Why retailers are no longer afraid to engage in social responsibility

Gino Van Ossel - (c) RetailDetail

Increasingly, brands and retailers are willing to take a decisive stand: "Social responsibility is high on the agenda of managers, employees and consumers. There has been a structural change", Vlerick Business School's Gino Van Ossel thinks.

 

Common thread

The common theme at the upcoming RetailDetail Day is social engagement in the broad sense. Fashion chain C&A will elaborate on its new sustainability ambitions, Mars Food illustrates its inclusivity policy with the rebranding of Ben's Original, Colruyt Group outlines the consumer expectations concerning the Eco-Score, Zeeman ventures into the second-hand market, Dobbi wants to contribute to a circular textile industry, Foodmaker and Oats Day Long are going for healthy food options, ...

 

"There is a vast increase in moral responsibility among people", marketing professor and RetailDetail Day moderator Gino Van Ossel confirms. "For example, between the climate deniers and the dark green activists, there is a majority of people who do not know the details, but feel that something is happening." The recent floods and wildfires are no exception, but it also applies to topics such as Covid, road safety or health.

 

Three levels

"Look at yourself: do you feel differently about these issues now than you did five years ago? Most people will answer, 'in fact, I do'. Look at how many people use bicycles today for functional travel, such as commuting, compared to a few years ago. Or think about air travel: if one family member does not want to fly anymore, the rest of the family will forgo the aeroplane to go on holiday. The same thing happens with vegetarians: they decide what is put on the table."

 

In other words, things have changed structurally, and that can also be seen in the RetailDetail Day line-up. "For companies, this evolution manifests itself on three levels: the consumer, the employee and the (top) management. The interaction between those three is what puts it high up on the agenda", Van Ossel thinks. "Companies are thinking ahead. Managers do not want to be shamed and realise that they have to change gear to keep up with their employees and consumers. Think of the impact of Youth for Climate during pre-Covid times: it set up a comprehensive petition, co-signed by high-level CEOs, calling on the government to take action."

 

Inconsistent

Especially younger generations want to work for a company with which they can identify. Companies that cut corners will have more difficulty in the war for talent. Finally, there is the consumer. Here, you feel a 'slowly but surely' effect. "Consumers are not always consistent in their behaviour, but it is increasingly coming into play. When stores reopened after the lockdown, the longest queues were at Primark and Action. People may cycle to work, but still take the aeroplane to go on holiday. At the same time, you see many concepts that focus more on a form of corporate social responsibility, and they are successful. That much is undeniable."

 

There are brands that live off their ethical positioning - Tony's Chocolonely is a perfect example, but there may be no instant measurable effect for most brands. "However, they do feel that people find it important. At Colruyt, the lowest price is still paramount, but the Eco-Score is also important, and sales of broiler chicken that are raised extremely quickly, will be halted."

 

Making choices

Some brands take powerful positions, such as Nike or Mars Food. That sometimes causes polarisation, with consumers who are all for it and others who think it's 'woke nonsense'. How do you deal with that as a brand?

 

"You need to know your market: you can never please everyone. Nike knows very well who its customers are and how they think about things. In the United States, only 60  of the population is now non-Hispanic white. That is a fact: you cannot ignore the colour change in society. You have to make choices. Resistance is not only external, but also internal. At Nike, they must have had some serious debates about it."

 

No way back

"And then you see that some retailers have a historically different point of view. Companies like C&A and Colruyt have been working on sustainability for a long time, and it is part of their DNA for years. Ahold Delhaize started much later but is working on it in a structural, systematic way. It is not greenwashing, it is very high on the agenda.

 

Certain companies appeal more to specific target groups than others. Those companies can more easily surf that wave. At the same time, some companies dare to take more responsibility. "Shoe chain Torfs was one of the first in Belgium to allow headscarves at the tills. At first, the retailer faced some opposition, but in the meantime, that resistance has subsided. This change is irreversible. JBC recently launched a gender-neutral collection, and you notice that there are already far fewer negative reactions to it. You open the door for employees who otherwise would not be able to find you. I think there is no going back."

 

Financial logic

If you are too far ahead of the troops, you will always be a niche player, but a bit of a lead does not hurt, Van Ossel thinks. "At the time, some people said they would never visit Torfs again, but that will not have lasted long. When Renault in Vilvoorde closed down, people also said they would never buy a Renault car again. After a year, the sales figures were back at the same level. Or look at the introduction of halal products in supermarkets: in the beginning, people were very cautious about this because there was resistance. Today, all supermarkets do it, and there is no more mention of it. It all passes."

 

Finally, there is - undeniably - also an economic and financial logic behind this trend. "Listed companies are now also assigned a sustainability score, which determines whether financial institutions include that stake in their funds or not. Therefore, the score can have a direct impact on the share price and financing: less sustainable companies pay more for their loans. It is a knock-on effect; these things reinforce one other."

 

True networking

Also curious about how brands and retailers deal with social issues today? On 16 September, Gino Van Ossel will moderate a jam-packed programme at RetailDetail Day. The marketing conference for the retail industry will take place at RetailDetail's event location, in Shopping Stadsfeestzaal in Antwerp. 

 

It will be a hybrid event: 200 tickets will be available for participants who want to experience the congress Covid-safe and on-site to meet industry peers and experience some true networking. Others can follow the live stream remotely. You can find more information and tickets through this link.