Hacking the minds of sustainable consumers

Consumers act much differently when they want to make a sustainable purchase. If you understand and act on these differences, you not only earn short-term revenue from your sustainable goods and services, but also earn something far more valuable: the long-term loyalty of consumers and the lifetime value it unlocks.

The objective of this edition of the newsletter is to help you look beyond immediate profits and take a more holistic long-term view of your relationship with consumers. To unlock that substantial lifetime value, you need to hack the minds of consumers along the traditional purchasing journey. And as with most of the insights in our newsletters, the recommendations on how to accomplish that derive from the best source: consumers themselves. They told us what companies need to do to finally serve their pent-up demand for sustainable solutions.

How to win and keep loyal sustainable consumers

The first insight from consumers is that you don’t need to reinvent every wheel in your go-to-market strategy. What you need to do is get much better at executing the journey in the figure below, in line with the fundamentally different ways that consumers think about sustainability.

That’s essentially the same journey you will recognize from Marketing 101. The difference is that the familiar wheels of a typical consumer purchasing journey spin at different speeds when consumers seek sustainable solutions. Once companies figure out how to hack this journey and make it work, they can attract the right consumers, serve them well, and earn their loyalty. The engine that powers this loyalty lies in the three middle steps that we highlight in the figure: evaluation, purchase decision, and user experience.

Evaluation: You can expect that your target consumers – regardless of which archetype they belong to – will do extensive homework before they make their purchasing decisions. Motivated by previous waves of greenwashing, bad experiences, or simply an abundance of caution, your potential consumers will dig up third-party evaluations, sift through posts on social media, and talk to their friends, colleagues, and family in an effort to get as much credible information as they can. If they find compelling arguments, otherwise loyal consumers are willing give up long-term allegiances to their brands of choice and go instead with the brand or company that (finally!) fulfills their wants and needs for a sustainable solution.

To help consumers do this homework, you can shift marketing spend away from glossy ad campaigns and towards more native marketing and influencer spending. You create numerous lucrative opportunities when you:

• Own the sustainable brand leadership in your category: Many consumers told us that they can’t research every product they buy or else that wouldn’t have time for anything else in their lives. ?They need credible and trustworthy guidance. A powerful brand eases the research burden for consumers by serving as a trusted shorthand. The more you can reduce that burden, the greater your chances of winning a loyal consumer. This is a vast opportunity because few categories have a clear brand leader for sustainability.
• Broaden the definition of sustainability: Consumers don’t seek sustainable solutions solely to save the environment. They seek sustainable solutions to save time, money, space, effort, risk, and in some cases, as a way to live a healthier lifestyle. That’s why they use many proxies for sustainability, such as superior quality, durability, and longevity. Focus on consumers, not the planet.
• Stop making grandiose claims: Success starts with credible and noticeable benefits for consumers. Their resistance increases whenever they sense that a company is putting a green sheen on an inferior product or making promises that they seem unlikely to ever fulfill.

Purchase decision: Sustainability has joined traditional purchase criteria—price, quality, and brand—as a fundamental driver behind purchase decisions. It is no longer a fringe or niche factor that influences only a small number of passionate consumers.

The strength of sustainability’s influence within that mix, however, varies by consumer archetype and by product category. That influence is robust for the Champions, Thoughtfuls, and Planet Savers across all categories. The variation by category is wider for the Cost Conscious and the Image Driven, and the importance of sustainability is marginal in some categories for the Selectives and Skeptics.

This variation has implications for your go-to-market strategies – and especially your pricing strategies – for sustainable solutions.

• Don’t default to a premium price strategy: The fatal disconnect that underpins the green mirage is that sustainable solutions must have a price premium, and if consumers don’t pay it, it means they aren’t interested in sustainability. What companies overlook is that there is a full spectrum of viable pricing strategies – from premium to low price – that can help them make their less wasteful solutions more profitable and more attractive to consumers. Profit ultimately comes down to three variables – price, volume, and cost – and for too long companies have focused on price and cost rather than focusing on volume.
• Make it easier for consumers to buy: Affordability is only one issue with sustainable solutions. Consumers often forgo buying them because they can’t find them, don’t trust them, or don’t know how to service them if they have questions. Thorough and trustworthy communication about access, usage, service – in addition to credible communication about benefits – can help consumers act on their intentions to buy a sustainable solution.

User Experience: As Hermann Simon writes in his book Confessions of the Pricing Man, a customer stays loyal “only if the exchanges with the seller cultivate a lasting sense of fairness. Customer satisfaction is the only way to maximize long-term profits.”

The user experience is the third cylinder in the engine that drives the loyalty of sustainable consumers. That’s why it is inexplicable for us that companies often hit consumers with a “quality penalty” with their sustainable solutions: to make something “green”, they often end up making it worse.

When the consumers we spoke with find a brand they like, buy it, and have a positive experience with it, they tend to change their behavior in two ways. First, they repeat their purchase without repeating their research. Second, many of them give back by posting about their experiences to make the research tasks easier for others.

In short: win them once, and you probably win them for good, not only for that category, but for other solutions you offer.

The special role of the user experience means that you have opportunities to:

• Build an attractive ecosystem for your consumers: A continuous and trusted relationship with consumers can foster a strong degree of loyalty and advocacy. Consumers can transfer that positive experience to other solutions you offer as they learn to trust you and your brand. This not only creates opportunities for upselling and cross-selling, but may also alter price–value perceptions to such an extent that the loyal consumer may be willing to pay a premium for their next experience and buy your brand more frequently. Ongoing communication helps consumers keep their user experience in context, recall it favorably, and enhance it.
• Support advocacy efforts: Our research showed that loyal sustainable consumers are more willing to serve as brand advocates. They give back in many ways, such as leaving “digital bread crumbs” on social media, to help other potential consumers expedite their research. This form of advocacy comes across as stronger and more genuine, because consumers are advocating their personal choices and not merely a brand.

By understanding and capitalizing on the differences in the sustainable consumer journey, you can turn your target consumers from confused doubters into your strongest and most loyal advocates across the lifecycle of your sustainable solutions and across their lifetime as consumers.

Please click here to pre-order your copy of The Demand Revolution: How Consumers Are Redefining Sustainability and Transforming the Future of Business. The book is scheduled for publication by MIT Press on October 8.