Will 'Sustainability' be the keyword for brands in the years to come?

With major brands taking sustainability pledges to protect the environment, a recently released report by Kantar started a new conversation around the market scenario and how marketers can plan effective campaigns based on the initiatives taken by the brands across the FMCD (Fast Moving Consumer Durable) sector.

Kantar’s “Walking the Talk on Sustainability with Consumers – a roadmap for India’s FMCD Sector” report states that in 2019 people across the globe started having conversations over sustainability and eco-friendly goods, topics such as minimising the use of plastic and cutting down on unwanted packaging also gained prominence. It goes on to state that by 2022 when most of the world had already faced at least three waves of the Covid-19 pandemic, initiatives towards sustainability were being taken more seriously than ever before.

According to the Kantar report, consumer reactions in the wake of Covid-19 continue to evolve and the Indian market presents several opportunities for the FMCD brands. The report further states that cautious consumption is the norm, and Hygiene, Health and Wellness are key consumer concerns, where 91% of Indian households are washing hands more often now, 47% of Indian households claim increased toilet cleaning, more so in rural (49%) vs urban (43%).

In the FMCD sector, several brands have taken initiatives and spent heavily on marketing campaigns to increase awareness and to encourage the public to opt for the better options existing in the market. Coca-Cola, a leading beverage company took various initiatives as a part of its environmental, social and governance goals with three major initiatives, namely ‘World Without Waste’, ‘Fruit Circular Economy’, ‘Water Leadership’ with the intent to support and solve major environmental issues. Similarly, Ayurveda major Dabur India became a plastic waste-neutral company, having collected, processed and recycled around 27,000 MT of post-consumer use plastic waste from all over India in the 2021-22 financial year

Samit Sinha

Talking about the relevancy of sustainability amongst consumers and numerous brands trying to make their way through it, Samit Sinha, Founder and Managing Partner, Alchemist Brand Consulting, said, “In this doom and gloom scenario, the silver lining seems to be that more and more consumers are becoming increasingly conscious about the need for sustainability. A major study (The Global Sustainability Study 2021, conducted by Simon-Kucher & Partners) of more than 10,000 people across 17 countries, reveals huge shifts in consumers’ attitudes and behaviour towards sustainability and an increased willingness to pay more for sustainable products and services. 85% of the respondents indicated that they shifted their purchase behaviour towards more sustainable products and services during the past five years. On average, more than 34% said that they were willing to pay a 25% premium for sustainable products or services.”

“Significantly, the demographic segments that are more likely to actively choose sustainable products and services are the millennials and Gen-Z. Since these two consumer groups represent the largest chunk of all consumers globally, it is no surprise that more and more brands today are seriously considering sustainable alternatives,” he added.

While many brands actually execute initiatives and talk about them simultaneously in a subtle fashion, many companies are still figuring out how to market their initiatives in their favour.

Nisha Sampath

However, there are also some companies that may go all out on the marketing aspect but would not execute the initiative with the same enthusiasm. Nisha Sampath, Managing Partner at Bright Angles Consulting LLP, said, “It's extremely important for a sustainable brand to be authentic, as today's consumers are savvy enough to detect 'greenwashing'. Brands should also remember that the core of sustainability is about humility. Basically, it's humans recognising the degradation of the earth and taking small steps to correct it. Pretend to be doing more, and it will get the brand to be called out by consumers.”

“I remember that I was doing a research interview with a consumer for a 'green' brand and the respondent told me 'but you are not a green brand, You have to ship products from another city, so you have a carbon footprint. I would rather buy local.’ So, consumers can be one-step ahead,” she added.

Sridhar Ramanujan

Sridhar Ramanujan, Founder CEO at Integrated Brand.Comm, said, “There are three types of companies, one is a company that actually executes initiatives but doesn’t talk much about it, the second type are those who will not do anything but will keep talking about things that they are going to do, the third is the companies which will execute initiative and simultaneously talk about it, like Infosys. Companies should be sensitive while talking about their initiatives because the consumer these days is very concerned.”

Lloyd Mathias

Talking about brands taking advantage of sustainability and including it in their marketing plan, Lloyd Mathias, Independent Director and Business Strategist, said, “Many companies are issuing a sustainability report with their financial results. Many companies are setting themselves carbon emissions targets and attempting to reach net zero in a definitive time frame. In sectors like automotive major players like Tata Motors, Mahindra and Hero MotoCorp are actively shoring up their electric vehicle portfolio with new launches.”

Alchemist Brand Consulting’s Sinha said, “The issue of sustainability definitely gained prominence during the pandemic. It brought home the importance of nature and the helplessness of humans against the fury of nature. This made both human and environmental health concerns more urgent. This also created a greater appreciation of brands that stood for ethical, fair trade and cruelty-free practices. We now see instances of cosmetic brands that are looking to be 100% vegan also trying to get PETA certification, as it means they’re cruelty-free.”

Numerous brands are still adapting to the trend as product pricing, packaging becomes a big issue while trying to get on the sustainability bandwagon. According to the Kantar report, ‘value’ is a key factor for consumers since post-pandemic financial concerns have cropped up, where 73% attribute Covid to have impacted household income, while 67% pay greater attention to prices while shopping.

As per Mathias, the trend will continue to grow in the coming years, making brands adapt to the demand of consumers. He said, “It is increasingly clear that companies will have to consider environmental matters at the heart of their strategy and operations. The need is driven by key stakeholders – investors, consumers and employees. Investors want to invest in clean businesses which do not harm the environment; consumers increasingly are seeking higher standards from brands they chose and even employees are concerned about their employers’ environmental impact.”

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