Six strategies to make your future sustainable … and profitable

Imagine a world in which consumers have access to affordable, useful, less wasteful products at scale. Those are the kinds of sustainable products that won’t force consumers to pay a high price premium or a quality penalty, and they include physical goods that last for generations or food that is fundamentally healthier. Meeting the pent-up demand for such sustainable solutions is perhaps the most lucrative innovation challenge of the 21st century.

But the question most companies still need to answer is: how do we do this?

The last few decades have proven that niche solutions and incremental innovations have not yielded the right answers. Those approaches are not making a significant difference to the world’s consumers, who increasingly rank sustainability as a basic purchase criterion on the same level as price, brand, and quality.

It's now time to make plans for radical change with bold moves.

In the first three editions of our newsletter, we built the case for making those plans. In this edition, we offer companies a set of structured and focused ways not only to imagine the radical changes necessary for a future that is both sustainable and profitable, but also to make that future a reality sooner rather than later.

How is your company making radical changes?

As part of our extensive research, we have spoken with several CEOs about how to make radical changes to their business. These leaders are combining a high degree of commercial creativity with an appetite for creative destruction. They know that innovative solutions can quickly tap into the large pent-up demand for sustainable solutions in their markets, but they also realize that their success can render current business models and operating ecosystems obsolete.

The French white goods retailer Fnac Darty has shown that sustainable innovations can emerge from existing capabilities and don’t always require a blank slate. The company is serving the pent-up demand for durability in “durable goods” in several ways. It calculates sustainability scores for different brands and suppliers based on its own data from repairs, maintenance, and installation, and then publishes these scores on its website to help consumers make better selections. The brands and suppliers with the best scores within each category have seen significant volume increases.

The company also launched a service and maintenance program in 2019 to offer repair of domestic and high-tech appliances in order to extend their life span and reduce their environmental impact. Known as Darty Max, the program had 1.1 million subscribers in France as of the end of 2023. In addition to Darty Max, the retailer has its own resale program to extend the useful life of the products it has serviced.

Fnac Darty is pursuing what we call a Longevity Play, which applies an extreme “design to last” philosophy to the physical tools we use every day, from white goods to home electronics. The companies that make and sell these products do not focus on “replace” and “recycle”. The vocabulary of their value proposition for their high-quality products includes words such as refurbish, resell, retain, and repair.

The Longevity Play is one of the six bold strategic plays in the figure below that help companies answer the “how do we do this?” question. We explore each of these plays in greater detail – supported by more stories such as Darty Max – in our forthcoming book, The Demand Revolution: How Consumers Are Redefining Sustainability and Transforming the Future of Business.

The plays are the current starting points for change, but we expect each of them to evolve and new plays to develop. This evolution means that sustainability is becoming a synonym for innovation. Each strategic play caters directly to one or more of the eight consumer archetypes we have defined in our extensive research with consumers.

The Changing Role of the Chief Sustainability Officer

How is your company understanding the ways that consumers are engaging with sustainability and – more importantly – how are you capitalizing on those opportunities? That is where the six plays offer a starting point for building a strategy. Chief sustainability officers (CSOs) can advocate for the adoption of one or more of these plays by moving beyond incremental change and compliance and becoming directly involved strategic planning discussions. That kind of involvement is essential for developing affordable, useful, less wasteful products at scale.

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.