In this episode of Women in Retail Talks, Shivika Sinha, director of digital marketing at Alex and Ani, shares her thoughts on why conscious consumerism is the future of retail, how retailers can pivot to a purpose-based marketing platform, and how millennials are changing consumers’ purchasing habits. Listen in below or read the Q&A!
Women in Retail Leadership Circle: I know you’re a social and eco-conscious business expert. Why don’t you tell our listeners what conscious consumerism is.
Shivika Sinha: Conscious consumerism occurs when customers decide to line their wallets with their values. In brief, it’s the application of personal economics towards goods and services that have a social and environmental impact trenched into their business model.
WIRLC: How did you become involved with conscious consumerism? Why did you choose that path?
SS: I’ve been deeply inspired by my family. My father spent the better part of three decades working with conscious capitalism and inclusive business models. I grew up in Nigeria, Zimbabwe, Vietnam, Bangladesh and India, and saw firsthand the impact of his work — the power of education and entrepreneurship in solving some of humanity’s biggest crises.
I feel we cannot rely on nonprofit parties and NGOs [non-governmental organizations] alone to fix the problem. Businesses must become part of the solution. His work was deeply influential in my life. I also wanted to be part of solving humanity’s biggest man-made problems. As I was scouring the University of Cambridge’s Centre for the Study of Existential Risk, which studies man-made problems, I was trying to identity which areas I could be part of the solution. There are some where I couldn’t help much, including AI [artificial intelligence] and biotechnology, but climate change is one that’s impacted by industry. And the two together — the inspiration from my childhood as well as knowing climate change can be a man-solved problem and how the retail industry contributes to it — inspired me to take up this cause and develop an expertise around social and eco-conscious businesses.
WIRLC: How does your work with Alex and Ani fit in with your mission?
SS: Alex and Ani embodies a lot of the values that I believe should be inherent in businesses, and hope to be adopted into practices worldwide. As you mentioned, we make all the jewelry from recycled and upcylced metals. The supply chain for production is transparent and made in the USA. The business has given more than $36 million back to causes via charitable partnerships. It also encourages its employees to volunteer via a volunteer time-off program. These values around engaging in civic responsibility, doing no harm to the environment and playing a role in solving humanity’s greatest crises is another reason why I joined Alex and Ani.
WIRLC: Let’s jump ahead and talk about millennials. How are they going to affect the future of retail?
SS: They’re going to have a huge impact on the future of retail, and business in general. Millennials are, as you mentioned, the most conscious set of consumers for a few reasons. One, digital media. This is a very digital-savvy segment of society. Digital media has allowed the access of information to occur at a faster rate than ever before, so they’re engaging in conversations around humanity’s biggest struggles, including inequality, poverty, climate change and so forth. As we’ve seen in the rise of digital activism, they’re incredibly engaged in social media around sharing their values and letting people know where they stand in the spectrum of those values.
They’re going to shape the future of buying because as this segment continues to be the most powerful buying segment they’re looking for brands and services that align with those values. So they’re not only looking for great customer service, experience and product, they’re looking to make an impact with their dollars. Nielsen reported that over 70 percent of millennials would be willing to pay more for goods and services that had a commitment to sustainability.
They’re also going to be the future of work. Deloitte’s 2015 Millennial Survey found that by 2025, millennials will account for about 75 percent of the workforce. Of those surveyed, 50 percent said that they would be willing to take a pay cut to align themselves with organizations that were doing good in this world. Millennials are truly the future of buying and branding and business and work.
WIRLC: For businesses that don’t have a social impact or sustainable business model, what are some quick wins to attack value-based customers?
SS: One of the quickest ways to pivot to sustainability and social impact is to align yourself with organizations that make an impact — e.g., charitable partnerships that make sense for the brand and business. There are many NGOs and charities that are looking to partner with big businesses to help their work, to provide funding but also as a way to get the word out. Also, opt for recycled materials or upcycled materials whenever possible, as well question and really look into transparency in your own supply chain. These are a couple of ways a business can easily pivot towards having an environmental and sustainable business model.
WIRLC: That dovetails into my next question: How does this affect the bottom line?
SS: Conscious consumerism is going to be the future of business, and it’s going to have an impact on the bottom line. Not only is environmental sustainability the right thing to do, but it’s also going to increase the bottom line. What we’re seeing is because millennials are so engaged in creating an impact with their purchases, they’ve fueled a trend that’s happening worldwide.
Nielson also reported that in a survey of online consumers in 60 countries, over half of them reported wanting to make a difference with their purchase. The impact in the bottom line cannot be understated. This type of conscious consumer impacts loyalty, they become advocates to a brand which increases lifetime value and, finally, they stay with a brand longer due to their loyalty. This decreases churn and reduces the acquisition rate required to acquire a new customer, which, again, makes marketing efforts more valuable, increases lifetime value, decreases churn and increases the impact on the bottom ROI significantly — all while doing good.
WIRLC: Would you agree conscious consumerism is a rising trend?
SS: Absolutely. I believe it’s a rising trend and is going to be a part of the future. And as I mentioned, a lot of the things that are often applied within authenticity in marketing apply to the conscious consumer as well. I would say this consumer is more, for a lack of a better word, easier to sniff out when a brand isn’t being authentic. The future of marketing is going to be around a conscious consumer and making sure a brand pivots towards sustainability and environmental impact.