Time for companies to act responsibly as consumers take note
Avon, Mary Kay and Estée Lauder got caught up in a storm over ‘cruelty-free’ claims made despite undertaking animal testing in China, whilst lead levels in lipstick were also put under the microscope; two examples of how a company can have its image damaged.
According to a new report from market research firm Nielsen, half of consumers under 40 years of age are willing to pay extra for products and services from socially-responsible companies.
Sixty three percent of global, socially-conscious consumers under age 40, consult social media when making purchase decisions and are most concerned about environmental, educational and hunger causes, according to the new study.
“It’s clear that corporate social responsibility efforts resonate with a specific group of consumers,” said Nic Covey, vice president of Nielsen Cares, Nielsen’s global corporate social responsibility program.
“Marketers need to know who those consumers are in order to maximize the social and business return of their cause marketing efforts. This understanding allows brands to engage in social impact efforts that appeal to the right consumers with the right causes and through the right channels.”
Causes and answers
Socially-conscious respondents prioritize environmental sustainability (66 percent), improvements to science, technology, engineering and math education (56 percent) and the eradication of extreme poverty and hunger (53 percent) for companies implementing programs.
“Knowing what causes are most important to the socially-conscious consumer may help brands prioritize their social investments,” said Covey. “The next step is to understand precisely what causes are important to a brand’s individual customers.”
According to Nielsen’s survey, when it comes to brands and advertising, global, socially-conscious consumers trust recommendations from people they know and look for opinions and information posted by other consumers online (76 percent).
“In order for cause marketing efforts to affect sales, customers must first be aware of a company’s efforts,” said Covey. “Nielsen’s information indicates that social media is a critical tool for effective cause marketing.”
Who and where?
Nielsen’s survey shows that overall, younger consumers are more willing to spend extra for products and services from socially-responsible companies.
Consumers in Asia Pacific, the Middle East and Africa and Latin America were found to be more willing to pay extra for products and services from socially-responsible companies than consumers in North America and Europe.
According to Nielsen’s survey, the highest concentration of socially-conscious consumers is in the Philippines, where 68 percent of respondents are willing to pay extra for products, while the lowest concentration is in the Netherlands, where 21 percent of respondents indicated a willingness to spend more.