OPINION30 April 2024

Brands must bridge the solidarity gap to maintain growth

FMCG Media Opinion Retail Sustainability Trends UK

Nick Bull reflects on how brands can grow sustainably in a challenging environment. 

Two wooden figurines positioned on wooden blocks with a gap between them

Value dilemmas are a recurring theme across many different industries. From travel to technology, retail to energy, automotive and financial services and beyond, our discussions with clients consistently highlight this shared challenge.

  • “How can we defend our premium brands when people are shifting to private label?”
  • “How can we be fashion forward, while continuing to champion sustainability too?”
  • “How do we lead in sustainable travel for the next generation without looking hypocritical?”

These are just a few of the demanding questions echoing across various industries. Yet, there are undoubtedly many more questions left unasked in each sector.

Value dilemmas challenge brands to demonstrate their value proposition and relevance by addressing peoples’ diverse needs, preferences, and ethical considerations effectively.

Balancing priorities – like cost-effectiveness versus quality, environmental sustainability versus convenience, and traditional values versus innovation – highlights the complexity of consumer decision-making. This poses further challenges for sustainable brand growth when you throw in a standard-of-living crisis and economic uncertainty.

In this scenario, consumer behaviour shifts to value-conscious spending and changing brand loyalties. Reduced spending poses challenges in stimulating demand and maintaining sales growth, while heightened competition may lead to aggressive pricing, promotions and marketing, making it difficult for brands to sustain or gain market share.

Consumers face additional dilemmas as they balance factors such as price, quality, ethics, sustainability and personal values when choosing a brand. These conflicting considerations disrupt decision-making processes, complicating the selection process.

Furthermore, people question whether their favourite brands are worth the investment or if they can afford them altogether, while new brand choices also receive closer scrutiny. Are they worth the risk? Will they live up to expectations? This is leading to decision fatigue and wariness among consumers. Brand relationships are being tested like never before.

Bridging the solidarity gap

In this challenging environment, how can brands maintain sustainable growth and create lasting value for all stakeholders?

Brands must bridge the solidarity gap with consumers, empathising with their experiences and actively engaging in their struggles. While empathy is crucial for understanding, solidarity drives meaningful action and lasting change. To truly make a difference, brands must collaborate with customers to create a more just and equitable world.

There are several ways to achieve this. Brands may choose to focus on environmental sustainability, aiming to reduce their carbon footprint by adopting eco-friendly practices throughout their operations.

Examples include Patagonia, which stands out for its commitment to environmental and social responsibility, notably through initiatives to reduce water usage, minimise waste and use recycled materials. Its recent decision to eliminate corporate logos on products, to improve garment lifespan and resale value, aligns with its sustainable practices and customer trust-building efforts. Similarly, Ikea aims to reach circularity and climate positivity by 2030.

Toms has embraced the path of social responsibility as it promotes social responsibility, donating a pair of shoes for every pair sold, thereby fostering brand loyalty and societal wellbeing.

Similarly, brands that are honest by design, take action and are perceived as being bold and creating change will resonate with consumers who may have become disillusioned by inaction. Examples include Carrefour’s decision to put warnings on products facing shrinkflation until the targeted suppliers agreed to price cuts, while Tony’s Open Chain is an industry-driven initiative aimed at promoting transparency and accountability in the chocolate supply chain. Companies like Huel and Ben & Jerry’s have joined in support of this model.

Brand growth requires a holistic approach

Sustainable brand growth requires integrating environmental, social, and economic considerations into business strategies. Amid the global permacrisis, brands have a chance to step up. People, disappointed by institutional inertia, seek change. Brands must connect with customers amid cost-of-living crises and unrest, focusing on genuine values and needs. Key to this is implementing decision-making, based on data, to gain a deeper understanding of consumer behaviour.

This can be achieved by measuring and understanding brand health and brand growth, using integrated, mixed methodology and advanced analytics to help businesses identify patterns and trends in customer interactions, preferences and purchasing habits.

Granular understanding allows brands to better meet the needs and desires of their target audience, ultimately driving customer engagement, loyalty and growth. 

Nick Bull is partner, client strategy and development, Hall & Partners