Good news everyone: we fixed consumerism! (Kind of.) The ethical shopper now evaluates brands on their commitment to sustainability. Before she asks, “Do you have my size in blue,” she researches the company’s commitment to a circular-based-economy and its strategic plans for carbon neutrality. (Apparently.)
A report by NYU Stern’s Center for Sustainable Business has the receipts. Using barcode scan data, the researchers found that 50% of CPG growth from 2013 to 2018 came from sustainability-marketed products. And in more than 90% of categories, sustainability-marketed products grew faster than conventional products.
If reports like these are your eco-dream come true, I’ve got the wake up call in the form of attitudinal studies. According to an article from the Harvard Business Review, while 65% of survey respondents say they want to buy purpose-driven brands that advocate sustainability, only 26% actually do.
The statistic reflects a broader problem for sustainability brands identified by Henry Stott et al. in their study “Green New Deals: Social Boasting and the True Value of Ethical Branding.” They found that people, across all demographics, tend to overstate behaviors they think fit with social norms. Specifically, “social boasting” is highest when it comes to recycling, travel behaviour and avoiding products with palm oil.
But their second finding is the one brands should really mull on: “Consumers are not moved to purchase a brand’s ethical product by virtue of it having an ethical image; instead, how much they like a brand and consider it affordable are much stronger purchase drivers. Consequently, not only do consumers behave less ethically than they claim to, they also do not generally care whether a company is actually ethical or not.”
The (Green) Brand Playbook
The trouble with statistics like those from NYU Stern is that they reduce complex systems of human behavior to easily digestible numbers, usually in service of a narrative. They’re not wrong, but they give an incomplete picture of eco-conscious consumerism. And that can lead to flawed brand strategies.
To the point: “doing good for the planet” is not the foundation of a relevant brand strategy. It’s an undifferentiated claim that speaks more to an emergent market trend than a startup’s unique contribution to it.
Nevertheless, sustainability startups have largely followed the same playbook for over a decade. Frame the environmental problem as dire and imminent (it is), offer a compelling solution (they do), call the activists to arms (we buy at dawn).
It’s important to note that while well positioned startups are singularly focused, consumers are not. The virtues valued by the former simply aren’t as important as quality, convenience, cost, and brand preference among the latter.
If sustainability startups want to change the world, they’ll have to consider brand strategies beyond utopian storytelling or doomsday prognostication. Appeals to “save the planet” will only resonate with consumers who are committed to a well funded, ethically superior lifestyle.
Now, as much as I enjoy the view from my own high horse — striking down brand purpose masquerading as strategy — I do think there’s value in championing environmental impact as part of a broader brand narrative.
Nassim Taleb writes in his book, Skin in the Game, that all it takes is a “small number of intolerant virtuous people” to change the system. It’s easier for a passive majority to acquiesce to the unwavering demands of a small (intolerant) group in the absence of a compelling reason not too.
He explains it like this: “The Kosher population represents less than three tenths of a percent of the residents of the United States. Yet, it appears that almost all drinks are Kosher. Why? Simply because going full Kosher allows the producer, grocer, restaurant, to not have to distinguish between Kosher and nonkosher for liquids, with special markers, separate aisles, separate inventories, [and] different stocking sub-facilities.”
Replace Kosher with “eco-conscious” and drinks with “products” and you have a compelling argument for appealing to consumers who report making purchase decisions based on a brand’s commitment to sustainability.
According to Taleb, even a resolute three-to-four percent of a population can force the whole population to submit to its preferences. Again, conventional consumers can buy sustainable products, but the intransigent minority of eco-zealots can not (morally speaking).
If the tipping point is nearing, if we’re so close to redefining what’s acceptable in the mainstream, then why not continue the successful approach of designing brand identities around a mission to “save the planet”? Answer: diminishing returns.
Leading with sustainability actually undermines the broader impact sustainability startups can make. It slows growth (both of the business and its mission). Instead, brand strategies that go beyond the table stakes can appeal to consumers who lack the bandwidth to factor their environmental impact into every transaction.
That’s why it’s critical for sustainability startups to ignore the planet for just a moment and ask, “Who is the consumer and what do they want?” The answer will invariably raise the stakes and create a meaningful differentiation in a crowded market. And to be clear, it doesn’t negate the commitment to sustainability. Those virtues don’t disappear when they aren’t at the forefront of brand identity.
Take for example Sonos Motors, a European automotive startup with a vehicle that recharges in the sun “thanks to more than 248 solar cells seamlessly integrated into the body.” It’s an innovative product, a concept so compelling it feels obvious in retrospect. And rather than touting a commitment to the environment, it touts a commitment to the driver with slick design cues, keyless ignition, app integration, excellent daily driving range, as well as an innovative vehicle and energy sharing model. No proselytizing about eco-ethics until the consumer is already invested in the practical and reputational attributes of a car that’s actually cool to own.
And it’s not just the automotive sector. Impossible doesn’t sell its commitment to climate change. It sells plant-based products that are somehow meatier than meat. SUAVS brands its sustainable footwear as the go-to for leisure and travel, not recycled water bottles for your feet. And Flow isn’t just about its 100% recyclable, plant-based packaging. It’s mostly about the contents: alkaline water for fun, health, beauty, and flavor. Sure, all the sustainability claims are there, but they’re second order benefits that are correctly positioned as antes, not raises.
Startups have always challenged the status quo. They take a conventional category and carve out a slice ripe for improvement. But as more and more conventional firms incorporate sustainability into their business models and brand strategies, sustainability will become the new status quo. It’s a win for Earth, but a threat for startups unprepared to design their brands beyond a commitment to saving the plant. Maybe just make great products that are eco positive, instead of selling eco-positivity. Then people will like you because you’re great, but love you because you’re good.