Profits for Progress? Who Is "The Responsible Consumer", That New and Powerful Figure in Business School Lectures and Trade Negotiations? Someone Who Buys from a Firm That Shows "Corporate Social Responsibility", It Seems

By Hinchberger, Bill | International Trade Forum, January 2004 | Go to article overview

Profits for Progress? Who Is "The Responsible Consumer", That New and Powerful Figure in Business School Lectures and Trade Negotiations? Someone Who Buys from a Firm That Shows "Corporate Social Responsibility", It Seems


Hinchberger, Bill, International Trade Forum


Responsible consumers--those who want organic products, environmentally friendly manufacturing methods and recyclable beverage containers--remain a minuscule minority of buyers, no doubt. But they represent a significant and growing segment of the market. As consumers gain access to more information about business practices, even large companies can suffer if they fail to take heed of these consumers' concerns. The trend, as discussions at the World Economic Forum's Annual Meeting in Davos showed, is expected to gain in momentum and power.

"The field of responsible consumption can be described as manic but minuscule," said Ed Mayo, Chief Executive of the National Consumer Council, United Kingdom (UK). Consumers account for just 1-10% of market share, depending on the segment. But at US$ 23 billion a year, worldwide sales of organic produce, for example, are hardly insignificant.

Neil Kearney, General Secretary of the International Textile, Garment and Leather Workers' Federation in Brussels, Belgium, expressed astonishment that many retailers still argue that the responsible consumer does not exist, that people shop for price and quality only. Look again, he suggested. Informed consumers have rebelled after learning, for example, of substandard labour conditions in overseas factories. Young men in Brooklyn, New York, held a demonstration in front of a Manhattan retail outlet where they threw their sneakers at the entrance in protest at exploitative practices by the maker of athletic shoes. Counterparts in Europe tied the shoelaces together and slung the shoes over telephone wires, turning a whole stretch of road into a performance art piece denouncing bad practices. "Some retailers complain that they're not rewarded for doing good," he said. "But I think consumers punish those who do wrong."

Profile of the responsible consumer

But what do we know about the responsible consumer apart from these concerns? Roberto Milk, Chief Executive Officer (CEO) of the United States-based online global crafts retailer, Novica, reported that in focus groups conducted by his company, the highest correlation is with a demographic segment called "cultural creatives". Author Paul Ray identified cultural creatives in his book of that title, as a group of 50 million people around the globe who are changing the world. Said Milk: "They are the fastest-growing segment. They have above-average education. They are socially conscious. They have high rates of international travel, and they are interested in learning about other cultures."

They also rarely watch television, often preferring radio. In the United States, they tend to listen to the listener-sponsored, non-profit, ad-free National Public Radio. They are avid readers, and tend to be involved in neighbourhood affairs, supporting schools or local environmental groups, for example.

Reaching these consumers requires new marketing and sales approaches. "They don't believe ads," said Milk. "They only believe a trusted source, like a journalist who writes an article. It also can be useful to form a partnership with a larger organization, as Novica did with National Geographic."

Mel Young, President of the UK-based International Network of Street Papers, a 22-country network of newspapers published by the homeless, cited a survey that showed that younger people tend to be more aware of the issues surrounding responsible consumption but that older people are more likely to take action. His analysis: in order to make choices, people need sufficient disposable income; thus when today's young people begin to earn higher salaries, the responsible consumer movement will grow significantly, he predicted.

Linking CSR to the bottom line

If you are a company, can you look to your bottom line to see the benefits from corporate social responsibility (CSR)? Not necessarily, warn the experts. A leading proponent of CSR, Simon Zadek, Chief Executive of the non-profit organization AccountAbility, UK, answered that it pays "maybe, sometimes, usually in asymmetrical ways". …

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