Data is key for successful businesses to take decisive action on sustainability

Consumer demographics insight helps brands to thrive by understanding how embedding sustainability in their policies, practices and products will influence consumer attitudes and behaviours.

In a world with an awakening environmental conscience, consumers want to know more about provenance. Company reputations will increasingly rest on ethical practices – from sourcing raw materials, reducing carbon footprint and embracing climate change agendas to employment rights and diversity and inclusion (D&I) practices. This is about the end-to-end story of how products and services are produced and brought to market. It goes beyond what goods are made of or packaged in, or how far they’ve travelled.

Sustainability is a revenue issue

Customers vote with their feet when they see organisations acting callously or making too little effort in sustainability. In most markets, they have other options if they don’t like one brand or retailer’s approach. That makes sustainability an issue for competitiveness and commercial performance as well as a matter of corporate conscience.

82% of UK consumers feel strongly about buying products that are ethically and sustainably sourced – it has started to matter to 24% only in the last year

53% of UK consumers would never buy from a brand again if it was accused of working with unethical suppliers

41% of UK consumers make a conscious effort to buy locally sourced or produced items online

Opentext consumer survey, 2021

Sustainability is mainstream for UK consumers

We often pin the sustainability ‘trend’ on the younger generation of consumers, spearheaded by Greta Thunberg and other prominent activists and celebs. But Gen Z is just one group in a cross-generational population that’s increasingly mindful of sustainability. It’s a mainstream issue on global political agendas and in traditional and online media, both reflecting and increasing levels of concern throughout society.

Consumer action on sustainability matters in B2B just as much as in consumer purchasing, because the present and upcoming decisionmakers and stakeholders in corporates are people too. They bring their own ethics and value judgements to work with them, reflecting the concerns of their peer groups and of a wider world.

Many local and independent businesses have lately experienced an upswing, despite the constraints of the Covid pandemic. Our consumer data provides clear evidence that the many UK consumers constrained to an existence closer to home are now choosing local suppliers for goods that they might once have purchased in cities or during their work commute. There’s a feel-good factor in shopping local, on top of the sustainability benefit from both goods and customers travelling fewer miles and the positive impact of helping local employers thrive and provide fairly-paid employment in their communities.

Will consumers put their money where their mouth is?

Of course, there’s a financial tipping point in sustainable choices for many people. Customers say they want to purchase greener products and services – but how much are they prepared to pay? More sustainable sourcing, production and employment are often more expensive. And commercial organisations need to remain viable and profitable if they’re to thrive, grow and embed sustainable approaches to lead the market.

To make decisions about meaningful changes in policy and practice, businesses need more granular information about what consumers want and at what cost. It’s the only way they can be sure that doing the right thing is affordable and viable in the longer term.

Local micro-business owners tend to interact with their customers directly. It’s easy for loyal shoppers to give community businesses feedback face-to-face about what they’re doing well or badly, and how important sustainability is to them. For larger organisations with many customers and many channels of engagement, including branches or outlets and online stores, it can be harder to gauge what’s driving success… or driving customers away. Most consumers simply take their custom elsewhere if they’re unsatisfied with a brand’s approach or prices – very few raise their concerns first.

34% of consumers actively choose brands that have environmentally sustainable practices/values

28% of consumers have stopped purchasing certain brands because they had ethical or sustainability related concerns about them

7% of consumers have contacted a brand to raise an issue on their sustainability or ethical practices and values

Deloitte survey into consumer attitudes to environmental and sustainability issues, 2021

Consumer insight allows confident decision-making for sustainability

Consumer data is vital to help organisations understand changing patterns of consumption and to plan outlets and distribution accordingly. It can help them understand how to prioritise and communicate their sustainability policies and actions with impact and integrity. It can inform product development and marketing campaigns, helping to reduce waste in both production and budgets. Crucially, it provides evidence to support investment in sustainability-driven initiatives, helping to predict potential revenues in evolving markets.

Organisations need to review this consumer data and trends regularly, particularly within their existing catchments and among target customer segments. Carrying out customer surveys and providing easy routes to give feedback can provide valuable information about existing customer priorities. But what about prevalent and emerging attitudes among prospective customers or in potential new segments and markets? Is there a difference? Are competitor approaches finding greater favour?

Customers, employees and investors are scrutinising your sustainability

There’s no question that businesses of every size need to take heed of customers’ growing attention to sustainability, in the UK and beyond. It’s already becoming a key success factor in customer recruitment and retention, for brand reputation, in attracting investment and for employee recruitment and retention.

The gold standard is granular data that connects attitudes to sustainability with the behaviour and choices of real consumers across channels and geographic areas.

To support this agenda CACI have developed an ESG score to drill into each aspect of how important environmental, social and governance issues are to individuals, enabling companies to assess both their current and potential customer base and act accordingly.

This takes the form of a series of individual level propensity models based on market research questions about consumers attitudes towards the following:

• Environmental factors such as climate change and pollution
• Social matters around community and social concerns and human capital
• Governance issues around workplace practices such as executive pay and ethics

The product contains three propensities, one for each of the individual aspects of ESG and one unified score to summarise an individual’s affiliation to all the values encompassed by ESG. These probabilities relate to how important each of these aspects are and can be provided at individual level coded or aggregated up to postcode level.

Based on this data, leading businesses can produce consistent and reliable customer insight, using the latest analytics and modelling, to help them prioritise and accelerate their sustainability programmes.

If you’d like access to market-leading insight and evidence about consumer attitudes and responses to sustainability issues, talk to the consumer data experts at CACI.

Want to read more from our ESG blog series?

• Climate risk disclosure is just the beginning
• Technology helps reduce waste for consumers and businesses
• Driving smoothly into the consumer EV market
• Responsible and sustainable practices

Discover more about CACI’s ESG Score and the consumer insight it can provide your organisation in our product sheet: