Customer Loyalty Trend: Shared Values Matter
Loyalty Trend: Corporate Social Responsibility
Consumers worldwide expect brands to not only talk about what they stand for but what they stand up for and invest in brand activism on local, social and environmental issues that impact employees, customers, and their communities. The 2017 Cone Communications Corporate Social Responsibility (CSR) study found that 63% of Americans are hopeful businesses will take the lead to drive social and environmental change moving forward. Also, consumers are willing to reward or punish based on company values and company actions.
The global 2017 Edelman Earned Brand study found that 50 percent of consumers worldwide are “belief-driven” buyers, meaning that they will change their purchasing behavior — choose, switch, avoid or boycott a brand — based on its stand on controversial societal issues.
China indexes the highest with (73 percent) of consumers who are buying based on shared beliefs, India (65 percent) is close behind and is followed by countries like the U.S. (47 percent), Australia (40 percent) and U.K. (37 percent).
Shared Values Build Brand Loyalty
Buying based on beliefs is an uptrend, with 30 percent of consumers worldwide saying that they make believe driven purchase decisions more than they did three years ago. Consumers buy a brand, switch from it, or boycott it based on the brand’s stance on controversial or social issues. Sixty-seven percent will buy a brand for the first time based solely on the brand’s position on a controversial topic.
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Overall, Customer Insight Group is seeing a rise in consumer expectations for brands to take a stand and lead the movement for change and address critical issues. Brands that are inviting consumers to join them in action are being rewarded with more conversations, new buyers, and greater customer loyalty.
Wondering how brands are taking a stand?
This article is chock full of insights into consumer expectations and activities in support of corporate social responsibility. We pulled out the overreaching consumer insights and highlighted a few examples of how brands are taking a stand to live their beliefs.
To illustrate how critical corporate social responsibility has become, you need only to look at the impact it has on the strength of your customer relationships. The Edelman Brand Relationship index measures the overall strength annually of the consumer-brand relationships. In 2017, all consumers worldwide, on average, are in the Involved stage with a global index of 37 out of 100. Of the 14 countries included in the study, China indexes the highest in brand relationship strength (52 percent), followed by India (48 percent), USA (40 percent), U.K. (34 percent), and Australia (33 percent).
Belief-driven buyer’s index is much higher than the average consumers, at 46, putting them in the Invested stage and indicating that these buyers are already deeply connected to brands that support their causes and are more willing than the average consumer to buy first, stay loyal to, advocate for, and defend a brand. A significant segment of customers brands need to engage and keep — representing 50 percent of all consumers worldwide.
Belief-driven consumers are more loyal buyers of brands that speak up. Consumers want brands to be authentic in their corporate social responsibility by addressing how the issue is aligned with the brand’s core value and how it affects customers, products, manufacturing, and the communities in which the brand operates.
Believe-driven buyers will reward brands that are aligned with their views with a more significant share of wallet and their brand loyalty. Twenty-three percent will pay at least a 25 percent premium, 48 percent will advocate for the brand and defend the brand and criticize its competitors, and 51 percent will be loyal, buying from the brand exclusively and more often.
On the flip side, consumers will castoff brands that don’t talk about and act on social issues that they feel brands should. Sixty-five percent of consumers say that they would not buy from a brand that was silent on an issue that they think the brand has an obligation to address.
“This means there is a real possibility of consumer commitment well beyond the classic purchase funnel because active partnership with a brand gets customers invested as advocates and loyalist.” Richard Edelman, president, and CEO of Edelman
Belief-driven buyers’ number one source for reliable information about brands is through conversations with their friends and family. Belief-driven buyers find information gathered through peer-driven conversations (89 percent) more credible than statements by a celebrity spokesperson (69 percent), and belief-driven buyers rely on conversations with friends and family (31 percent) more than advertising (21 percent) to learn about the actions that brands take.
Brands Respond to the Mandate to Stand Up & Speak Out
We definitely see an increase in the elevation of corporate citizenship roles to executive status,” said Katherine Smith, executive director of the Boston College Center for Corporate Citizenship (BCCCC) in a recent article in Forbes. According to research from BCCCC, the number of companies directing corporate social responsibility from the C-Suite has increased by nearly 75 percent compared to five years ago.
Brands recognize the value of engaging belief-driven buyers, both inside their loyalty programs and beyond – with compelling campaigns standing up for social justice issues, companies tackling disaster relief in new and effective ways, and organizations sparking conversations on sometimes uncomfortable topics.
8 Corporate Social Responsibility Examples
Marriott International to Removes Plastic Straws Worldwide
Marriott International has adopted a plan to remove disposable plastic straws and plastic stirrers from its more than 6,500 properties across 30 brands around the world.
“We are proud to be among the first large U.S. companies to announce that we’re eliminating plastic straws in our properties worldwide,” said Arne Sorenson, President and Chief Executive Officer of Marriott International. “Removing plastic straws is one of the simplest ways our guests can contribute to plastic reduction when staying with us – something they are increasingly concerned about and are already doing in their own homes. We are committed to operating responsibly and – with over one million guests staying with us every night – we think this is a powerful step forward in reducing our reliance on plastics.”
Heineken® Open Your World Campaign
Heineken® launched a new Open Your World campaign in the U.K. to promote openness as a value that helps break through the barriers that divide us.
For more than 150 years, Heineken® has stood for openness, believing that the simple act of sitting down and having a conversation over a beer, helps bring people together. Heineken® put it to the test with a campaign which aimed to explore if the benefit of finding common ground with one another, can ultimately lead people to be more open.
The campaign kicked off with a social experiment that featured real people. ‘Worlds Apart,’ a real-life social experiment that puts together two total strangers that are divided by their beliefs, meeting for the first time. What happens when you bring together a feminist and an anti-feminist? Or a climate change activist with someone who thinks the whole idea is “piffle”? Heineken set out to prove that when you see past the labels, even the most divided groups can come together to find common ground. Apart from ‘Worlds Apart,’ the campaign included a study let by Goldsmiths University on the Science of Common Ground; an employee ‘Mix It Up’ campaign and Facebook Chatbot that connected people from diverse backgrounds.
CVS Health Stops Selling Cigarettes and All Tobacco Products
CVS Health was the first national retail pharmacy chain to stop selling tobacco products in all of its stores because it conflicted with their purpose of helping people on their path to better health.
“Ending the sale of cigarettes and tobacco products at CVS/pharmacy is the right thing for us to do for our customers and our company to help people on their path to better health,” Larry J. Merlo, president, and CEO of CVS Caremark said in a statement. “Put simply, the sale of tobacco products is inconsistent with our purpose.”
McDonald’s Transitions to Cage-Free Eggs
In September 2015, McDonald’s announced that it was fully transitioning to cage-free eggs for its nearly 16,000 restaurants in the U.S. and Canada over the next ten years. Given the company’s scale, the move promises to hasten a transition by egg producers to improve animal welfare. Since 2011, McDonald’s USA has been purchasing more than 13 million cage-free eggs annually.
“Our customers are increasingly interested in knowing more about their food and where it comes from,” said McDonald’s USA President Mike Andres. “Our decision to source only cage-free eggs reinforces the focus we place on food quality and our menu to meet and exceed our customers’ expectations.”
AmazonSmile – Customers Support Their Favorite Charitable Organizations
Customers who visit AmazonSmile (smile.amazon.com) enjoy the exact same low prices, vast selection, and convenient shopping experience – with the added bonus that Amazon donates 0.5% of the purchase price from any eligible purchases to the customer’s favorite charitable organization. Customers can choose to donate to nearly one million organizations around the country. By giving customers a choice of a charitable organization to support, Amazon makes their cause marketing efforts relevant to their buyers.
“We’re offering customers a way to support charitable organizations around the country that’s simple and automatic,” said Ian McAllister, General Manager, AmazonSmile. “We think customers will love the opportunity to support their favorite organizations without changing how they shop, and there’s no cap on how much Amazon will donate.”
Hilton Honors Members Donate Points for a Good Cause
Members of the Hilton’s loyalty program, Hilton Honors, can convert their Hilton Honors points and contribute to a variety of non-profit, charitable organizations.
“The Hilton Family is proud of its legacy of lending support to the communities in which we do business by way of event sponsorships, direct donations, and team member participation. The Hilton Family Giving Back Program will help raise awareness for truly worthy service organizations and inspire support for their endeavors,” said Adam Burke, senior vice president, and managing director of Hilton Honors Worldwide. “By extending our company’s philosophy to be hospitable(T.M.) into all facets of our business, we hope that Hilton Honors members will consider contributing their points and other resources to these groups and help make our communities and our world a better place to live.”
Go Red with Macy’s
Macy’s teamed up with the American Heart Association’s Go Red For Women® to raise money to fund lifesaving research and awareness that adds more time to women’s lives.
Macy’s customers who wore red or purchased an official Red Dress Pin for $3 during its Wear Red Sale received 25 percent off a selection of items storewide, plus an extra 15 or 10 percent off select departments. New this year, customers who purchased a Red Dress Pin – only available in stores – received a second one for free to give to a friend or family member. Macy’s donated 100 percent of pin sale proceeds to Go Red For Women. Additionally, Macy’s invited customers to round up their in-store purchase to the nearest dollar (up to $.99) and donate their change to Go Red For Women.
“Macy’s treasures our long-standing relationship with the American Heart Association,” said Holly Thomas, Group Vice President of Cause Marketing at Macy’s. “As a founding sponsor of the Go Red For Women movement, we’ve seen the importance of heart health awareness, and the power it has to change and save lives. This is a cause that many associates and customers have a personal connection with and, together, Macy’s is proud to have raised more than $65 million since 2004.”
KrisFlyer Miles Can Now Be Donated to Make-A-Wish Singapore
KrisFlyer has partnered with Make-A-Wish Singapore to enable members of the frequent-flyer program to donate miles to the charity, to facilitate the granting of wishes for children with life-threatening medical conditions.
“Our KrisFlyer members told us that they want more options to use their miles, including to use their miles for meaningful causes. We are excited to work with Make-A-Wish Singapore to enable KrisFlyer members to help more Wish Children realize their wishes,” said Singapore Airlines Senior Vice President of Marketing Planning, Mr. Tan Kai Ping.
Filed under: Brand Loyalty