Futerra's 3 P's model of behavior change | Image credit: Futerra/Eight Sustainability Platform

Is It Best to Approach Behavior Change from Inside or Outside of Your Company?

Work on behavior change cannot be considered a new area; various institutions, especially governments, have long sought to influence individuals’ behavior in areas such as health, transport, family planning, etc. It is also not new for companies and brands to attempt to influence behaviors and needs through marketing. What is new is the use by companies of more complex methods for influencing individuals, especially consumers, for sustainable choices.

For Business to Consumer (B2C) companies, engaging with consumers could be considered essential to the consolidation of their models for production and consumption and for the survival and expansion of their businesses and brands. One key way to further their sustainability agendas is to find ways to influence their consumers to choose more sustainable products and services and adopt more conscious habits in their daily lives. This will help these companies lessen their impact and costs, as the majority of their environmental footprint is often caused by consumer use and post-use of their products and services. At the same time, working to influence behavior can also lead to closer ties between companies and their consumers, building trust, empathy and admiration. Companies can also find innovative solutions for their products and services by working with their consumers, who may be willing to help, through open innovation, crowdsourcing and offline interactions.

A group of leading companies is trying to implement consumer behavior change models globally and looking to take competitive advantages from this. As an example we can cite Unilever — one of the world’s largest consumer-goods companies, whose cleaning, personal hygiene and food products are used by two billion people each day. The company’sSustainable Living Plan aims to double the size of the business while reducing its environmental impact by 50% within 10 years. Unilever, which launched this plan in 2010, smartly assumed it can not achieve this without deep engagement with its consumers.

It’s a challenge for those B2C companies, however, to develop a framework to influence consumers’ behavior, adapting it to the reality of different global markets, consumers and the company’s sector, products, business and sustainability strategies. Looking at the urgency for sustainable solutions to production and consumption patterns, the main challenge is to look for answers to these questions not just in the developed countries but especially in the BRICS and many other large and growing markets, such as Turkey, Peru, Indonesia, Chile, Malaysia, etc. Companies must understand the increasing influence of these countries on global production and consumption and develop instruments and strategies for influencing consumers, connected with their brand strategies and values proposition. This is key because of the specific characteristics of these markets and consumers and the impacts they can have (and have had) on the global production and consumption system, which from a social and environmental perspective is already saturated.

Some questions to go deeper on these approaches include how companies can build and structure instruments to influence consumers, with different levels of purchasing power and adherence to sustainable choices in these markets. Another question to ask is how these instruments can be used to influence the new middle classes of these countries, who are entering the market with a hunger for consumption. Companies cannot just deny their desires, but they cannot also just reproduce the western production and consumption model, which is unsustainable in a context of scarcity of natural resources and increasing raw material prices, among other pressing trends.

In attempting to answer these questions we see that this is not just about B2C companies’ relationships with their consumer stakeholders, but also (and mainly) a dilemma between companies’ growth goals and their influence on sustainable consumption in these markets.

To address these main challenges, we at Eight Sustainability Platform recently launched in Brazil the Emerging Economies Consumer Behavior Change Project, in partnership with Futerra Sustainability Communications, the Brazilian Business Council for Sustainable Development (CEBDS), the Instituto Akatu and Sustainable Brands, sponsored by Banco Itaú and supported by Dow, Nestlé, Unilever, Invepar and PepsiCo.

Some of the initial learnings of the project make clear the need for a behavior change framework that is adapted to the different companies’ business drivers, integrating it with global and local sustainability strategies. It also requires the commitment and capabilities of different company areas, including not just sustainability and communication departments, but also marketing, R&D, brands and consumer research. Some ways of tackling this dilemma of growth versus sustainable consumption will be found, I believe, by companies working hard internally to understand how innovation and techniques for influencing consumers can be built into an effective approach as strategic purpose, recognizing and facing up to the problems of internal resistance, lack of knowledge and capabilities on the issue.

Taking Brazil as a case study, we understand that it is essential to design behavior change models and instruments that go far beyond the traditional instruments of corporate communications and advertising, and their traditional focus on the environment, i.e. the “save the planet approach,” which in general consumers do not understand, trust or respond to. For several years now, NGOs, governments, educational institutions and companies have sought to raise the awareness of individuals and engage them in the search for more “sustainable” attitudes and habits, including consumption, mainly through education and communications campaigns. However, research has shown that having information and being aware of the impact of a particular behavior is not in itself enough to change this behavior. A lot of progress has been made in raising awareness, but more needs to be done in terms of changing the practical responses and behavior of individuals.

Some different researches that we have analyzed in our white paper showed clearly this gap between intention, awareness and action: There has been an increase in the environmental awareness of Brazilians, but this has not been translated, at least at the same scale or pace, into sustainable consumption behaviors. We believe that a great part of this is also due to the fact that consumers are confused by these issues, mainly by the way organizations have been treating the topic, without connection with the different values and motivations of people, which are certainly far more complex than just “save the planet” perspectives.

One of our main initial learnings pertains to the need for companies to understand that individuals and behavior are not homogenous — people are guided in their decisions in different ways and respond differently to contexts and stimuli. Different values and social and psychological factors affect the behavior of both individuals and groups. Various research studies have tried to classify individuals into groups that share the same motivational factors. Companies already use their consumers’ different profiles in their marketing approaches; why should they treat people and their values differently if every consumer faces sustainable consumption choices in the same way? This is the heart of the matter.

Furthermore, the identification and segmentation of behaviors to be changed is the starting point for any behavior change strategy. It is important to know which behaviors are to be promoted and which ones discouraged. It is not possible to work on all behaviors at the same time, generically, and with the same approach for different groups of individuals; in our study, we started identifying target behaviors by sector, and this is just the beginning of the task at hand.

Despite knowing “why” and “what” we need to do in terms of consumer behavior change in emerging economies, our main challenge is work on “how” to achieve this. A number of models for changing behavior have been developed and adapted to the challenges facing companies and brands but they are all western-centric and must be adapted to Brazil or any other emerging market. These models highlight different aspects and represent different approaches to the complex challenge of influencing behavior, whether applied by governments, companies, NGOs or others. Our challenge is just beginning: We don’t have all the answers yet, but we know enough to see how much work we have in front of us.

In summary, we came to some early conclusions:

  • Creating engagement inside a company will help bridge the gap between the company’s discourse, reality and a business/sustainability strategy. This process can be helpful in assessing the amount of work needed to change attitudes, behavior and decision-making processes.
  • Concerning consumers, the work to be developed can be split into two main directions: The first is to understand how companies and their marketing, communications, research and other teams see and understand their consumers, their attitudes and their motivational values that guide their daily choices. The will help companies realize how the behavior change approach is seen by these team leaders and understand the main needs, barriers, opportunities and risks to adopting it.

In addition, to accomplish this complex challenge, these efforts need to be carried out in accordance with the realities of the company’s sector, the local market and the specific consumer behaviors that need to be understood and influenced.

From this series of data, a set of strategies can be drawn up to identify internal and external attitudes and the necessary behavior changes. This work will also clarify the main challenges faced by companies and brands in connecting their actions and strategies and achieving recognition for their value proposition.

SB2013

Eight Sustainability no Sustainable Brands San Diego

A partir de hoje estaremos presentes no Sustainable Brands Internacional, em San Diego, Califórnia, que acontece até o dia 6 de junho. 
Seremos um dos expositores da Conferência e teremos um momento para compartilhar com os membros do SB os aprendizados iniciais do projeto Emerging Economies Behavior Change.

Mais infos sobre o evento no link http://www.sustainablebrands.com/events/sb13

san_francisco

Sustainable Brands Unites Global Partners for First Look at Project on Sustainable Consumption and Consumer Behavior Change

SAN FRANCISCO, California, May 8, 2013 – Sustainable Brands® announced today that the Emerging Economies Consumer Behavior Change Project was launched at the Sustainable Brands Rio conference in Brazil. Led by Eight Sustainability Platform, in partnership with Futerra Sustainability Communications, the Brazilian Business Council for Sustainable Development (CEBDS), the Instituto Akatu and Sustainable Brands, it is the first project to explore the cutting-edge issues of sustainable consumer behavior change exclusively for the Brazilian market. Read more
collaborative-consumption

Collaborative Consumption and the Sharing Economy in Developing Markets

This is an edited excerpt from Pablo Barros’ upcoming book, Behaviour change, consumption and sustainability: how companies can influence individuals in a world in transition, due for publication in September 2013. 

While companies and governments continue to explore new ways of influencing the decisions of individual consumers, there are also a number of increasingly visible social and economic trends that are emerging and pointing the way to alternative and more sustainable forms of consumption. These trends have the potential to mount a major challenge to the hyper-consumption of today’s global economy. It is largely in the fast-growing economic powerhouses of the developing world — such as Brazil — that the extent of that potential will be determined.

These disruptive trends include the growing practice of collaborative consumption, a rapidly evolving model that leverages the power of the Internet, smartphones and social networking and has skyrocketed in popularity during the economic slowdown in the developed world. In addition to well-known sites such as eBay and Craigslist, trusted resources for the sale or exchange of used goods and other products and services, innovative new players — such as holiday rentals site Airbnb, carsharing marketplace RelayRides and errand service Task Rabbit — have achieved significant success by harnessing the ability of social media to create social connections and credibility.

Globally, collaborative consumption can be dated back to 2005, but it has gathered force in the US since the financial crisis of 2009 and the start of the Great Recession, and has also been widely adopted in Europe. One of the main factors contributing to the success of the model seems to have been the pressure on household incomes, as well as the increased penetration of mobile Internet applications and social media, and the growing consumer demand for more sustainable lifestyles and use of resources. But will traditional consumers in emerging markets adopt these practices without the prodding of an economic crisis?

The trend is already gaining traction in some emerging markets. In the last decade, Brazil has added around 30 million people to its middle class, a group whose spending is largely responsible for the country’s strong economic growth. This surge in spending is coinciding with the emergence of a new range of popular collaborative consumption services made available by mobile communications technology, the Internet and social networking. For example, in the last two years several cities have successfully implemented bicycle-sharing systems, including Rio de Janeiro, São Paolo, Porto Alegre and Recife. Rio’s system, which just like its peer in London is sponsored by a large bank, enables both residents and tourists to rent bicycles at low cost using their mobile phones. Its unqualified success points to the high potential of the Brazilian market for collaborative consumption, and belies the myth that such services can only gain traction in more sophisticated economies.

 

Urban Brazilians are already among the world’s most avid users of online services and particularly social networking, as evidenced by the rapid growth in recent years of local collaborative consumption services that extend well beyond bicycle sharing — examples include Descola aí, where consumers can sell, exchange and buy products and services; and Babags, a network for renting luxury bags in Rio. The Brazilian collaborative consumption sector has also received major investments from outside, such as from the global marketplace OLX, which records about 60,000 transactions per day and has advertised heavily in Brazil.

 

The question remains: Do these systems represent a credible and viable alternative to the ongoing consumer boom in the developing world? This is a critical issue for consumer-facing organizations in these markets. In Brazil, leading players in the economic system are engaged in analysing and trying to better understand how and why consumer behaviour is now changing so dramatically.

There are now three generally accepted ideas as to what is going on around the world’s consumer markets:

  • Firstly, there is an ongoing paradigm shift about what it means to own a car, a bicycle, a household appliance, a book, a film or a piece of clothing. The value of a product is beginning to be seen in terms of its use, not in its outright ownership, as per traditional consumer models.
  • Secondly, there is an increased level of acceptance of used products, thanks partly to the popularity of online platforms for buying and selling used goods.
  • Finally, people are also adopting what could be called collaborative lifestyles, in which not only goods are shared but people share their time, space and expertise.

These new models of consumption are gaining such popularity that every day new businesses spring up based on this model; the development of the sharing economy has the potential to bring about a revolution in how we consume and how what we consume is produced. According to an article by Jaime Contreras in MIT Sloan Expert, collaborative consumption is a potentially $110 billion market. Traditional corporations are now moving rapidly into the space; Avis Budget recently purchased Zipcar; RelayRides has received an investment from General Motors; and BMW has agreed to a partnership with ParkatmyHouse.com. Furniture giant IKEA has also carried out pilot programmes that aim to incentivise consumers to sell its used furniture.

While all these initiatives are focused on developed markets, according to the World Economic Forum some 70% of the global middle class will reside in developing countries by 2030. In middle-income countries such as Brazil, many of which are experiencing an extended consumer boom, and where per capita spending is set to converge with that of developed countries, can collaborative consumption lead to a more sustainable model of production and consumption? Can it help the developing world avoid the mistakes of developed economies?

In the book What’s Mine Is Yours, social innovator Rachel Botsman argues that there are four factors needed for a successful business model based on collaborative consumption: sufficient critical mass, available capacity, belief in the commons, and trust and credibility between strangers. All of these are present to varying degrees in developing markets such as the BRICs, which are collaborative consumption giants in the making. The only unknown is the speed with which collaborative consumption services will emerge and be taken up as an alternative to traditional hyperconsumption. Any companies operating in developing markets will need to understand and plan for the potential impact of these services, and consider how to redefine their services to reflect the growing demand for common access to assets.

We expect that in developing countries there will be a reinvention of business models in various sectors as a result of the disruptive influence of collaborative consumption. But as the growing populations and expanding middle classes of developing economies such as Brazil, China and India exert increasing pressure on natural resources, collaborative consumption represents an exciting and sustainable alternative that we ignore at our peril.