This much we know: Nowadays consumers demand more from brands. The pandemic has served as a wake-up call for our consumerist culture.
For a satirical look at this post-pandemic consumer skepticism, check out the Netflix comedy special Inside, with a sketch starring comedian Bo Burnham as a brand consultant who churns out political stances for popular perishables from Bagel Bites to Butterfingers. “The question is no longer, ‘Do you want to buy Wheat Thins?,’ he earnestly intones. “The question is now, ‘Will you support Wheat Thins in the fight against Lyme disease?'”
Burnham is riffing on the fact that today we are more discerning of the way our purchases are messaged, packaged and distributed. And in this brave new world of direct-to-consumer (DTC) e-commerce, it’s clear companies must rework their entire systems, from supply chains to hiring and product development.
Nevertheless, those corporations persist in pursuing revenue growth and increased shareholder value at the expense of neglecting environmental issues and shirking social responsibility. Take Nestle, the folks that brought you “Good Food Good Life.” Recently the company acknowledged that more than 60 percent of its processed food and drink products don’t fulfill “a recognized definition of health”, and some will never be healthy no matter how much it tries to revamp them.
The truth is, consumer goods giants like Nestle, Procter & Gamble, Unilever and Kraft-Heinz have made their billions by staking a claim to convenience and reliability, not healthful living. But their consumer packaged goods (CPG) brands increasingly compete in a market where more and more buyers are suspicious of big businesses with socially conscious messaging that rings hollow. Pair that with the shiny new promise of DTC brands, and welcome to a brave new world where consumers can smell inauthenticity a mile away.
Now that consumer skepticism has gone mainstream, legacy giants must navigate those shifting tides by bringing in new blood to overhaul supply chains and harness the power of scale. Moreover, there’s a lot that CPG brands can do to get better in sync with consumers’ changing expectations.
Be willing to rebuild
Whether it’s Mondelez International with Oreos or SC Johnson with Mrs. Meyers hand soap, billion-dollar companies are still spending a sizable portion of their marketing budgets on proprietary research and development when it’s no longer just what’s inside the box that counts but how the box gets there.
For instance, shipping produces more carbon dioxide than all of America’s coal plants combined. As entire countries grapple with the demands of their citizens’ Amazon Prime-powered lifestyles, we’ve never been more aware of the fragility of our global supply chains Consider the Ever Given ship and its 18,300 cargo containers released only this month after getting stuck in the Suez Canal in March. Nothing screams runaway capitalism like a monstrous cargo vessel full of undelivered goods washed ashore.
For far too long the dialogue surrounding sustainability has focused on materials instead of pinpointing the root of the problem. Challenging big social problems demands knowledge and practices that incentivize creativity and innovation over scale and profitability. Consider that by changing its supply chain, a popsicle brand could take an action ultimately more purposeful and effective than simply slapping the magic word “recyclable” on its packaging.
Nothing says true commitment like hiring
Big brands need to identify all the possible touchpoints that can engage and challenge dominant narratives within their sphere of influence. And not just do it superficially, but really put their money where their mouth is. Hire people with diverse perspectives and lived experiences–and not just to check some diversity, equity and inclusion (DEI) box. If the goal is to practice human-centered design and influence consumer behavior, you can’t skimp on budgets for participatory formats, and you certainly won’t get there with homogeneous teams.
In April, Unilever-owned Degree designed and released an inclusive deodorant, for which it partnered with occupational therapists, consultants and more than 200 people with disabilities during research trials and feedback sessions. That initiative goes hand-in-hand with its goal that people with disabilities will represent at least 5 percent of its workforce by 2025.
Says disability advocate Josh Loebner: “If brands don’t commit to welcoming people with disabilities, they’re not only missing out from a dollar standpoint–they’re missing out from a brand loyalty standpoint.”
Utilize what e-commerce doesn’t have: scale
Thanks to their ability to pivot and redesign faster, DTC brands are rising competition against more traditional, store-bought CPG brands. But the DTC model only seems to have a leg up on its rivals in accelerating change as long as scale isn’t factored into the equation. Traditional CPGs must get out of their own way and embrace the enormous potential they have to transform behaviors and entire distribution systems.
One example of a DTC brand that affected the evolution of CPG brands is Dollar Shave Club, which offered a cheaper alternative to Gillette and the like. But in offering a monthly razor subscription, Dollar Shave Club risked being wasteful of single-use plastic. That provoked the industry to explore a more sustainable razor option, in turn giving rise to outfits like Leaf Shave, Oui the People, and Billie. In time, many of these brands may well be acquired by large corporations, but until then they will continue to challenge how traditional CPGs approach product development.
Legacy brands haven’t taken a closer look at themselves in a long time. Instead, they stayed the course, running on auto-pilot with tried and true tactics that worked over and over. If, on the other hand, they go against what’s been business as usual, partner with agents of change who know how to lead brands, boards and brand managers through choppy seas, they have a bonafide opportunity to affect change on a much larger scale than merely out-dueling e-commerce brands for market share.