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Monday, June 26, 2017

More Than Half of Consumers Now Buy on Their Beliefs, 2017 Earned Brand Study Reveals

We get asked all the time:  Do  consumers really care about supporting sustainable products and companies?  How committed are they?  Will they pay more?

Do companies get a return on their investment in green?

This article, profiling shifts in consumer patterns, suggest, in fact, they do.  Very much.  Which is good news on all fronts.  It means the message is getting out, and is widespread.  It means we will see growth in the green economy and smart tech.  Renewables will flourish.  EV's and hybrids will become a bigger part of the car market.  R & D investments will support transformation, efficiency, and triple-bottom line commitments from the business community.

We hope you share this dedication to smart shopping.  It is clearly changing the world of commerce.

Fifty-seven percent of consumers around the world will buy or boycott a brand solely because of its position on a social or political issue, according to the 2017 Edelman Earned Brand study, with 30 percent saying that they make these belief-driven purchase decisions more than they did three years ago.

 The survey of 14,000 people in 14 countries not only illuminates a rising consumer expectation that brands will help solve societal problems, but also spotlights an enormous opportunity for brands that heed this call to gain new buyers and realize stronger consumer relationships more quickly.

Fifty percent of consumers worldwide consider themselves to be belief-driven buyers — and they mean business. Sixty-seven percent of them bought a brand for the first time because they agreed with its position on a controversial topic, while 65 percent will not buy a brand when it stays silent on an issue they feel it has an obligation to address. (The other 50 percent of consumers rarely buy on belief or punish a brand if it takes a stand on a controversial issue.)

 When a brand speaks out and belief-driven buyers agree with its stance, they will reward it greatly: 23 percent will pay at least a 25 percent premium; 48 percent will advocate for and defend the brand and criticize its competitors; and 51 percent will be loyal, buying the brand exclusively and more often.

“In a time of immense turmoil—fueled by a growing lack of trust in our institutions, intense ideological differences, and widening economic gaps —people are turning to brands as islands of stability,” said Richard Edelman, president and CEO of Edelman. “Consumers expect brands to lead the movement for change and address critical problems. The simple question that consumers are asking is: ‘Are you with me?’”

Belief-driven buyers also fall into a desirable demographic for many marketers: younger and higher-earning. The majority of Millennials buy on belief (60 percent), as do more than half of Gen Zers (53 percent) and Gen Xers (51 percent). In addition, the top quartile of earners over-index as belief-driven buyers (57 percent).

 Belief-driven buyers are most active in developing countries, such as China (73 percent) and India (65 percent), and they comprise around half of consumers in established markets such as France (50 percent) and the U.S. (47 percent); 66 percent of American Millennials buy on their beliefs.

At the core of the Earned Brand study is the Edelman Brand Relationship Index, which measures annually the overall strength of the consumer-brand relationship (Indifferent, Interested, Involved, Invested, Committed). In 2017, the global index is 37 out of 100, placing all consumers worldwide, on average, in the Involved stage. But the global index for belief-driven buyers is higher, at 46, placing them in the Invested stage and indicating that these buyers are already deeply connected to brands that support their causes and are more willing than the average consumer to buy first, stay loyal to, advocate for, and defend a brand.

“Belief-driven buyers will leave behind brands that fail to take a stand on issues they care about, but they will reward those that align with their views through increased spending and advocacy,” said Edelman. “This means there is a real possibility of consumer commitment well beyond the classic purchase funnel, because active partnership with a brand gets customers invested as advocates and loyalists.”

Belief-driven buyers expect a brand to not only speak out on an issue they care about (globally, the top-cited issues were immigration, gender equality, and environmental regulation) but also to ensure that the issue is authentic to the brand by addressing how it affects customers, product, employees, manufacturing, the brand’s physical environment and its core values.

 They expect a brand to commit money (70 percent), time (72 percent) and influence (68 percent) to the cause and express its beliefs through (in order of importance) employees, day-to-day business, sourcing, manufacturing and advertising.

The study also reveals that belief-driven buyers look to peer sources most often for reliable information about brands. Peer-driven conversations (89 percent) emerged as 20 points more credible than statements by a celebrity spokesperson (69 percent), and belief-driven buyers rely on conversations with friends and family (31 percent) more than advertising (21 percent) to learn about the actions that brands take.

“Brands that fail to answer the call of belief-driven buyers risk ending up in No Brand’s Land,” said Mark Renshaw, Global Chair of Brand at Edelman. “To win with these valuable customers, brands must fundamentally rethink their strategies and move beyond simply co-opting culture or stating their position to finding a true calling and acting on it. Brands that live their beliefs in all that they do, and invite consumers to take action with them, will be rewarded with more conversation, more conversion, and ultimately, more commitment.”

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