How to impress the new ‘conscious consumer’

How To | Retail

By Christophe Pecoraro, Managing Director at PFS Europe

Locking down the world for months was bound to leave a lasting legacy on society. One of the most positive outcomes is the increased awareness of our impact on the environment. Carbon emissions fell drastically, the water in Venice ran clear and wild animals began to roam in locked-down cities. Consumers have also emerged from the lockdown more conscious of the impact that their personal shopping habits are having on the environment and are changing their purchasing behaviours as a result.

A new report from PFS and LiveArea, Selling Sustainability: Adapting to the New Conscious Consumer’, found that during lockdown consumers had the opportunity to reflect and re-evaluate their shopping habits. As a result, consumer attention has now been turned to the sustainability of their purchases and the environmental impact associated with their shopping habits. In fact, 37% of UK and Irish shoppers have said that they are more conscious of the effect on the environment now than before the pandemic.

This newfound “conscious consumer” is set to change the retail landscape for good and brands must not only be ready to cater to evolving consumer needs, but also have the opportunity to act first and take the lead in change. We’re already seeing major brands responding to conscious consumer demands, with The North Face announcing in August it’s going to take on Patagonia by increasing its sustainability and environmental efforts.

Nearly three-quarters (73%) of consumers said they are now expecting online retailers and brands to use recyclable packaging or minimise their use of packaging. Brands that ignore these early warnings are setting themselves up for failure, as sustainability and acting ethically can improve customer loyalty and lifetime value. Small changes, such as right-size packaging, ensures not only effective and more secure packing of a product, but also results in more packages being able to fit on a truck. This requires relatively low investment given the anticipated return and demonstrates that not all sustainability solutions come at a cost.

The new sustainable landscape

Adjusting to the new landscape may be difficult at first, but, if brands want to provide an improved customer experience then it’s an issue that must be tackled sooner rather than later. Being transparent and open about products will help brands to maintain healthy communication with their consumers and stay ahead of competitors. Consumers are now paying significantly more attention to the processes that retailers go through prior to delivery. Despite this, only 37% of consumers said they are satisfied with the communication from online retailers or brands on the environmental impact of the products they have bought.

Throughout the purchasing process, where and how products are sourced is also being evaluated by conscious consumers. Over a third, (35%) stated that when they make a purchase the product must be naturally, locally or sustainably sourced, while 56% of respondents said they prefer to buy products that can be delivered within their own country. This also contributes to the theory of consumers being more socially conscious about supporting local, independent businesses, rather than multinational corporations.

Communication is key to ensuring that this new sustainable landscape is maintained. One of the issues with communication is that consumers aren’t aware of what actually happens during the returns process. The research found that 42% of consumers believe that the products they return are reused or recycled, with only one in five aware that goods are often thrown away or destroyed.  In reality, 5 billion pounds of waste is generated through returns each year. This emphasises a clear need for change. If online retailers and brands communicated that returns go to landfill, 71% of consumers said they would change their online shopping habits.

Maintaining positive changes

The positive changes that have been accelerated by COVID-19 are here to stay. Consumers are now actively seeking online retailers and brands who stand by their sustainability credentials. Although the situation was forced upon consumers due to factors outside of their control, it clearly served as a wakeup call for both individuals and brands alike. Our research shows that 72% of consumers plan to continue with their changed shopping habits following the pandemic, while 40% of consumers feel that online retailers and brands should continue with reduced carbon footprint initiatives which include changes to product delivery and sourcing. This highlights how crucial it is for businesses to pay attention to this new consumer, as they have more choice than ever before.

The end of bulk returns?

Though many people, especially Generation Z and millennials, have admitted to over-purchasing and returning items in the past, these altered consumer habits will likely put an end to this. In fact, 37% of all shoppers said they have stopped over-purchasing as a result of the pandemic. In August, ASOS revealed that its customers are now making more ‘deliberate purchases’ and sending back fewer items, which has had a positive financial impact on the retailer.

Primark has also introduced a nationwide recycling programme in order to prevent unwanted clothing ending up in landfill. Programmes such as this will be essential in building relationships with the new conscious consumer and encourage them to spend money with the brand.

A hopeful future

Whilst a more sustainable retail industry can only be a positive, there are certain things brands can do to help ensure they stay ahead of the consumer while positively impacting customer experience, brand loyalty and the bottom line. They must work quickly to understand the needs and desires of their customers throughout the buying journey and identify how they can cater to these heightened sustainability expectations. Authenticity cannot be underrated as shoppers see straight through empty words and gestures. Action and effective communication is key. Brands that meet the needs of the conscious consumer and consider what, where and how their products are sourced, will be in the best possible position to thrive.

It’s been a rocky year for the retail industry, on a backdrop of continued uncertainty for the high street, while online channels outperform expectations. We’re now at an important but exciting crossroad, where the brands and retailers that consider their impact on the planet will reap the rewards and those that show disregard will be punished by shoppers, waving their wallets elsewhere. Acting ethically is now not only the right thing to do, but the most profitable thing to do for long term growth. Those that genuinely care about the environment and successfully communicate this with consumers, however, will be the ones with the brightest future.

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