Do you know what the top driver is for a retailer to create social good? How about a manufacturer? Ketchum and Carol Cone On Purpose just released a report that will tell you that and more.
The study was published to start conversations between retailers and manufacturers about how to increase their return on social and environmental initiatives. The expectation is that they will see greater impact from their efforts if they collaborate. But first, retailers and manufacturers need to understand each other's perspectives. So, over 250 senior leaders at retailers and manufacturers took part in both a quantitative survey and qualitative interviews. They hailed from the U.S., Germany, U.K., China and South Korea.
Here are five highlights from the Ketchum Global Business "Return On Purpose" Study.
1. Purpose-driven initiatives are strategic business moves
It’s impressive how many retailers (94 percent) and manufacturers (98 percent) say social good initiatives are important to their company. They also predict social impact will become even more critical in the next two years (93 percent). That’s great, as it’s better for the planet and means higher job security for us.
2. The top CSR motivators are (drum roll, please) reputation enhancement, business results, and competitive advantage
Retailers and manufacturers say based on their experience these factors drive the integration of corporate social responsibility (CSR) into operations, products and services. Of course, retailers are looking to manufacturers to increase sustainability and social good in their products and process without decreasing profit. That makes it a little tricky.
3. Add human resource and legal department workers to impact initiatives
It’s pretty obvious that C-suite executives are the biggest influencers on sustainability efforts. What is less well know is: “The most effective organizations bring all their resources to the table in a cross-functional team to amplify and ignite their meaning. When they do, magic happens,” said Carol Cone, CEO of On Purpose.
Right now 70 percent of teams include executives, marketing, external relations and operations. Who’s missing? Human resources and legal departments. They need to be added to the team because they are essential for implementing social impact and mitigating reputational risk.
Also, the people who don’t work at your company are powerful — consumers. Yes, retailers perceive customers to be one of the top three influences. In particular, millennials and Gen Z are big players in the marketplace and conscientious about spending their dollars on sustainable products from ethical companies. Lastly, European and United States manufacturers say regulators and legislators are also a top influencer. Makes sense.
4. Measuring business results gets easier when retailers and manufacturers collaborate
Four in 10 retailers say that social good initiatives only make sense when a return on investment can be measured. However, around half (48 percent of manufacturers and 44 percent of retailers) say ROI is too hard to measure.
To improve efficiency and effectiveness, retailers and manufacturers can partner to define, prioritize and share metrics. Retailers rank customer satisfaction is the most important measurement (60 percent). Manufacturers cite operational efficiency and customer satisfaction as the top metric (66 percent).
5. The top barrier to integrating social impact is poor storytelling
If you want purpose to be integrated into every fiber of your company, you need to tell a powerful story. Communications, marketing and sales departments should be sharing your company's social innovation story with external audiences. Tell them what you’re doing, how it impacts them and why it’s valuable to the rest of the world.
Ketchum and Carol Cone On Purpose say they hope this research will encourage manufacturers and retailers to discuss ways to collaborate.
“This study really underscores the importance businesses attach to their impact on the environment and support of social initiatives,” said Monica Marshall, SVP and director of sustainability and social impact at Ketchum. When companies discuss these findings, she recommended they be transparent about any challenges and honestly say, “‘Yeah, we have it’ or ‘No, here are some gaps and what can we do to make it more sustainable? How can we collaborate?’”
Image (cropped) courtesy of Ketchum
Renee is a social impact strategist who works with companies to help them focus on key social and environmental opportunities. She loves connecting with people so feel free to contact her at email@example.com.