BfG News Issue 13 - Editor's Column: The value equation with sustainability built-in

13 Jun 2008|Added Value

Fiona_polaroid(1)Today’s financial uncertainty is creating a tension between sustainability and value as consumers are challenged to make uncomfortable trade-offs. We believe brands have a role to play in helping consumers by appreciating their desire to make the “right” sustainable choices coupled with getting the best value price.

Therefore, as marketers, we should focus anew on the value equation. By showing a deep understanding of consumer’s motivations to offer better sustainable product choices, brands can gain competitive leadership and boost brand loyalty. To achieve this, marketers need to take into account the following:

Understanding the consumer context, or “Cultural Capital”
Consumers don’t live in a vacuum, their consumption & behaviour is affected by what is going on around them. Along with the credit crunch, house prices are predicted to fall by 9% this year, the cost of food basics escalating by up to 20%, all leading to an uneasy sense of insecurity for many. Simultaneously, sustainability issues are being brought to the fore as global food shortages are being blamed on a multitude of causes: climate change, biofuels and the escalating price of oil.

As a result, we are seeing signs of changing behaviour as consumers come to terms with their options; by simply consuming less, demanding more for less or even making new and different choices altogether. Figures from the Horticultural Trades Association show a 31% increase in the sales of vegetable seed vs a corresponding 32% decline in the sale of flower seeds confirming the trend to ‘grow your own food’. Whilst this behaviour is unlikely to be mainstream it shows how brands need to respond to changing consumer demand.

Redefining value to in corporate sustainability
The term ‘good value’ has become culturally understood as ‘cheap’ or ‘low cost’, thanks to our inherent need to get the best bargain. In fact, the meaning is really about a relative understanding of what you pay for vs. what you actually get in return. From research* we conducted, we know that a brand’s responsible behaviour is increasingly seen as a driver of value. Indeed, sustainability issues can act as a benefit, but also by their absence, can constitute a detractor from value.

Reframing what is valuable about your product or brand offers a new way to talk about value, and becomes especially pertinent in the context of sustainability.

  • A healthier diet leads to less sickness avoiding expensive medical bills
  • Locally sourced produce reduces pollution from transport, supports local businesses and is more convenient 
  • Better quality fashion is more durable than “disposable” options that can rely on cheap labour, so less waste, savings in the long run and of course a timeless look
  • Energy saving appliances reduce carbon emissions and also create savings on energy bills
  • Transparent practices are a form of insurance against danger or corruption and sense of security about the brand choice.
  • Virtual working, communicating and  shopping reduces carbon emissions & packaging, but also saves both time and money
  • Protection of diversity allows us to preserve the spaces that we need to relax and commune with nature.

Bridging the gap between sustainability and value
There is evidence of brands stepping up to the challenge of integrating sustainability into their value proposition. The key is to make this fit comfortably with the brand DNA so it feels seamless and relevant, rather than at odds with the familiar brand promise. Premium beauty brand, Aveda is claiming to be the first beauty company to manufacture with 100% wind power, integrating this message into their value proposition with the launch of their ‘Smooth Infusion’ range.

Creating value with sustainability by drawing on the product benefits to detract from the higher price tag is a much harder task in the price driven retail sector. Supermarket giant Wal-Mart has firmly aligned sustainability to its value proposition of giving customers the best price with their tagline “Save money. Live better” supported by regular product offers which “Save money. Save energy. Save the environment”. Sainsbury’s are living up to their “Try something new today” tagline with affordable recipes that will feed the family for a fiver, but could have taken this a step further by incorporating sustainability. 

Just as challenging is the energy sector; overcoming a negative environmental impact whilst remaining competitive. E.ON have successfully integrated the value and sustainability message into their proposition by helping consumers to ‘See the energy you use’, bringing this invisible resource to life in their advertising.

By redefining the value equation to include sustainability in a way that fits with the core proposition of the brand and builds its equity, will undoubtedly place brands in a stronger position in today’s difficult trading climate.

Fiona Davies-Baker
Associate Director, Qualitative Insight
Added Value UK

* Branding for Good CSR Barometer 2008

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