have no confidence in their ability to drive the necessary changes. Many are now looking for brands to pave the way and find a clear path through education and influence.
This takes shape of a new narrative – one that is based on optimism. Many local B-Corps and mainstream brands move the tone in an uplifting direction, focusing on inclusiveness and positive collective impact, rather than blaming the Australians for their behavior. Studies have shown that individuals need to feel ethical and not feel guilty to be environmentally friendly. Positivity therefore offers a much more effective way of impact and a more brand-friendly way to weigh an important issue.
While sustainability is a daunting and challenging place for navigation for brands, it can no longer be left alone. The good news is that by building relevant insights and testing new approaches that are impacted, brands can turn challenges into opportunities and have positive impacts that benefit everyone.
