As leading retail brands gather in Barcelona, Havas Media called on retailers to adopt sustainability programs in the same way that they embraced IT 10 years ago.
In an opening presentation at the World Retail Congress this week, Guy Champniss, director of business insights at Havas Media Intelligence, unveiled analysis from Havas Media’s proprietary framework, Sustainable Futures 09.
This first-to-market tool allows brands to analyse, track and monitor their sustainability programs and the subsequent impact on brand value.
Using a cross sector measurement index called the sustainable futures quotient (SFQ) that measures sustainability performance and its contribution to brand value, Havas Media announced a healthy overall picture for the sector.
Furthermore, a number of sustainability attributes assigned to the marketplace, including responsible marketing, fair prices, the sale of healthy products and good customer service, are found to be very important to retail brands. In most cases, the sector is perceived to be a strong performer in this area, resulting in a positive impact on brand value.
When looking into the project in more detail however, weaker results were noted in environmental areas (including sourcing, recycling and packaging), workplace areas (including fair pay, employee and supplier employment) and more broadly in ethics and governance.
Despite significant efforts from many retailers to lead on sustainable store design, operations and suppliers for example, Sustainable Futures 09 demonstrates that these and many other initiatives are not registering with consumers – and are damaging brand value.
“The retail sector already demonstrated its ability to respond when it embraced IT,” said Champniss.
“The way IT was integrated within the sector is an excellent example of the benefits of introducing a horizontal function across the traditionally siloed work flows within businesses. By focusing on the benefits IT could deliver, the retail industry gained new, more productive ways of doing business.
“Approached with a similar mindset, retailers can lead the sustainability process and reap the benefits. Frequency of purchase, price points and deep existing consumer loyalty allows retailers to offer consumers the most accessible step up to more sustainable consumption by quickly cementing behavioural change, and potentially locking in longer-term consumer loyalty.”
The call for a more horizontal and holistic approach to sustainability was also supported by the Sustainable Futures research. When recording the willingness of consumers to endorse and reward brands who adopt sustainable practices, Havas Media found that 80 per cent would reward versus 72 per cent who would punish.
Not only should this act as an incentive for retailers to continue to move forward and differentiate around sustainability, it also shows a more optimistic view on the opportunity available to companies – even in these uncertain economic times.
“Taking a genuine, strategic and horizontal approach to understanding how each business area is best placed to deliver on sustainability – and understanding what the target consumer feels it should deliver – is the route to making sustainability good business,” concludes Champniss.
Responding to the results of the survey, Lucy Neville-Rolfe of Tesco said that motivation and shopper incentives were essential if retailers are to lower their environmental impact.
Citing as an example the way in which plastic bag usage has been halved at Tesco over the past two years, she said that this had been achieved by offering shoppers ‘club card’ points in return for using their own bags. Retailers need to encourage and help customers to change their behaviour, she said.
Urging retailers to be consistent in the message that they deliver to shoppers, Champniss said that “if you’re not consistent, [sustainability] messages have a real potential to backfire".
The report was conducted by Havas Media during the economic down turn in January 2009 and featured over 20,000 consumers in 10 countries.