This is yet another brilliant article from the gifted industry journalist Tara Donaldson and the timing is perfect. I write you this from San Pedro Sula, Honduras at the end of 2 exhausting days of meetings with dozens of people as we near the Nov 27-29 summit conference here.
Our keynote speaker is Simon Mainwaring who’s global message is about ‘purpose driven branding’. The purpose of our summit is to reveal the new capacity for activewear yarns and fabrics being built here. The purpose of the project itself, of the investment of hundreds of millions of dollars, is jobs, security, safety and sustainability. What better purpose is there than that, to which Tara alludes in the following article.
As for the summit itself, we clearly have reached capacity on rooms and venues and will be cutting off registration today.
Brands That Don’t Stand For Something Will Take a Hit to the Bottom Line, Study Finds
sourcingjournalonline.com, Oct 29, 2018, By Tara Donaldson
Today, consumers want brands that believe in something, and those that don’t, risk sacrificing everything—and least where customer loyalty is concerned.
“Now more than ever there’s a really strong commercial imperative to share what your brand means,” Andrew Wilson, executive director of purpose for marketing consultancy Edelman, said speaking at the Textile Exchange Textile Sustainability conference in Milan. And, he added, “Business is expected to take an initiative on leading change.”
Regardless of which side of the fence you’re on with Nike’s ad supporting the controversial Colin Kaepernick, an NFL quarterback that’s been shut out of play over his decision to kneel during the national anthem in protest of racial injustice—the athletic brand’s position has so far proven good for business, despite rampant protests and consumer promises to never purchase Nike again.
“Online sales went up 30 percent a week after the ad ran and share prices have never been higher,” Wilson said. “Consumers have said ‘yes, that’s the kind of thing we want to see companies do, so we’re going to support you with our purchase, our dollars.’”
In its Earned Brand survey launched earlier this month, Edelman found that consumers expect businesses to take initiative on change, and 64 percent say CEOs should lead that change rather than waiting for government to step in.
“Business is way ahead of government in terms of being trusted by society,” Wilson said, which points to a major opportunity for brands to step in intelligently and stand for something. Forty-six percent of those surveyed in the study think brands have better ideas for solving the world’s problems than the governing powers that be. “You can do more through the power of your brand, through the power of your products and services than governments.”
Nearly two in three customers today are “belief-driven buyers,” meaning they would either actively choose to purchase from a brand that takes a stand on issues, or they would actively avoid it, Wilson explained.
Belief-driven buying has gone mainstream around the world, particularly among the millennial and Gen Z cohorts, many of whom have taken strong positions on societal issues and will align with brands and retailer that show support of those same positions. But this consumer evolution isn’t limited to the youth.
“This cuts across all markets, cuts across all ages and…cuts across all income groups,” Wilson said. “Welcome to the new brand democracy.”
Consumers have already put their stock in brands to lead the charge on social change, with 54 percent
The ball is now in brands’ court, and a turnover at this stage could mean consumers start looking elsewhere for leaders—and elsewhere to spend their disposable income.
“People are voting with their wallets,” Wilson said. In terms of driving purchase intent, consumers are as equally swayed by a brand’s stand on social and environmental issues than product features.
Just 26 percent of consumers express intent to advocate for a brand after viewing a product or brand communication, while 32 percent would do so after learning of a brand’s stand on an issue. And though product drives purchase intent for 44 percent of consumers, a brand’s stand on something drives purchase intent for 43 percent. It’s a nominal 1 percent difference that points to the opportunity for brands to invest more time an energy in support of social issues rather than solely focusing on product.
“You have the solution to the social and environmental issues for change,” Wilson told an audience of sustainability leaders from all of the major brands in the apparel industry. “Belief-driven buying is now a mainstream mindset across ages and incomes.”