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CX Insight Magazine

July 2023
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in this issue

Outsourcing to Africa: Top Countries for BPOJoin the New Era of Innovation: Overcoming Obstacles to AI AdoptionBRAND SPOTLIGHT: woom BikesThe EX Factor: Identifying and Transforming Employee JourneysKIA Online Community Member Spotlight: Delta Faucet CompanyEnterprise-Grade Generative AI with MovateUnderstanding the Customer Experience Journey: A Comprehensive OverviewVoice to Visualization: Powering Actionable Insights with Voice Analytics The Rise of Environmentally Conscious Consumers: CX Reimagined for SustainabilityThe Prompt Toward a New Era of CXMeasuring AI Performance: Are You Leveraging LLMs’ Analytic Capabilities? Back to Table of Contents

The Rise of Environmentally Conscious Consumers: CX Reimagined for Sustainability

As the world looks for more environmentally friendly ways to live, many consumers are increasingly aware of the impact their purchasing decisions can have on the planet. 

by Execs In The Know

In recent years, consumer behavior has significantly shifted, as more individuals prioritize sustainability and environmental consciousness in their purchasing decisions. The rise of eco-consciousness has brought a new wave of responsibility to the world of business. And, as a result, organizations are now reimagining customer experience (CX) for sustainability’s sake.

This article will explore the reasons behind the surge in environmentally conscious consumers and discuss how organizations can reimagine their CX practices to cater to this growing market segment.

A Shift in Consumer Behavior

In 2021, the IBM Institute for Business Value (IBV) found that 93% of global respondents  said the pandemic had influenced their views on sustainability. And more recently, environmental issues have become even more important. 

People are becoming more conscious of how their choices impact the planet and are actively seeking eco-friendly alternatives. This shift in consumer behavior is driven by various factors, including greater access to information, the influence of social media, and the realization that individual actions can make a difference.

  • According to a 2020 McKinsey US consumer sentiment survey, more than 60 percent of respondents said they’d pay more for a product with sustainable packaging. 
  • Consumers across all generations—from Baby Boomers to Gen Z—are now willing to spend more for sustainable products.

Consumer Statistics About Sustainability

Are consumers making decisions based on a brand’s sustainability practices? The following data shows that’s exactly what’s happening:

  • According to Gallup, close to two-thirds of U.S. adults are concerned about global warming, with 43% worrying about it “a great deal” and 22% “a fair amount.”
  • There has been a 71% rise in online searches for sustainable goods globally, over the past five years.
  • 90% of Gen Z consumers surveyed have bought a sustainable product in the past six months.
  • 70% said they would change their shopping habits if they discovered that a store or brand wasn’t operating sustainably.

What Companies Are Doing to Become More Sustainable

Today’s CX leaders find themselves navigating the interplay between safeguarding the planet in the long run and immediate financial interests. Brands with sustainability top of mind are moving in different directions and at different speeds to implement changes from pledges and offsets to altering the products and packaging they manufacture.

Nearly all of the world’s top 250 companies (G250) report on sustainability. New research from Boston Consulting Group (BCG) shows that more than 60% of companies consider environmental, social, and governance
(ESG) factors a primary focus or a key criterion for selecting and prioritizing digital initiatives, and more than 80% plan to increase their investments in sustainability. ESG transcends mere intentions, encompassing a concrete, actionable strategy that yields tangible outcomes. True achievement extends beyond climate change, diversity, and disclosures; it necessitates ingraining these principles throughout every facet of your enterprise, spanning investment to sustainable innovation. 

By uniting top talent and cutting-edge technology, CX leaders can gain enhanced insight and respond swiftly, empowering them to confront present-day’s major hurdles and seize tomorrow’s most promising opportunities.

Brands have a chance to not only share where they stand on sustainability but to drive real change. While no single organization can reverse the tide, the decisions leaders make can have a ripple effect across the global economy. A recent study by the World Economic Forum found that just eight supply chains account for 50% of all global carbon emissions.

As climate change intensifies, companies across industries are revolutionizing their strategies to create a sustainable future that benefits everyone. They’re actively reducing emissions, minimizing consumption and waste, and protecting biodiversity. Supply chains are adapting, materials are changing, and travel is carefully evaluated.

But here’s the key: businesses can’t do it alone. 

How Employees View Sustainability

 

The role of values and purpose in attracting and retaining talent has become increasingly important when considering business priorities. As a growing number of employees consider a company’s climate policies, organizations are increasingly putting sustainability front and center.

People care about sustainability and climate change, which influence not only their purchasing choices but their employment preferences. Along with a fair wage, employees seek employers whose values are consistent with their own. According to a 2021 Gallup survey of 1,010 U.S. adults, 43 percent express significant concern about global warming, with an additional 22 percent feeling moderately concerned. A small minority, 18 percent, and 17 percent respectively, have minimal or no worries about it.

Furthermore, companies that lack sustainable practices are less attractive to job seekers. In a 2021 survey conducted by IBV, 71 percent of 14,000 global adults seeking employment expressed a desire to work for environmentally sustainable companies.

Organizations of all sizes are embracing ESG goals, presenting a chance to harness employees’ passion for the subject and drive tangible progress towards these objectives while pursuing other business goals. Brands are taking the lead on engaging employees
on environmental sustainability and strengthening their culture, talent retention,
and employee satisfaction.

The Importance of CX in the Sustainability Movement

Customer experience has always been a critical aspect of business success. In the context of sustainability, CX plays an even more crucial role. Environmentally conscious consumers expect companies to demonstrate their commitment to sustainability throughout the entire customer journey.

Every touchpoint represents an opportunity to reinforce sustainable practices, from product sourcing and manufacturing processes to packaging, delivery, and post-purchase support.

Building Trust and Loyalty
Companies can cultivate trust and loyalty among environmentally conscious consumers by prioritizing sustainability in their CX strategies. Being transparent about sustainable practices, certifications, and the environmental impact of products fosters authenticity. This transparency is crucial in attracting and retaining environmentally conscious customers, who often research a brand’s sustainability efforts before purchasing.

Sustainable Product Offerings
To cater to environmentally conscious consumers effectively, brands can offer sustainable products or services. This involves using ethically sourced materials, minimizing waste, employing renewable energy sources, and reducing carbon emissions. Organizations can also explore product lifecycle management, encouraging recycling, repurposing, or responsible disposal. These efforts not only meet consumer demands but also contribute to a circular economy.

Personalization and Education
Providing personalized experiences and education empowers consumers to make sustainable choices. CX strategies should incorporate features that allow customers to customize products based on their sustainability preferences. Additionally, companies can educate customers about the environmental impact of different choices, providing information on carbon footprints, eco-friendly alternatives, or the benefits of sustainable practices.

Innovation and Collaboration
Embracing sustainability necessitates innovation and collaboration within and between industries. Companies can reimagine their CX practices by actively seeking eco-friendly solutions and collaborating with suppliers, partners, and customers to drive sustainable initiatives. This collaborative approach fosters shared responsibility and demonstrates a genuine commitment to environmental stewardship.

Embracing Technology
Technology plays a vital role in reimagining CX for sustainability. Implementing smart systems to optimize energy usage and leveraging data analytics for supply chain optimization are just a few examples of how technology minimizes environmental impact. Companies can also utilize digital platforms and social media to communicate their sustainability efforts, engage with environmentally conscious consumers, and amplify their initiatives’ impact.

Transforming from the Inside for the Outside

The emergence of eco-conscious consumers is transforming the business realm, demanding a fresh approach to CX strategies. Companies that prioritize sustainability in their CX efforts have a unique opportunity to earn the trust, loyalty, and support of this expanding market.

In today’s world, both consumers and employees are urging corporations to play their role in combating climate change. Though achieving a fully sustainable future may appear daunting, companies can make a real impact by taking meaningful steps toward sustainability. It’s not an all-or-nothing endeavor.

By embracing this challenge, forward-thinking companies stand to gain significant advantages, while paving the way for a better world for generations to come and meeting customer expectations. As environmental responsibility gains increasing significance, integrating sustainability into CX is becoming an essential factor for long-term success in the business landscape.

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