The Ultimate Guide to Conscious Consumption Welcome to Latana’s Ultimate Guide to Conscious Consumption! Do you buy fair-trade chocolate, drink coffee from ethically-sourced beans, and eat organic vegetables? Maybe you make a point of wearing cruelty-free clothing and using vegan cosmetics? Choosing which products to buy and which companies to support — and which to avoid — is known as conscious consumerism or conscious consumption. In 2022, consumer habits are changing and more people than ever are using their purchasing power for good. With so many consumers rethinking their priorities since the pandemic, brands need to keep up with changes in how values and ethics shape customer behavior. Read on to learn more about the mindset behind conscious consumption, what it means for brands, and how it will impact future consumer behavior. Table of Contents Introduction to Conscious Consumption What is Conscious Consumption? Is Conscious Consumption Right for Your Brand? How Would Conscious Consumption Improve Your Relationship With Consumers? How to Embrace Conscious Consumption Tips For Embracing Conscious Consumption %1 Understand your target audienc9 1 Be transparent, and do what you ca4 1 Audit external partner? T1 Review your brand messaging How Top Brands Use a Conscious Consumption Approach to Marketing Levis Adidas Tony’s Chocolonely Lush Conclusion What’s Next? C h a p t e r 1 C h a p t e r 2 C h a p t e r 3 Introduction to Conscious Consumption C h a p t e r 1 What is Conscious Consumption? C h a p t e r 1 Conscious consumption is the act of supporting companies and products we agree with socially, ethically, or philosophically. It comes from increased awareness of the impact our purchasing decisions have on the environment, society, and our health. The idea behind conscious consumerism is to use purchasing power to invoke positive change and help balance out the negative aspects of consumerism. It promotes responsible production processes, eco-friendly materials and manufacturing processes, as well as fair pay and working conditions for employees. It can involve purchasing eco-friendly, high-quality goods — or purchasing less, such as forgoing air travel or choosing used items, such as pre-loved fashion. There are many ways for consumers to vote with their wallets and use their buying power for good. Research from Deloitte shows that 61% of consumers avoid single-use plastics, almost half purchase seasonal produce and support local businesses, and a third have stopped buying brands or products due to sustainability concerns. Conscious consumption isn’t really new. Consumer movements to combat unfair labor practices, ensure product safety, and promote fair competition in the market date back to the 19th and 20th centuries in industrialized countries like the UK and US. However, recent events have brought responsible consumerism to the forefront. With the pandemic encouraging consumers to support small, local businesses over large corporations, fast fashion being criticized for exploitative practices, shortages of raw materials due to recent conflicts, and wildfires ravaging the US and Australia — consumers are becoming increasingly aware of what they are buying and who they are buying it from. Is Conscious Consumption Right for Your Brand? Today, every brand needs to consider consumers’ priorities — aka the impact consumerism has on the environment and society. Many consumers believe that brands have a responsibility towards society, but it’s not just about moral and ethical reasoning. It’s good for business. Being sustainable is an essential element of building and preserving a strong brand and developing trust among customers — which, in turn, fuels business growth. However, it’s important to carefully consider your brand values and brand mission. A solid understanding of your target audience and brand messaging is essential to ensure consistency. Keep in mind, if you’re an oil company, a fast-fashion brand, or a budget airline — customers are unlikely to believe that you are a role model of sustainability and are having a 100% positive impact on the planet. The good news is that consumers typically respond well to honesty. If you’re not completely sustainable or eco-friendly yet, but you are making changes to get there, it’s best to be transparent and be honest about the steps you are taking — as well as what still needs to be done. If a brand tries to exaggerate how environmentally friendly it is, this could be perceived as “greenwashing”, which would have a negative impact on your brand’s reputation credibility. Remember, we’re living in times of unparalleled transparency. It’s very easy for customers to check how sustainable your business is and verify whether your brand is acting in an ethical way. Websites like Good On You, Done Good, and Project Just reveal how a brand deals with issues such as treatment of employees, sourcing, and usage of materials and waste. Open Secrets shows if a company has donated money to charity or supports a good cause. And with the growth of social media, a brand can be “canceled” overnight if they are found to be acting irresponsibly and unsustainably. Conscious consumption represents one of the biggest trends and shifts in consumer behavior, and it is here to stay. Regardless of your product or industry, the shift to more responsible consumer habits needs to be on your radar. While this might not be an easy transition for some brands, it’s important to act now and do what you can — or risk being overtaken by competitors and snubbed by customers. Data from the Latana Sustainability Index shows that 66% of consumers say sustainability is important. This trend is set to continue, as 61% believe sustainability will become even more important after the pandemic. If you can show in your brand messaging that your business is acting in a socially and environmentally sustainable way, this will build trust and encourage customers to stay loyal to your brand. The shift to more responsible consumer behavior has a direct impact on purchasing decisions — with 51% of customers saying they would pay more for sustainable products and 42% buying a specific product over others because it is more socially sustainable. On the flip side, if your brand is found to be acting irresponsibly or unsustainably, this will have a negative impact on your relationship with your customers and is likely to result in lost revenue and market share. of customers say sustainability is important of customers say they would pay more for sustainable products of customers say they would buy a specific product over others because it is more socially sustainable 66% 51% 42% How Would Conscious Consumption Improve Your Relationship With Consumers? Even if you are doing all the right things but your brand messaging doesn’t make this clear, there is a risk that a competitor could encroach on your customers — who are already having doubts. We know this because research shows that the majority of customers are already choosing companies and products based on sustainability factors. To be clear — conscious consumerism is not a niche field or minority movement. These days, the average customer is becoming more mindful of what they buy, which is having a huge business impact. For example, in 1997, organic farming was a niche industry with $3.6 billion in sales. By 2016, organic food sales increased to $43.3 billion, and by 2019 sales reached $50 billion. As more consumers understand the importance of choosing fruit and vegetables free of pesticides that pollute air and water and degrade soil, they are voting with their wallets and choosing to buy organic produce. Some target audiences, such as Millennials and Gen Z, are particularly discerning in their choice of brands and products. So, if you are trying to appeal to a younger audience, people in a high- income bracket, or people with a high level of education — it’s even more important to appeal to those conscious consumers. But, with awareness for sustainability issues increasing across the board, all brands need to be aware of and adapt to this shift. Now that we understand why appealing to conscious consumers is important, let’s explore how your brand can be more responsible and sustainable. $3.6 billion $43.3 billion $50 billion 1997 2016 2019 How to Embrace Conscious Consumption C h a p t e r 2 It might not be easy, but the best place to start is with a long look in the mirror. A realistic self-assessment of how your business operates is the first step to gaining an understanding of how sustainable you are now — and how you can improve in an authentic, genuine way. Here is a quick checklist of questions to ask your brand: You might not be able to answer all of these questions, and some might be more relevant to your brand and industry than others. But, it's important to consider which factors are the most important to your target audience, as consumers are actively researching these kinds of topics before purchasing. So, be honest and think about what you can do to close the gaps. How Can Your Brand Embrace Conscious Consumption? C h a p t e r 2 How low/high is your carbon footprint? Which labor markets does your supply chain rely on? How transparent is your management structure? How fair are your hiring practices and working conditions? How sustainable is your usage of raw materials and natural resources? Who owns your company? What is the company's history like? What are your brand values and how committed are you to them? Are you involved in your local community? Where does your brand stand on social justice issues like Black Lives Matter and #MeToo? What good causes does your brand support and donate to? 1. Understand your target audience A deep understanding of your customers and their mindset is essential. Which social topics are important to them? How do they approach purchasing decisions? How much research do they do? Here, advanced brand tracking software like Latana can help brand managers identify and segment niche audiences to understand the finer nuances of consumer psychology and how different audiences perceive your brand. Tips for Embracing Conscious Consumption Now we know what conscious consumption is and why it’s important for brands, let’s dive into our top tips for becoming a sustainable brand that responsible shoppers love. 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Be transparent, and do what you can Maybe you don’t have millions of dollars to donate to charity, your supply chain needs optimizing, and women are still slightly underrepresented in your senior leadership team. Nobody’s perfect! Change can be a long and challenging process — especially if many stakeholders are involved. Customers understand that, and no one is expecting perfection. Just be honest and set timely, achievable goals to focus on what you can do to get better. Consumers understand that sustainability is not easy, but they expect brands to strive for significant improvement. 3. Audit external partners Even if your brand is doing its best, there may still be issues lurking within the ecosystem of contractors, suppliers, manufacturers, and vendors that work with your brand. If any of these partners are found to be acting unethically, it will reflect badly on you. Evaluate your partnerships regularly, and conduct due diligence on new partners. 4. Review your brand messaging Consumer mindsets have changed in recent years. Therefore, it’s imperative that you ensure your brand messaging reflects consumer priorities. Your website, product landing pages, ads, and campaign content should all answer key questions, such as where your product comes from, where the materials are sourced, and how the product is made. For instance, if the product is made of recycled materials or is manufactured locally, these are key value propositions — so don’t forget to mention them. How Top Brands Use a Conscious Consumption Approach to Marketing C h a p t e r 3 Let’s explore some best-practice examples of brands that have used a conscious consumption approach to a marketing or branding campaign. Then, we’ll provide a few tips for success so you can learn how to use brand association data to get ahead. How Top Brands Use a Conscious Consumption Approach to Marketing C h a p t e r 3 Levi’s c a s e s t u d y “Fast fashion” doesn’t have the best reputation, and many consumers prefer to invest in fewer, higher-quality items that will last a longer time. Levi’s global ad campaign “Buy Better, Wear Longer” emphasizes the quality and longevity of Levi’s clothing. The TV spot kicks off with a statistic, saying, “Global clothing consumption has doubled in the past 15 years. We can change that.” It goes on to explain the benefits of good-quality items, stating: “When we buy better, we can wear longer.” The campaign highlights Levi’s commitment to sustainable production, which includes eco-friendly materials and technologies. Levi’s strives to create quality garments that last a lifetime and respect the planet’s natural resources. The campaign involved a collaboration with six young activists and celebrities from around the globe — including Jaden Smith, Xive Bastida, and Emma Chamberlain. “Levi’s denim is meant to be worn for generations, not seasons. With this campaign we want to encourage consumers to be more aware of their clothing choices,” said Jennifer Sey, president of the brand. Adidas c a s e s t u d y “It’s not easy being green” was the main message of Adidas’ global sustainability campaign to promote new sneakers made of Primegreen, a series of high-performance recycled materials exclusive to Adidas. The ad highlights Adidas' commitment to lower its carbon footprint and eliminate plastic waste — having pledged to use only 100% recycled polyester in all its products by 2024. In the 60-second spot released on TV and social media, the brand teamed up with Kermit the Frog to talk about how overwhelming it feels to be up against a huge challenge like climate change. The loveable character of Muppets’ fame goes on to explain why the seemingly impossible challenge is worth it, saying: “If we all do our part, we can make the world a better place, a greener place, for the next person to walk in our shoes.” The ad concludes with Kermit declaring, “It’s not easy being green.” Stan Smith, the legendary tennis star and ambassador of the Adidas sneaker line, replies, “But nothing great ever is.” Tony's Chocolonely c a s e s t u d y Tony's Chocolonely is a mission-driven chocolate brand determined to shake up the cocoa industry and eliminate slavery. Their brand statement describes them as, “Crazy about chocolate, serious about people” and the boldly colored, unapologetically outspoken brand prompts consumers to think before they enjoy the delicious chocolate. The company is committed to making all chocolate — not just their own product — free of slavery. On its website, the brand explains: “Our vision is 100% slave-free chocolate. Not just our chocolate, but all chocolate worldwide. With incredibly tasty chocolate we lead by example and show the world that chocolate can be made differently: in taste, packaging and the way we do business with cocoa farmers.”