Conscious Consumers Are Changing BBMG Conscious

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Conscious Consumers Are Changingthe Rules of Marketing. Are You Ready?Highlights from the BBMG Conscious Consumer ReportRaphael Bemporad and Mitch BaranowskiOVERVIEWGreen. Sustainable. Fair trade. Locally grown. Socially responsible.We know the words, but what do they really mean to America’s familiesand consumers? With conscious consumers representing an increasingmarket opportunity in the United States, is being green truly poised to gomainstream? How can socially responsible business leaders build authenticbrands for a more sustainable future?As a growing number of brands aspire to the same values, socially mindedbusiness leaders and marketers face the new challenge of distinguishingtheir companies, products and services in an increasingly crowded greenmarketplace.In the first major study to combine field observations with a national surveyon purchasing behavior and social values, increasingly conscious consumersare demanding that companies be transparent about their practices andaccountable for their impact on people and the planet.According to the inaugural BBMG Conscious Consumer Report, nearly ninein ten Americans say the words “conscious consumer” describe them welland are more likely to buy from companies that manufacture energy efficientproducts (90%), promote health and safety benefits (88%), support fair laborand trade practices (87%) and commit to environmentally-friendly practices(87%), if products are of equal quality and price.“Many companies arehonestly looking to engagein sustainable businesspractices and become moresocially responsible,” saysRaphael Bemporad, foundingpartner of BBMG. “But ina world of green clutter,conscious consumers expectcompanies to do more thanmake eco-friendly claims. Theydemand transparency andaccountability across everylevel of business practice.”Conducted by branding and marketing agency BBMG, in conjunction withresearch partners Global Strategy Group and Bagatto, the report combinesethnographic research in three U.S. markets with a national survey of 2,007adults to reveal how companies can reach, inspire and motivate today’ssavvy and values-driven consumers.Highlights from the BBMG Conscious Consumer ReportNovember 2007

FIVE VALUES DRIVE CONSCIOUS CONSUMERSFrom the ethnography — which observed the behaviors, experiencesand values behind 24 consumers’ purchasing decisions in Lawrence,KS; Long Island, NY; and Livermore, CA — researchers first learned whythese Americans are thinking more about the social and environmentalimpact of their purchases on the world in which they live. Specifically, afteranalyzing 1,000 photographs and 150 hours of direct observations, theethnographers discovered five core values driving the nation’s more sociallyminded consumers:Health and Safety. Conscious consumers seek natural, organic andunmodified products that meet their essential health and nutrition needs.They avoid chemicals or pesticides that can harm their health or the planet.They are looking for standards and safeguards to ensure the quality of theproducts they consume.HEALTH AND SAFETYHONESTYCONVENIENCERELATIONSHIPSDOING GOODThe five core values driving the nation’ssocially-minded consumers.Honesty. Conscious consumers insist that companies reliably and accuratelydetail product features and benefits. They will reward companies that arehonest about processes and practices, authentic about products andaccountable for their impact on the environment and larger society. Makingunsubstantiated green claims or over promising benefits risks breedingcynicism and distrust.Convenience. Faced with increasing constraints on their time and householdbudgets, conscious consumers are practical about purchasing decisions,balancing price with needs and desires and demanding quality. Theseconsumers want to do what’s easy, what’s essential for getting by and makedecisions that fit their lifestyles and budget.Relationships. Who made it? Where does it come from? Am I getting backwhat I put into it? These consumers want more meaningful relationships withthe brands in their lives. They seek out opportunities to support the localeconomy when given the chance, want to know the source of the productsthey buy and desire more personal interactions when doing business.Doing Good. Finally, conscious consumers are concerned about the worldand want to do their part to make it a better place. From seeking outenvironmentally-friendly products to rewarding companies’ fair trade and laborpractices, they are making purchasing choices that can help others. Theseconsumers want to make a difference, and they want brands to do the same.“I really feel good about going to thefarmers market. There’s somethinggreat about connecting with thisother person who’s responsible forgrowing your food.”Lisa and Alex, married, 30s, California“While consumers continue to prioritize personal and practical concerns likehealth, safety, price and quality, they are also looking to make a differencein the world,” said David Lubensky, founder of Bagatto, a San Franciscobased ethnographic research firm. “We see a trend toward ‘self-centeredconsciousness,’ whereby consumers want companies to meet their personalneeds and positively impact society.”Highlights from the BBMG Conscious Consumer ReportNovember 2007

MARKETING TO A NATION OF INCREASINGLYCONSCIOUS CONSUMERSTo discover what segment of the larger U.S. population shares these values,the research team then surveyed 2,007 adults nationwide between Sept.11 and 17, 2007. The key findings shed new light on how companies canmore effectively navigate the market opportunity of reaching and involvingconsumers who care more and more about corporate social responsibility:The most important issues are the most personal. The most pressingissues by far are those that most directly affect consumers – safe drinkingwater (90%), clean air (86%) and cures for diseases like cancer, AIDS andAlzheimer’s (84%). By comparison, only 63% of those surveyed described themore abstract issue of global warming as the most or a very important issue.A conscious boom. The language and labels of the “conscious consumer”have penetrated the marketplace and become part of the consumerculture. Americans readily self-identify as “conscious consumers” (88%well, 37% very well), “socially responsible” (88% well, 39% very well) and“environmentally-friendly” (86% well, 34% very well). There is less tractionwith the term “green” (65% well, 18% very well), which continues to beviewed as more exclusive and harder to achieve.Making more informed decisions. Consumers are looking beyond the buzzto make more informed decisions about the products they buy and thecompanies they support. To understand if a company “does good thingsfor people and the planet,” most use magazines and newspapers (53%),certification seals and labels on products (52%), the Internet (41%) andadvertisements (30%). Friends and family members (24%) are certainlyinfluential, but do not appear to be the primary source of information forpurchasing decisions.Moving beyond convenience. Consumers have moved beyond justconvenience when shopping for various products. While price (58% veryimportant) and quality (66% very important) are paramount, convenience(34% very important) has been edged out by more socially relevantattributes: where a product is made (44% very important), how energyefficient it is (41% very important) and its health benefits (36% veryimportant) are all integral to consumers’ purchasing decisions.Rewards for social responsibility. When given a choice between productsof equal quality and price, consumers are more likely to buy from a companythat manufactures energy efficient appliances and products (90%), promotesconsumer health and safety benefits (88%), supports fair labor and tradepractices (87%), commits to environmentally-friendly practices (87%) andmanufactures its products in the United States (86%).“Americans think before theybuy. Our poll reveals thatmany consumers evaluatethe social and environmentalimpact of their purchaseson the world in which theylive. They tend to prefer tobuy from companies thatreflect their values and areincreasingly likely to buy fromcompanies that demonstratethey are good for peopleand the planet,” said JefreyPollock, president of GlobalStrategy Group.“In my ideal world, everything in myfridge would be organic. To me, it justmakes the whole earth a better place.”Mark, single male, 40, New YorkIs it easier being green? Consumers willingly engage in “easy” behaviors,such as recycling cans, bottles and newspapers (55% always) and usingenergy efficient appliances (46% always), but they often fail to adopt aplethora of more “demanding” behaviors like carpooling (10% always), usingpublic transportation (9% always) or purchasing carbon offsets (3% always).Highlights from the BBMG Conscious Consumer ReportNovember 2007

A NEW PRISM: CONSUMER PROFILES FROMINDIFFERENT TO ENLIGHTENEDFinally, a segmentation analysis of the poll findings reveals four profilesof U.S. consumers representing a broad range of attitudes and behaviors,including Enlighteneds (10% of consumers), Aspirationals (20%), Practicals(30%) and Indifferents (40%).Enlightened consumers are the most driven by their values when makingpurchasing decisions and will go out of their way to reward companies whoalign with their social goals. Aspirationals are more likely to balance theirideals with convenience and often switch between social concerns, availabilityand price when making purchasing decisions. Practicals are looking forconvenience and prioritize products based on price, quality and energyefficiency. Indifferents are the least motivated by social concerns and prioritizeprice, quality, convenience and products manufactured in the United States.INSIGHTS FOR MARKETERSIn the end, three lessons for marketers and business leaders emerge fromour research into the conscious consumer:Trust matters. At a time of extreme clutter (messages, labels, products),conscious consumers are prizing transparency, accountability and authenticitymore than ever. They are looking for deeper, more meaningful relationships– a chance to participate in brands and be empowered by them. Companieswho align their values with their actions will earn enduring loyalty amongconscious consumers.Self-centered consciousness. While conscious consumers care deeplyabout the world around them, they prioritize issues that affect them directly.Companies offering products and services that deliver quality, affordability andsustainability will do better with conscious consumers than those that do not.It’s a journey. Small steps can make a big difference, both at multinationalcompanies and with conscious consumers. Global businesses understandthe market opportunity presented by sustainability, and they recognize theyhave much more to do. Individuals, even the most enlightened, are also on ajourney. Indeed, during the same trip to the grocery store, consumers make avariety of choices that balance health, price, convenience and social benefit.Smart marketers will meet conscious consumers where they are. Theywill help companies back their eco-friendly promises with sincere sociallyresponsible actions. They will empower consumers to become brandambassadors. They will share knowledge across communications platforms,and increasingly, they will see marketing’s power to enable deeper, moremeaningful and mutually beneficial relationships.Indifferents: 40%Enlighteneds: 10%Aspirationals: 20%Practicals: 30%Enlighteneds, the most consciousconsumers, represent 10% of theU.S. population.“At a time when consumershave more options thanever, what companies bringto market is less importantthan how they bring theirproducts and services intothe marketplace,” says MitchBaranowski, founding partnerat BBMG. “By aligning theirvalues with their actions,companies can close the trustgap with conscious consumersand reap the rewards ofdeeper relationships, enduringloyalty and a growing triplebottom line.”Marketing’s next frontier will move beyond transactions to embraceconnections and collaboration, as trust, transparency and purpose becomethe new currency of corporate reputation.Raphael Bemporad and Mitch Baranowski co-founded BBMG in January 2003.Highlights from the BBMG Conscious Consumer ReportNovember 2007

AT-A-GLANCE:AMERICA’S INCREASINGLY CONSCIOUS CONSUMERSTop Issues:Most Important Product Attributes:Research Methodology:BBMG designed the consciousconsumer study in August 2007.Bagatto, Inc. performed theethnographic study, which includedextensive observations andinterviews with 24 consumers inthree markets: Lawrence, KS; LongIsland, NY; and Livermore, CA.The ethnography focused on singlemales, single females, marriedcouples with no children, marriedcouples with children and emptynesters. A national online surveyof 2,007 adults was conducted byGlobal Strategy Group from Sept.11-17, 2007. The margin of error is /- 2.2 percentage points.Self Identification: (% rated as “very well”)Desired Company Practices:Most Responsible Companies:Highlights from the BBMG Conscious Consumer ReportNovember 2007

ABOUT BBMGWith offices in New York and San Francisco, BBMG is a branding andintegrated marketing agency dedicated to helping values-driven organizationsharness the laws of branding to stand out, build relationships, win loyaltyand inspire action. Recent clients include CNN, Luna Bar, Bill & MelindaGates Foundation, Harvard University’s JFK School of Government, Library ofCongress, and UNICEF, among others. www.bbmg.comABOUT GLOBAL STRATEGY GROUPGlobal Strategy Group is a leading strategic research firm specializing inidentifying the underlying factors that impact consumer and voter attitudesand behavior. Global Strategy Group believes that all marketing andcommunications strategies should be based on an in-depth understanding ofthe target constituency, and they devise real-time decision roadmaps to helpcorporations, associations, governments and political candidates realizetheir goals. www.globalstrategygroup.comABOUT BAGATTOBagatto is a Customer Insights Consultancy specializing in customer focusedbusiness, product, and service design research and strategy. www.bagatto.netTo order the complete BBMG Conscious Consumer Report, visit www.bbmg.com.Highlights from the BBMG Conscious Consumer ReportNovember 2007

Companies offering products and services that deliver quality, affordability and sustainability will do better with conscious consumers than those that do not. It’s a journey. Small steps can make a big difference, both at mult

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