Pros and Cons of Strategic Sustainability

February 21, 2019

Pros and Cons of Strategic Sustainability

 

By ignoring the growth of the resale market, retailers are missing out.  The resale market today is worth $24 billion[1] and is expected to double in less than 5 years. Retailers have something that the resale market doesn’t have – they know what their customers purchased and when. They can use this to their advantage.

 

The benefits of strategic sustainability are many.  They include:

 

·     Eco-friendly stance.  Promoting sustainable disposal options positions retailers on the positive side of environmental impact.  

 

·     Brand enhancement.  Customers are searching forsustainable solutions for disposing of items they are no longer using.  Traditional resale methods are described as cumbersome and time consuming.  

 

·     Brand control.  Taking charge of the end of life disposal process gives retailers more control over how and where their brand is positioned within the resale ecosystem.  

 

·     Customer and product knowledge.  Embracing the end of life process provides new insights into what consumers value and how they use their products.  Retailers who work with Rohvi have used these insights to influence purchasing and pricing of new items.  

 

Consumers are open to having more than just a transactional relationship with retailers.  Cognizant,an IT consultancy wrote in a recent whitepaper, “Retailers that will thrive and prosper in the digital economy will be those that think beyond the products they sell to providing hyper-personalized shopping experiences that surprise and delight the consumer at each interaction, regardless of channel or touchpoint.  With an increasing focus on convenience, community, curation and immersion, these retail experiences will become synonymous with the retailer’s differentiated brand promise and, therefore, core to buildingconsumer loyalty and advocacy”.[2]

 

Personalization can be a catalyst for deepening customer engagement.  It can cut through the noise of irrelevant offers and the repetitiveness of sale and discount messaging.  Consumers would much rather hear something relevant than waste their time on messages that don’t matter to them.  As such, 61% of American consumers say that they are willing to share data with a company if it means that the messages they receive from them are customized.[3]  More and more, this desire for personalized communications is becoming a purchasing determinant.  Research shows that more than half of consumers are somewhat likely to switch brands if a company doesn’t make an effort to personalize their communications to them.[4]  

 

There are some cons associated with strategic sustainability.

 

·     It takes time.  While it might be easy to just apply the word “sustainable” to your website or to run a generic bring back campaign, customers see through these behaviors.  Strategic sustainability is not just a “sale campaign” rebranded for Gen Z.  Make surethat if you are going to adopt “strategic sustainability” that you are transparent to your customers about what this means.  It is part of consumers’ lives now – and they expect it to be part of yours too.  

 

·     Disruption to traditional business processes.  Evaluating the success of a sales campaignf ocuses on the immediacy of results. Strategic sustainability takes a long-term view of customer engagement and positions the consumer and the retailer to win in the long term.  

 

When strategic sustainability leverages personalization, it is an inherently collaborative venture.  As one marketing vice president put it,“You need to make sure the organization doesn’t get in the way.” Yet at 60% of companies, no one team is responsible for personalized cross-channelcommunication to consumers, and 54% of companies say they have no or low cross-functional coordination for personalization efforts.[5]

 

·     Set up investment.  Some upfront work in cleaning data and testing processes is required to develop an approach that works for both you and for your customers.

 

While it’s easier to stay the course and keep doing what you’re doing, retail trends are saying loud and clear that that’s not working for most retailers.  Consumer needs have changed as have retailer capabilities.  

 

Strategic sustainability is one way to meet these consumer changes head on in a retailer positive way.  


[1] ThredUp Resale Annual Report 2019

[2] Retail’s Next Frontier  Cognizant. July 2018.  

[3] 61%of Americans Will Share Personal Data for Personalized Marketing Communications. Inc Magazine.  John Koetsier.  August 8, 2018.  

[4] SalesforceCustomers are Willing to Swap More Data for Personalized Marketing.  DevonMcGinnis.  November 2016.  

[5]“Profiting from Personalization”. BCG. May 8, 2017.  

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