More than ever, consumers are attentive to the social impact of the products they purchase. This presents retailers with an opportunity to enhance their brand and earn trust, but only if their efforts are thorough, well-designed and sincere. Ahead of their keynote appearance at Retail’s BIG Show this January, Lars Petersson, president at IKEA U.S., and Christopher Gavigan, co-founder and chief purpose officer at The Honest Company, share lessons on building a purpose-driven brand and engaging socially conscious consumers.
Check out the official recap for photos, videos, articles, presentations and more from Retail’s BIG Show 2017 .
Authenticity: only through consistency
Customers who are passionate about social issues demand that companies reflect their values in meaningful, authentic ways. Yet, a brand can’t become authentic through a single marketing campaign or PR effort. Instead, the experts agree that authenticity is the result of regular, repeated actions, over a sustained period of time, which demonstrate a company’s commitment to its core vision and purpose.
“For a brand to be authentic, they must have strong values — but even more important, they must make consistent decisions based on those values,” says Lars Petersson, president at IKEA U.S. Christopher Gavigan, co-founder of The Honest Company — an eco-friendly, ethical consumer goods company — agrees with this approach: “A brand is ‘authentic’ when it loudly and openly articulates its unique point of view (point of difference) and values with a strong level of commitment and consistency.”
That authenticity isn’t achieved overnight. In fact, retail leaders should be wary of overhyping their brand’s commitment to environmental or social causes. Authenticity “is used quite often by brands about themselves — which is wrong. You can’t self-describe yourself or brand as ‘authentic,’ Gavigan says. “It’s a view or observation someone has about you.”
“You can't self-describe yourself or brand as ‘authentic.’ It's a view or observation someone has about you.”
Trust and transparency require extra effort
Transparency is essential to earning and maintaining customers’ trust, which is “the golden asset all brands need to seek, build, uphold and vehemently guard,” according to Gavigan. Promoting transparency is not easy, however, and can run counter to traditional corporate thinking.
Fully realized transparency requires that retailers hold themselves to a higher standard, exceeding the minimum necessary to satisfy legal requirements or defend against reputational threats. This can be difficult in times of crisis, but also offers an opportunity to strengthen relationships with customers.
After IKEA recalled 29 million chests and dressers in mid-2016, the company maximized the announcement’s reach instead of downplaying the setback. “[We] decided to go beyond the standard recall communication by running a national ad campaign. It was important to us that we not hide the recall,” Petersson says.
Similarly, The Honest Company provides extensive disclosure on ingredients and the sourcing of materials, even though this level of transparency is rare in the industry. “With a name like ‘The Honest Company,’ we embraced (and celebrated) the self-imposed challenge of being open,” Gavigan says.
This openness is especially valuable for attracting Millennial customers. These consumers, an increasingly important segment for retailers, “expect transparency, and are more likely to trust companies that are honest about their social responsibility efforts,” Petersson says.
Lars Petersson (left) and Christopher Gavigan (right)
“It’s very important to us that our stores are good neighbors in their local communities.”
Cultivating community engagement
The sheer size of large, growing brands can serve as a barrier to fostering connection with local communities and individual customers. To avoid seeming impersonal or distant, retail leaders recommend pushing a company’s representatives to directly engage with the people and areas around them.
“I’ve been traveling a lot recently to get in tune with local parents’ groups and influencers. I can’t get out there enough, telling our story, showcasing how we are special and different, and clearly articulating how Honest is a true collision of passion and purpose,” Gavigan says, underscoring the importance of the relationship between customers and a company’s top leaders.
A similar approach guides IKEA’s goal of transforming its stores into valuable community members. “It’s very important to us that our stores are good neighbors in their local communities,” Petersson says. “Our national community involvement activities make a difference in the communities around our stores. For example, since 2011, the IKEA Life Improvement Challenge has resulted in 204 makeover projects to nonprofit organizations in our communities.”
Together, community-focused engagement, transparency and a consistent commitment to acting on core values create a comprehensive appeal for socially conscious consumers.
Want to learn more about IKEA and The Honest Company’s socially conscious approach? See Christopher Gavigan and Lars Petersson speak at Retail’s BIG Show, to be held January 15-17 in New York.