Customer perception

Customer perception of value – the most prominent market trend of the decade

As popularly outlined, the meaning of sustainability focuses on the ability of us humans to meet the needs of the present without compromising the ability of future generations to meet their needs, and this can be relatable across three pillars – economic, social, and environmental, informally known as profit, people and planet. This is a cause that has been mostly championed by business enterprises across various sectors and inclusive of all sizes. Prominent amongst them are the Energy, Manufacturing & Agriculture sectors.  

Investors and shareholders, who are the proverbial backbone of businesses’; ensuring that there is business continuity through the injection of capital and helping with business developments, are usually wary of committing to the sustainability course firstly, because It seldom shows a clear path to profitability in the short term, and secondly, it involves companies being transparent with their earning results and that leaves a worry for them.  

On the other side of the coin are the consumers, even though they are the last puzzle in the supply chain and the most vital of all stakeholders because they are the very reason any business venture exists, they are largely the most affected and the least catered for in regards to the outcomes of business activities; some of the effects caused by the business as usual’ status quo includes the inability to make affordable products and services for those on low incomes (the sachet economy), poorly packaged products have been found to be harmful to the consumers’ health as well as causing pollution in their immediate environments, unsustainable and harmful chemicals and raw materials used in the manufacturing of certain products have also proven to be directly detrimental to the consumers’ health.  

Today, consumers around the world are mobilizing and are beginning to demand sustainable products as they make a shift from value-driven products to purpose-driven products. In August 2020, Accenture reported that 60% of people are spending more on sustainable products than before the pandemic hit. Other statistics showed that nearly 6 in 10 consumers surveyed are willing to change their shopping habits to reduce environmental impact. Nearly 8 in 10 respondents indicate sustainability is important for them. And for those who say it is very/extremely important, over 70 percent would pay a premium of 35 percent, on average, for brands that are sustainable and environmentally responsible. 

But meeting consumers’ demands isn’t exactly linear either, there are several reasons why producers and suppliers are developing cold feet towards adopting sustainably-motivated practices and standards; the challenges of inventing an entirely new manufacturing process, instead of making tweaks to an off-the-shelf product, are threefold: it requires Time, Money and Patience, three resources that are in short supply for fledgling businesses.  

Time- The amount of time spent on sourcing for sustainable raw materials, testing its proficiencies in labs is usually enormous, thus slowing down business activities. 

Money- Oftentimes, it takes a ridiculously vast amount of money to deploy R&Ds as well as develop prototypes. Hence, the rigorous process of a capital raise. 

Patience- Creating a sustainable product isn’t a “one-way street”, it often involves lots of tweaks, iterations….and worse scenario – dead-ends such as non-scalability.  

As a result of this daunting circumstance that producers and suppliers encounter while transitioning to a sustainable path, it has inadvertently created room for lop-sidedness in production or operations, thus leaving an honest question in the minds of consumers- “are they as good as their planet-unfriendly counterparts at getting the job done?”. A 2020 survey from the University of East Anglia found that many consumers see sustainable messaging as being synonymous with “compromise”, and they assume products marketed in this way won’t work as well as those that don’t mention their eco-friendly qualities- Greenwashing 

Hitherto, beyond whether the product is of good quality and safe, consumers are raising the bar by demanding more transparency and information generally about how the products they purchased were produced and sourced. They want to know:  

– Who produced it (and were the people treated properly e.g did they receive a fair wage)?  

– How was the product produced and what was the impact on the environment? 

Consumers, regardless of their gender, ethnicity, or age groups- Boomers to Gen Zs, are recognizing that some of the strongest anchors point to demanding holistic change, responsibility, and accountability of producers and suppliers are through Traceability which involves tracking sustainable products from the suppliers down to the retailers, and Visibility which refers to amplifying actors across the supply chain e.g raw material producers, processing company, manufacturer, etc.  

This initiative will prove to be beneficial to every stakeholder in the supply chain as it strives to achieve inter-connected objectives such as; 

-Product safety and quality 

-Better risk management 

-Better informed management decisions 

-Tracking of commitments to consumers 

-Improvement in reporting such as GRI  

-Brand enhancement 

Ultimately, consumers need to realize that they are the absolute policymakers and they possess the wherewithal to influence government policies, multinationals corporations, and international organizations towards improving life expectancy through producing goods sustainably while making the planet Green.  

……………………………………………………………………………………………………………………………………………………………………………………………………

 About the Author

Benjamin Udokwu- Climatr

Benjamin Udokwu is the Managing Partner for Social Sustainability at Climatr.

He is an avid reader and researcher. He has keen interests in the African retail economy- formal and informal alike. He has extensive practical skills in systems engineering, business development, strategy and operations, corporate sustainability, and design thinking.

Favorite quote: “Knowledge is knowing the right answer, Wisdom is asking the right questions”.

Leave a Comment

Your email address will not be published. Required fields are marked *

Open chat
1
Hello! how may i serve you?
Hello👋,
How can we help you?