A version of this story happens all the time. There’s a small problem, though. Sometimes consumers don’t have enough information about which companies are doing good in the world —and which companies are doing well through practices that are not so good. But, there’s a layer of hope: Research shows that, given information about companies’ practices, consumers purchase with their hearts, not just with their stomachs. Even, it turns out, if it involves paying a little more to ensure their dollars are not promoting human rights violations.
The 2012 “Goodpurpose” report, a study of 8,000 adults in 16 countries conducted by Edelman, one of the largest PR firms in the world, found that an increasing number of consumers are utilizing their dollars to support companies with consciences. Amazingly, “73% of consumers would switch brands if a different brand of similar quality supported a good cause, a 9% increase since 2009.” That’s nearly three quarters! Likewise, the 2012Cone Communications Social Return Trend Tracker, a survey of 1,000 adults in the U.S. conducted in August 2012 found that: “86 percent of consumers are more likely to trust a company that reports its CSR results; 82 percent say they are more likely to purchase a product that clearly demonstrates the results of the company’s CSR initiatives than one that does not; and 40 percent say they will not purchase a company’s products or services if CSR results are not communicated.”
Now, let’s be realistic. Prices play a big part in consumers’ decisions (especially given the current economic crunch). So the question becomes: Are consumers willing to pay a little extra to make the world better? Happily, the answer is “Yes!” In a 2005 study published in the Journal of Consumer Affairs, hundreds of people in Belgium were asked about their willingness to pay extra for fair trade coffee. The survey found that the “average price premium that the consumers were willing to pay for a fair-trade label was 10%.”
If consumers are willing to pay a little extra, why do many of them forget to do so? Again, the problem is one of misinformation or lack of information about which companies are promoting human rights and which are not. The average consumer only knows how to distinguish between chocolate or coffee based on price. We need greater information about where these products come from so we can factor that in, along with price.
Despite these odds—the lack of information and the sluggish economy--conscious consumption is on the rise. In March 2012, the Nielsen Company published a report on the “global, socially-conscious consumer.” Based on a survey of 28,000 online respondents from 56 countries, the report found that, “Fifty-one percent of all respondents aged 15 to 39 are willing to pay extra for such products and services.” In other words, younger consumers under 40 are more likely to spend a little extra for products they know come from “socially-responsible companies.” These Gen-Y consumers AKA Millennial shoppers favor companies that align with their values.
But anyone and everyone can be a conscious consumer. Even if we don’t fully realize it, we consumers have a lot of power. When we decide to buy one brand over another, the ripple effect can be global. Today, there are a few groups who carry enormous potential to bring about this change because of their purchasing power. Take women, for instance. According to a release by Cynopsis Media, based on a WE tv and Nielsen survey, “75% to 85% of consumer purchases are driven by women.” Imagine if every single woman decided to buy a particular chocolate brand based on companies’ track record in human and environmental rights. African Americans are also a powerful, and growing, consumer group. A report by Nielsen and the National Newspaper Publishers Association called The State of the African-American Consumer found that African Americans will soon reach $1 trillion in buying power: “If African-Americans were a country, they’d be the 16th largest country in the world.”
So, back to the supermarket. When you reach for that chocolate (or any other product!), think about how it binds you to everyone else on the planet who helped produce it and ask how you are voting with your wallet. Stay tuned here for info on how to be sure you’re voting for practices that are ethical and fair.