Part One – Embracing Ethics – A New Customer Driven Standard
Executives everywhere are recognizing the benefits of developing a strong Corporate Social Responsibility (CSR) strategy. At the same time, we see our customers changing as well – they grow continually more hyper-connected, priorities shift, and attention spans get ever-shorter in an increasingly crowded digital marketplace. Today’s customers are a generationally diverse bunch, and their focus is more and more being led by a higher mix of generation Z buyers who are now asking businesses to combine more sustainable, ethical practices with long-range strategic goals.
As we all know, the true benefits of any solid CSR strategy must be built into the very fabric of a company’s corporate vision – ensuring better working conditions, adopting more efficient production and delivery modes, supporting underserved communities and using more environmentally friendly materials – but doing so can also be an effective way to encourage customer participation in a company’s brand story.
We have seen many high profile examples – most notably in the oil industry – shine a light on how lack of environmental awareness can have a devastating impact on customer perception. Others, such as FedEx’s donation of its fleet services to assist in disaster relief and international organ transport, highlight the potential to be found in using a corporation’s reach to benefit the common good. When companies show the public they are listening, both sides benefit.
The beauty of a well-designed CSR strategy is that it offers a positive result in three distinctly important areas. CSR has the power to:
- Enhance the customer experience
- Benefit the environment on a global scale
- Significantly impact a company’s bottom line
In an earlier blog, I discussed the ways in which social media have given customers an added power over the retail experience, forcing companies to incorporate their interests and demands into the creation of brand stories if they wish to establish trust and promote loyalty. But today’s consumers want to add another chapter to these stories. It is no longer just the availability of information – and how it is packaged – that matters. As we discovered in a recent Dell global CSR research project, customers have begun to take note of a business’ overall accountability as well:
- Across EMEA countries >75% of customers view CSR as important
- Across EMEA countries 60% of customers are more likely to purchase from a brand associated with CSR initiatives
- Exposure to CSR initiatives increases purchase intent + 13% – + 22%
From the customer’s point-of-view, the global benefits of a solid CSR plan are obvious. But to effectively understand how CSR initiatives influence the overall buyer journey, we must first ask ourselves what the customer stands to gain from a psychological stand point.
Clearly, today’s consumers feel a new sense of empowerment, and they are eager to flex their economic muscles. Their online reach has extended from simple product reviews to include not just the goods a company offers, but the practices and materials that go into their production, and they are now serving as a virtual ethical police force who feel not just a desire, but a duty to keep companies in check along every step of the product journey.
These same social media platforms that have tipped the scales in favor of customers now stand as a platform for watchdogs intent on upholding a standard of global honesty and accountability. When a company’s actions are not in line with its words, the online response is immediate, and often calls the integrity of both brand and message into question. Today’s consumers are watching, and will stand for nothing less than model behavior.
Looking Within – Strong CSR Policies Begin at Home
With today’s hyper-connected eyes on the lookout for any potential corporate misdeeds, companies need to put honest thought into their long-range CSR plans. The days of paying lip-service, or “greenwashing” a company’s image, are thankfully a thing of the past.
One smart way to do this involves looking to internal stakeholders and employees for guidance. When management takes an active role in CSR initiatives, the focus is sharper and the reach longer. Not only does this personalize a company’s strategy from within, it also allows employee experience to highlight what is most important to the company itself and ensure that the strategic CSR goals are in fact possible. This enables workers to feel personally vested in the outcome, while ensuring that the effort is genuine at the core, making for a more resonant public message. After all, according to Forbes Magazine, 83% of employees would seriously consider quitting if their employer engaged in unethical practices. We must not forget that employees are customers, too, and their firsthand enthusiasm is often contagious.
In just a few short years we have seen the power exchange come full circle, and when a company attempts to align their corporate practices with the opinions of its loyal buying public, it allows customers the chance to have a positive ethical impact on the entire process. Such an impact resonates not only across the globe in terms of sustainability, but also in the minds of customers, in terms of trust.