The ethical retail experience – driving brand loyalty

Brands are built on customer experience. In today’s post-pandemic world, sustainability in retail has become an essential part of the overall customer experience. There’s another factor at play for brands wanting to win the hearts and minds of shoppers – and that’s being seen to play a part in solving ‘world problems’.

There’s a growing recognition that social and environmental issues cannot be solved by governments alone, and that commercial organisations have a significant role to play. Brands with a retail strategy that shows they are aware of their responsibilities, and are taking action to make the world a better place are driving greater engagement and loyalty. That, in turn, translates to a stronger brand and an increased bottom line.

In an independent study, four out of five people described themselves as likely to choose a brand with a positive approach to environmental sustainability.  Shoppers choose brands based on, for example, the quality of ingredients used (76%), the way employees are treated (65%) and reducing plastics and protecting the environment (62%).

In the world of fashion retail, a recent survey showed that the number of people who say sustainability in retail is an important factor when making a fashion purchase went up from 65% in October 2020 to 69% in May 2021. McKinsey research shows that in Europe, the focus on sustainability has deepened during the COVID-19 crisis, with consumers demanding environmentally sustainable behaviours from fashion brands. In their survey, 88% of respondents felt that reducing pollution in the fashion industry was a top priority.

‘Sustainability in retail,’ or the strength of feelings about social, ethical, and environmental performance, is a ‘walk-away’ factor, with nearly one-third of consumers indicating that they had stopped purchasing certain brands because of their ethical or sustainability credentials.

Many brands, of course, have a retail strategy that embeds sustainability into their business operation and practices – but this isn’t necessarily enough to win customer loyalty. Despite all the good work done by some brands, 45% of consumers remain unaware of brands’ sustainability practices.

A brand’s retail strategy must not only include sustainable and ethical practices, but must very clearly communicate this to consumers to ensure that its efforts are rewarded with enhanced brand perception and loyalty.

Retail technology can play an important part in ensuring that a brand’s sustainability approach is converted to business benefit. Flexible technology platforms with promotion types and loyalty programs are highly effective tools for brands wanting to spread the message about their ‘world problem solving’ credentials. Personalised promotion types can be used to get a targeted message to individual shoppers, direct to their mobile device. Promotions are engaging and capture the audience’s attention. They are an essential retail strategy in a campaign to raise awareness of a brand’s sustainability credentials.

If one of the aims of a ‘world problem solving’ approach is to increase brand loyalty, then a customer loyalty solution is essential for capturing and tracking that increased engagement. As brands win more customers, attracted by their ethical and sustainability stance, the loyalty program offers a personalised customer experience which keeps them engaged and turns loyalty into trackable increased sales.

Shoppers love to engage with their favourite brands – they buy more frequently and spend more each time. Brand loyalty is built on customer experience, and in today’s world, sustainability in retail and alignment of values is an essential element of that experience. For brands that can embrace social, ethical and environmental practices, and (crucially) tell the market about it, there is the glittering prize of increased customer loyalty – and profit.