How brands can meet the expectations of socially responsible Gen Z shoppers
What does it mean to be a socially responsible brand?
Decades ago, companies ticked this box by donating a portion of profits to charities or engaging in cause marketing campaigns. Today, that’s simply not enough--and at worst, can be perceived as inauthentic. The brands that truly and authentically engage in social, environmental, and even political issues are those that win big with Gen Z consumers. And it’s becoming more important than ever.
The shift from check-writing philanthropy to truly purpose-driven corporate social responsibility has been a long time in the making. Driven by Millennials engaged in social causes they care about, more retailers have paused to examine their values, practices, and impact on society and the environment. Those that take concrete actions to advance progress by putting a social mission at the heart of their business have been rewarded handsomely, with consumers choosing responsible companies over others, and paying a premium for their products.
Gen Z is only accelerating this shift, and they’re keen at sniffing out companies that talk the talk but don’t walk the walk. This generation has grown up with an understanding of the impact companies have on society, and are adept at researching brands before they buy: nearly half of Gen Zers have educated themselves on the environmental aspects of the brands they consume.
While Millennials will opt not to patronize brands with business practices, values, or political viewpoints they disagree with, Gen Z takes things a step further. More than 75% of Gen Z will not only stop supporting brands they find unethical, but actively spread the word.
Put simply, Gen Z has higher expectations of the brands they buy from. As an activist generation, they want to live their values. What they buy (and thus share on social media) must reflect their beliefs, and because of this, Gen Z is three times more likely than all other generations to say the role of business is to serve communities and society at large.
Whether your brand has a clear social mission or is just starting on the journey, the following insights can help your organization meet the expectations of Gen Z shoppers.
1. Find your purpose
Milton Friedman said the purpose of a business is to turn a profit. Today, the world’s business leaders have declared that view outdated, and at worst, harmful to a business’s long-term growth. In 2019, the Business Roundtable redefined the purpose of a corporation to serve all stakeholders, including communities and employees, not just shareholders. Having a purpose is no longer a nice-to-have, but a mandate.
Defining your company’s purpose can be as simple as asking: Why were we founded? An athletics company was founded to give athletes the tools they need to perform. A clothing brand was founded to give buyers self-confidence and individuality. Find that germ of a purpose and align it with an authentic social issue. Using the same examples, that could be empowering youth athletes in underserved communities, and developing more sustainable (and fairly-produced) textiles used in apparel.
2. Examine practices
A retailer that supports diversity and inclusion through its marketing and consumer engagement better have a diverse and inclusive leadership team and company culture. Before taking a public stance or integrating social issues in external activities, ensure your house is in order. It may take time to reform company culture or audit your supply chain, but these are worthy investments.
If you haven’t already, define values that will guide your practices. Ensure those values align with why your company exists, who you hope to serve, how you operate, and what you offer to consumers and society beyond just products. And then, ensure those values are lived each and every day.
3. Talk about your journey
There’s an important step on the social responsibility journey that many companies leave out: Communicate about your progress. It’s okay to acknowledge what your company is doing wrong on the path to fixing it. Unlike previous generations, Gen Z is surprisingly forgiving of brands that address their missteps or areas for improvement. They would rather support brands that openly work towards bettering society than those that cover up failings.
Even Patagonia, the poster child for ethical and responsible companies, clearly explains the areas in which the company falls short by using environmentally-harmful materials in certain products. Patagonia then explains how they’re working to remedy shortcomings not only for their own betterment, but to help the apparel industry as a whole move forward.
4. Build community around your causes
Community is one of the defining factors of Gen Z, and they’re redefining what it means to come together in society. Sixty-six percent of Gen Z say communities are defined by causes and interests, not by socioeconomic factors. This applies to brands, too--Gen Z are more apt to be loyal to brands that bring diverse groups together via shared causes as opposed to retailers that market to specific demographics and try to “force” community building.
Rather, Gen Z wants to be equipped with the platforms and tools your brand offers to build their own communities and engage in the issues and causes that matter to them. Nearly half of Gen Zers want to participate in a brand’s social impact initiatives, and 56% want brands to provide them with resources to make a difference on their own.
5. Speak up on the issues that matter
Sixty-six percent of Gen Z say brands should be part of the political and social debates of today, including promoting progressive values and playing a meaningful role in society. But, remember that while words are important--Gen Zers say brands should focus on messaging related to honesty, equality, and freedom--actions are non-negotiable. Companies that claim a stance or take a position are expected to back that up with concrete actions that Gen Z can join them in.
Looking ahead: social responsibility post-2020
COVID-19, of course, has only heightened the need to be a socially responsible company. Throughout the pandemic, and now the Black Lives Matter movement, Gen Z has felt called to embrace their individuality and stand up for what they believe in. Nearly three-fourths say they intend to take actions that have a positive impact on their communities, and they expect companies to do the same.
Sixty percent say they will make an effort to buy more from businesses that took care of their workforces and positively affected society during the pandemic. Today and tomorrow, the role of a brand will continue to evolve to play a greater role in society--not only because Gen Z expects it, but because retailers have the power to make a real, lasting difference. That’s a purpose worth working towards.
