For the LOHAS customer, complexity is not a good reason for complacency. LOHAS customers believe major brands bear responsibility in driving sustainability among their suppliers and partners and must take steps to incentivize responsible behavior. This includes applying some of the same initiatives taken at the corporate level to the supply chain, such as insisting suppliers provide regular and formal reports on their sustainability efforts, requiring them to set clear, measurable sustainability goals, and identifying new processes and systems by which they can track metrics with their suppliers.
We’re beginning to see some progress in this area from brands like Unilever, which is leveraging blockchain technology to track supply chain sustainability and published a report on its sustainable sourcing efforts.
In time, as more large players come to demand meaningful and honest engagement from their suppliers in this area, the industry is likely to reach a critical mass, at which point sustainability will become the norm. But that will be the case only when major brands make it a requirement of doing business with their supply ecosystem. For the time being, the brands that are taking action are getting a share of the LOHAS’ customers’ dollars and loyalty, which will position them ahead of their competition.
Building trust and transparency, through words and action
With many brands making bold, but often unsubstantiated, sustainability claims, savvy LOHAS consumers may be skeptical about which brands are “walking the talk.”
To identify brands whose authenticity matches their ambition, LOHAS shoppers often rely on third-party certifications and reporting systems to see how their favorite brands stack up. One of the highest standards in this area is to be recognized as a Certified B Corporation, which is a formal certification program that verifies the performance, accountability and transparency of the business.
Digital is also providing ways for consumers to make better informed decisions. With apps like Buycott or Good On You growing in popularity, shoppers are now finding fast, reliable information at the point of purchase.
Leaders in the sustainability market will be the first to admit that consumer skepticism can actually be a positive force, in that it is driving transparency and accountability for brands — and creating new ways for companies to promote meaningful sustainability initiatives and differentiate from the competition.
Three actions consumer brands can take to attract the LOHAS shopper and create a more sustainable future
As our world continues to grapple with the urgent and widespread effects of climate change, most business leaders understand that sustainability isn’t a ploy to reach the LOHAS consumer, but rather a clear and compelling business objective.
Companies are investing in sustainability not just because consumers have become more discerning, but also because the financial health and longevity of the business depends on it. Circularity and carbon neutrality aren’t lofty future goals so much as requirements for doing business. Operating with transparency and authenticity isn’t just a way to satisfy customers, but also to attract the best and brightest talent to assure future business success. Soon, many of these concepts won’t be optional, but a matter of regulation, which means that companies that take steps to improve sustainability today will be well-prepared to operate in the landscape of tomorrow.
So, what actions can consumer brands take now to create a more sustainable future? Here we offer three recommendations for consumer products organizations to strengthen their sustainability agenda to win the hearts and minds of the LOHAS consumer, attract talent, build their brand reputation and satisfy the regulatory needs of the future:
1. Prepare a comprehensive sustainability report.
As consumers cast a more discerning eye on brands’ sustainability metrics, it is important to document a clear and honest snapshot of the company’s goals, progress and timeline using commonly accepted standards such as GRI, SASB, TCFD and CDP. With these metrics in hand, companies can also take steps to earn coveted accreditations and accolades that will help their brand stand out as an ethical and responsible choice in the market.
2. Build transparency and traceability across the supply chain through advanced data capabilities.
In many industries, one of the most important and elusive areas within the sustainability agenda has to do with improving visibility across the supply chain. For consumer brands, this includes tracking the cost and origin of raw materials, as well as wages paid to subcontractors, which are often cash-based transactions recorded manually by a supplier. To build transparency, leading organizations are embracing the creative and strategic application of technology to help capture and analyze data — and turn it into insights that will support the change agenda.
3. Think about regeneration.
Looking to the future, the step beyond sustainability is regeneration. That means that if companies today are focused on neutralizing their impact, then the goal of tomorrow will be to rebuild what has been lost or damaged. Forward-thinking brands should consider how they will help replenish the resources they use in communities around the world.
With the LOHAS market growing an estimated 10% each year and the effects of climate change becoming more visible with each passing day, brands have both an opportunity and an obligation to make sustainability a central part of their business. Those that put circularity, carbon neutrality and transparency at the heart of the business today, will likely be rewarded with a brighter, more resilient tomorrow.
Have questions about how to craft a sustainability agenda that improves the health of the business and meets the needs of the LOHAS consumer? Cognizant is here to help. Reach out to our experts today.
This article was written by Anca Novacovici Lunn, Senior Principal Sustainability Advisor, in Cognizant’s North America Sustainability Services Advisory.
To learn more, view our webinar “Innovation through the lens of sustainability.”