Part 2

Webinar: Sustainability, where to start and what to do with Nicolai Broby Eckert, Senior Partner, Simon-Kucher & Partners and Author of "The Demand Revolution: How Consumers Are Redefining Sustainability and Transforming the Future of Business"

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Key Takeaways:

1. The Fatal Disconnect Between Consumers and Companies:

   • One of the most significant gaps in sustainability efforts is the mismatch between what companies offer and what consumers want. Companies often believe consumers are willing to pay a high premium for sustainable products, while in reality, most consumers are looking for affordable, accessible green solutions.​​

2. Consumer Segments Are Complex:

   • Nikolai highlights that consumers are not a monolithic group. His research identifies eight distinct consumer archetypes based on their sustainability commitment. These range from green champions willing to pay more in all categories to non-believers who aren't interested in sustainability at all. Understanding this segmentation is critical for businesses to target the right audience with the right products.

3. Sustainability is a Major Value Driver:

   • According to Nikolai’s research, 62% of consumers consider sustainability a top-three purchasing factor, alongside price, quality, and brand. This demonstrates that sustainability is no longer a niche consideration but a major factor in consumer decision-making across different product categories.

4. The Demand Revolution:

   • The shift towards sustainability is not just a trend—it’s a demand revolution, where the majority of consumers are looking for sustainable products. Companies need to acknowledge this shift and innovate accordingly to meet this demand while also making green products more affordable.

5. Barriers to Adoption:

   • While consumers want green products, barriers like affordability, availability, and confusing green claims (greenwashing) prevent them from making sustainable choices. Companies need to remove these barriers by making sustainability easy and transparent.

6. Strategic Plays for Companies:

   • Nikolai introduces six strategic plays for companies to adopt in their sustainability journey:

     1. Longevity: Focus on creating durable products that last longer (e.g., Bang & Olufsen's design-for-life philosophy).

     2. Brand Play: Position sustainability at the core of your brand (e.g., Patagonia, Porsche).

     3. Mass Affordability: Reduce the cost of sustainable products for the masses (e.g., Tesla’s push for affordable electric cars).

     4. Anti-Waste: Minimize waste across the product lifecycle (e.g., soda companies focusing on reducing plastic use).

     5. Ease of Choice: Simplify green product availability and make it easier for consumers to choose sustainable options.

     6. Engagement: Involve consumers in your sustainability journey through loyalty programs, co-creation, and honest communication (e.g., LEGO’s approach to customer engagement).

7. Regional Differences in Responsibility:

   • Consumers from different regions hold varying beliefs about who is responsible for sustainability. In Scandinavia, people expect local politicians to take action, while in Southern Europe, consumers feel they have a personal responsibility.

8. Sustainability is a Consumer-Driven Megatrend:

   • Unlike traditional technology-driven trends, the sustainability shift is entirely consumer-driven. This makes it imperative for businesses to respond quickly, as consumers are already adopting green behaviors en masse.

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Aha Moments:

• Consumers Will Invest Time for Green Choices: One striking insight is that when consumers decide to go green, they’re willing to invest significant time researching the best sustainable products and brands. This is a huge opportunity for businesses to capture consumer attention and loyalty through clear and honest communication.

• Sustainability is Not a Niche: The realization that sustainability is not just for a small segment of "green champions" but for the majority of consumers was a key "aha" moment. This consumer shift means that businesses can no longer afford to treat sustainability as a side initiative; it must be central to their strategy.

• Strategic Shifts, Not Just Products: The discussion around dismantling old, profitable business models in favor of sustainable, long-term strategies was another major takeaway. It’s not just about launching new products; it’s about transforming entire ecosystems.

• Surprising Demographic Findings: Contrary to popular belief, younger consumers are not necessarily more committed to sustainability than older generations. This was a surprising insight, showing that sustainability spans across age groups and income levels.

These insights provide a clear roadmap for businesses looking to succeed in sustainability and meet the growing consumer demand for green products. The session underscores the importance of both internal alignment and external consumer engagement in driving meaningful change.

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To go further: The Demand Revolution on LinkedIn

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Watch the full video:​​​