Playbook launched to help marketers embrace circular economy as a competitive advantage

Consumers want a circular economy. The idea of products and services that avoid waste or pollution, and regenerate nature, is a ‘no brainer’ in its relevance for our increasingly volatile world. Repeated research studies show that consumers welcome ways to use their spending power to positively impact climate change and biodiversity.

The challenge lies in also delivering the level of functionality, convenience and price point comparable to the traditional alternatives. But evidence is now demonstrating that this is possible, especially when marketing teams work in collaboration with their colleagues in procurement and production to come up with a positioning that proves irresistible to buyers. In many cases a circular strategy delivers a more satisfying, more durable, product and is therefore a significant commercial opportunity.

How to unlock this potential? A new playbook has just been published, aiming to inspire and upskill marketers to respond to consumers’ desire to keep products and materials in circulation and produce them in ways that enrich the natural world. It is packed with examples of brands integrating circularity into their marketing strategies in order to strengthen customer loyalty and boost revenues

The document was created from a collaboration between Kantar and the Ellen MacArthur Foundation, bringing insights from over 50 marketing professionals at the forefront of the circular economy transition. Four action pathways are introduced;

• Create scalable circular solutions
• Drive demand for circular propositions
• Make circular behaviours irresistible
• Hardwire circular KPIs

Scale is key to make circular business models like reuse, refurbishment or resale commercially viable and the playbook addresses ways marketers can move from pilots towards fuller adoption. It also explores the process of altering consumer attitudes and behaviour so that they are motivated to do things like return packaging and repair and resell items.

Show me the margins

Circular economy represents untapped value potential for many businesses.The Cambridge Institute of Sustainability Leadership has just published a report making a case for ‘moving beyond the ESG hype bubble’ towards more systemic change, including a call for stronger policy mandates and businesses to ‘compete aggressively on superior sustainability performance’.?

Progressive brands are realising that circular economy is the means by which that necessary competitive advantage can be achieved. Consider Back Market. Over the past year millions of people across the world decided against buying yet another brand new phone complete with scarce critical metals, and instead bought a refurbished Back Market device. The brand is now worth USD 5.7 billion.?

Or there’s Vinted. Millions regularly snap up bargains from its second-hand clothes listings, collectively earning the brand EUR 596 million in revenues. Why buy a new product that has consumed fossil fuels in its production when you can save an existing item from landfill that costs you a fraction of a new version?

These are just two of the thriving brands built entirely around circular business models, keeping products or materials circulating within the economy at their highest value. Companies are also integrating a circular approach into their current operations – like UK grocery retailer Ocado, which recently reported a 29% uplift in sales of large, refillable plastic bottles of pasta versus its traditional single-use versions. Consumers clearly didn’t need much convincing to store the empty containers and hand them back to the delivery driver to be cleaned and reused.

That little doorstep scene illustrates the brand loyalty value of a circular economy. Rather than a one-off transaction, a circular approach often involves a much longer brand-consumer relationship, rich with potential for marketers. As marketer Nicole Rigas observes in the marketing playbook for a circular economy; “In a linear economy, the marketer’s main goal is to get the product sold and there’s a world of opportunity after the point of sale that is often ignored”.

Profit or planet doesn’t have to be a binary choice. Circular economy is the strategy that can bind both goals together, and marketers hold the key to unlocking this brand value potential.?