MARKETINGOPPORTUNITIES
Table of Contents
Introduction 2
Ethical Consumerism 3
Figure 1. Ethical Consumerism Growth Trend, 2006-2011. 4
Figure 2. Ethical Consumerism Growth Trend within the UK markets. 5
Facets of Ethical Consumerism 5
Social issues and consumption 5
Ethical consumer behaviour 6
Social belonging 6
Figure 3. Ethical Consumer Purchasing Behaviour Trends. 8
Identity and Ethical Consumerism 8
Existing marketing opportunities and increasing ethical consumerism 10
Figure 4. The 2010 Ethical Consumerism Report by the Cooperative Bank. 11
Conclusion 12
Bibliography 14
Introduction
Sustainablemarketing is a concept that has seen progressive incorporation intothe strategic goals of many profit oriented organisations for thepast twenty years (Armstrong et al. 2012, p.289 Newholm and Shaw2007). Sustainable marketing appertains to the attempts by firms toimplement environmentally and socially accountable business processes(Harrison, Newholm and Shaw 2009). Such processes are aimed atappealing to the current needs of targeted consumers as well as abusiness as it seeks to ensure it remains in operation as a goingconcern. Presently, government agencies, consumer advocates, and manyother like-minded critics are challenging marketers for unfairtreatment against consumers (Newholm and Shaw 2007). These entitiescite deceptive practices, high prices, unsafe products, high-pressureselling, poor service, and planned obsolescence as putting theconsumers at a disadvantage. Organisations have lately chosen ethicalconsumerism over environmentalism because of the high costsassociated with the environmentalism approach. Thus, it is imperativeto provide an analysis that identifies the various facets of ethicalconsumerism and the potential opportunities the movement accords tomarketers.
EthicalConsumerism
Froma historical point of view, consumption was influenced by attempts tosatisfy material needs while for some quota of human society, toparade wealth (Newholm and Shaw 2007). However, this has changed inthe contemporary world as more people employ choices definingconsumption to support various causes and issues. Ethical consumerismis in essence not a novel approach, but it has had the impact ofenabling consumers influence change via adopted purchasing habits. Infact, Figure 1 shows the growth of ethical consumerism, which showsthat it, continues to grow at an average rate of 8%.
Figure1.Ethical Consumerism Growth Trend, 2006-2011. (Sourced fromhttp://ethicologist.com/ethical-consumerism-still-increasing-despite-the-economic-downturn/)
Itis critical to point out that the term ‘ethical’ remainssubjective for both the organisations as well as for the consumer(Harrison et al. 2009). However, firms and consumers embrace the factthat ethical consumerism involves the production or buying of thoseproducts that are intent on minimising or limiting the prevalence ofsocial and environmental degradation (Harrison et al. 2009). On thesome note, it involves the staying away from those productsconsidered by firms and consumers as being detrimental to the societyas well as the environment. Figure 2 shows the development of ethicalconsumerism in the UK from 1999 to 2012, which points to aprogressive development.
Figure2.Ethical Consumerism Growth Trend within the UK markets. (Sourced fromhttp://developmentupdates.blogspot.co.ke/2015/03/ethica-consumerism-introduction.html)Facetsof Ethical ConsumerismSocialissues and consumption
Ethicalconsumers associate a direct connection between prevailing socialissues and consumption and as such, perceive that they possess theability to employ their purchasing decisions towards a just society(Chatzidakis, Pauline and Bradshaw 2012). The ethical consumer notonly exhibits high expectations and demands from the inherent valueof products purchased but also demands the same in the delivery ofsuch value through ethical processes and techniques (Vittell 2003).For the consumer to make purchasing decisions in an ethical manner,he or she must understand various notions associated with suchbehaviour (Chatzidakis et al. 2012). The social environment is afacet that influences the prevalence of ethical consumerismbehaviours (Belk, Timothy and Giana 2005). For instance, if aconsumer relocates from a region with low considerations as to whatthey consumer to a region where consumers are adept to what theypurchase, then some form of purchasing behaviour transformation isobserved. It is, therefore, common to find out that most consumerswho engage in ethical consumerism reside in large cities (Vittell2003). In large cities, sources of novel information concerning howsome production processes or systems tend to affect others insociety, ecosystems, animal welfare, and so on is bountiful (Belk etal. 2005). On the same note, within metropolitan areas, there arenumerous firms producing similar but differentiated products,therefore, greater choice. In rural areas, the same information maybe available but only to a limited cross-section of the populace(Vittell 2003). The outcome is that consumers in the rural areas havea limited choice of some of the products they are in a position topurchase.
Ethicalconsumer behaviour
Ethicalconsumers also manifest a marked degree of ethical consumer behaviour(Zanna, James and Russell 1980). Some consumers keen on environmentalconservation and preservation will often opt to vouch for productsand services from firms that have a proven record of accomplishmentof ethical practices (Auger and Devinney 2007). This attribute isalso referred to as positive ethical purchasing behaviour(Tallontire,Rentsendorj and Blowfield 2001).For instance, financial services offered by the UK banking sectortend to transcend both legal and illegal markets. A financialinstitution like the Co-operative Bank in the UK has for the lastdecade sought to ensure that issues shunned by the ethical consumerare positively considered. This is done such that such that vettingis done on all clients prior to availing financial services (Vittell2003). Issues such as greenwashing affect ethical consumerism (Zannaet al. 1980). Greenwashing arises from the instance where firmspurport to offer ethically produced and processed products on thepackaging while the actual product, production techniques, and evenmarketing processes do not conform to the set industry standards(Auger and Devinney 2007). The Ethical consumer will often shun beingassociated with such products, which translates to boycottingunethically processed goods.
Socialbelonging
Socialbelonging is considered as a core facet of ethical consumerism (Augerand Devinney 2007). The consideration has occurred especially thecase in social institutions such as in workplaces and higher learninginstitutions. It is common to find that students residing together incampuses tend to bond into cohesive units. Such cohesive units mayopt for social behaviours like food sharing to minimize wastages(Auger and Devinney 2007). Conversely, such social behavioursconcerning purchasing decisions could compel group members to opt topurchase less. The result these social behaviours is close socialbonding among members with the same notion concerning consumerism andhow it affects their health, finances, environment, and longevity.Another outcome is the deep and positive feeling of being allied toindividuals with similar sets of values and vision on a given socialissue. This has enabled the Co-operative Bank, for example, torealign its policies and organisational strategies to capture thediverse expectations of the ethical consumer. It is critical to pointout that ethical markets are in essence quite erratic such that, thefacets of ethical consumerism become overly complex for anyindividual firm to incorporate all (Auger and Devinney 2007).Progressive firms have opted to focus on a specific ethicalinitiative whether charitable, labour-related or environmentalissues. Thus, organisations opt to align their brand with aparticular ethical standard concept in an attempt to reach out to agiven consumer group (Solomon et al. 2010). Such may be associatedwith such aspects as gender concerning labour relations, age,education levels, political orientation, income, local activism,social concerns, and utilitarian aspects.
Figure3.Ethical Consumer Purchasing Behaviour Trends. (Sourced fromhttps://www.ipsos-mori.com/researchpublications/researcharchive/1496/Ethical-Consumerism-Research.aspx)Identityand Ethical Consumerism
Therehas been a marked rise in the attention society accords to theethical consumerism movement (Solomon et al. 2010). This has beenfavoured by greater awareness of society concerning ecological,environmental and human costs attributed to consumerism. As such, theaccessibility and popularity of ethically produced products, as wellas services, has been on the rise (Auger and Devinney 2007). Themedia has had a very significant role to play in this aspect whilestrong retail store operators have played an important role inensuring the constant availability brands considers as highlyethical. Globalisation has played a huge role in consolidating thecurrent consumer society leading to a situation where consumption hasbecome a form of social, individual and market identity (Auger andDevinney 2007). For instance, in a globally interconnectedmarketplace, consumers in different regions often consumers servicesand goods produced in distant countries. As such, the supply chaincomplexities have remained to be very limited from the consumers’point of view (Auger and Devinney 2007). This implies that ethicalconsumerism is a movement that has evolved to ensure the contemporaryconsumer is in a position to become involved in these processes.
Identityis embraced as a multi-dimensional phenomenon giving rise to theuniqueness of an individual with personal as well as socialdimensions (Szmigin, Marylyn and Morven 2009). This implies thatpeople will often describe identity as leading subjects in individuallives as well as objects as perceived by others. An individual’slifestyle serves to represent a given set of positional indicatorsand by extension, define affiliation to a particular social group(Szmigin et al. 2009). Lifestyle, therefore, establishes variationsamong different groups through cultural and more so, consumer goods(Szmigin et al. 2009). The identity concept relative toconsumption-based societies implies that the development of self is,in essence, a reflective process where people tend to monitorconstantly past actions and seek to modify future behaviours asprescribed by on-going experiences (Solomon et al. 2010).Participating in specific consumer practices allows individuals toexhibit social facets of individual identities that can be describedthrough three avenues (Solomon et al. 2010). Consumption isinherently a social activity involving some degree of cooperationwith other people. Furthermore, it avails excellent opportunities forthe satisfaction of human needs towards greater social interaction.Consumerism allows for the experimentation and consumption of thecore meaning of identity because people attach significance andmeanings to specific activities or products. Lastly, consumptionallows for the satisfaction of individual needs necessary for socialinteraction. That is the knowledge of what and how to consume offerscritical guidance towards a given social status and by extension,membership in a given consumer grouping.
Reflexivityis a critical element associated with identity and serves to explainspecific individual actions (Shaw, Shiu and Clarke 2000). Reflexivityenables a person to become conscious of his or her consequentialengagements as a consumer. Concerning societies, reflexivity is acircumstance of the various risk associated with modernization.Conversely, modern societies being risk societies translate tosituations where the development of individualization occur (Shaw etal. 2000). In this case, individuals become agents of theirlivelihood as mediated by a given market. Intensifiedindividualization results in a situation where a person becomes moreresponsible towards decision-making processes that influence theirbiographies that became self-reflexive.
Modernityoffers individuals the opportunity to implement self-reflexiveproduction whereby consumption essentially becomes the tool foridentity creation (Shaw et al. 2000). This has resulted in thesituation where markets are now critically considering ethicalconsumption as it relates to debates concerning globalisation,nature, individualization and reflexivity (Armstrong et al. 2012).The globalisation process has consolidated the consumer society aswell as the process of consumption, which is inclusive of ethicalconsumption as a means of identification. Ethical consumerism hasresulted in a situation where reflexive capabilities bring aboutsocial transformation, which implies that reflexivity also developsbecause of societal transformations, structures, and communication(Armstrong et al. 2012). Ethical consumerism has within the contextof globalisation lead to greater social interconnectedness (Armstronget al. 2012). The purchasing behaviour of different individuals,therefore, serves to reflect the linkages between their everydaydecisions as well as the global outcomes of such outcomes. Forinstance, Fair Trade market has continued to adapt to challengesarising from the concept of ethical consumerism as involvedmultinational organisations continue to place greater emphasis onconsumer motivations and consumer patterns.
Existingmarketing opportunities and increasing ethical consumerism
Inthe recent past, there have been damaging media reports on largemultinational organisations processing high-quality products incountries with weak legislation and enforcement protocols, thusallowing for the use of child labour (Nicholls and Lee 2006). Theresult has been widespread incidences of backlash among consumersocieties keen on ethical production standards. Consumers loyal tosuch brands expressed anger and out rightly shunned purchasing allproducts associated with these brands (Armstrong et al. 2012). Thisimplies that ethical consumerism is growing especially in establishedmarkets like the UK, where consumers opt for the premium brand butquickly disregard them upon knowledge of unethical practices.Marketers in organisations should thus, take the onus of taking theopportunity to effect marketing strategies that are deeply rooted inthe ethical consumerism movement.
TheCo-operative Bank of the UK is an example of one company that hasinvested heavily in ethical consumerism research and established thatover 30% of consumers are greatly concerned with the manner in whichorganisations operate (Armstrong et al. 2012). Given that ethicalconsumers transcend social and political boundaries. It is,therefore, imperative that multinational as well as other smaller butprogressive organisations work towards taking up opportunitiesarising in the advent of greater ethical consumerism all over theglobe.
Figure4.The 2010 Ethical Consumerism Report by the Cooperative Bank. (Sourcedfrom http://www.brandanomics.com/methodology)
Asshown in Figure 4 Firms in the UK can proactively embrace facets ofthe ethical consumerism movement towards ensuring it abides byethical values embraced by consumers while at the same time ensuringthey offer value to their buyers. The result would be greaterconsumer loyalty and increasing behavioural intentions (Zanna et al.1980). By aligning an organisational strategy with a particularethical issue that appeals to a wide cross-section of consumers cantranslate to successful marketing campaigns that will create a robustbrand citizenship.
Organisationculture has to be appropriately transformed to conform to the callsvoiced by the ethical consumer. The ethical consumer is keen oncaring for the environment and prefers to purchase products fromcompanies that exhibit positive environmental conservationattributes. Similarly, firms known to exercise gender parity in HRinitiatives also tend to gain positively from such ethical practices.Given that many ethical consumers align themselves with social groupsthat call for quality as well as a commitment to ascribed ethicalstandards, then such firms tend to appeal to consumer groupings withabove-average disposable incomes (Zanna et al. 1980). More so, suchconsumers will obviously communicate products from such organisationsto other group members, which implies that such organisations willrealize greater profitability, greater brand loyalty, and loweroperating costs. As such, ethical advertising and marketing is agreat opportunity for organisations to conform to the facets of theethical consumerism market and reap significant gains from suchinitiatives.
Conclusion
Regardlessof the industry or geography in which a firm operates, the decisionto exercise greater adherence to socially acceptable ethicalprinciples can only project positive outcomes to firms. If a businessopts to reach for quick profits at the expense of such ethical, thereis always the possibility of a potentially crippling brand backlash.With the growing numbers of ethical consumers in a globalisedsociety, firms ought to examine how overall business processes alignto the evolving ethical anticipations of consumers. This involvespositively responding to the ethical consumerism developments toremain profitable in economies that are on the plateau stage of thebusiness cycle.
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