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Our Insights 8 Nov 2011

A Business Plan for Seven Billion

By Caren Holzman

On October 31st the UN proclaimed that Earth’s seven-billionth inhabitant had arrived. Over eight million babies have been born since I wrote my previous blog on consumption. The figures are staggering. However, we know that the threat to the planet has less to do with the absolute number than with what, how and how much we consume. The challenge of how we meet the nutrition, health, shelter, apparel, energy, and entertainment needs of the next billion without further eroding the planet’s finite resources is surely among the most significant of our time.

In my last blog on consumption, I highlighted four trends:

  1. Companies are increasingly driving behaviour change of consumers
  2. Some companies are looking to sell less and repair and recycle more
  3. Collaborative consumption is a new model of consumption that could be scaleable
  4. The economy is not only changing consumption but also attitudes and habits

I discussed these initial findings with Gregory Unruh, author of Earth Inc. and with our Engaging Stakeholders network in a webinar earlier this fall, and together we discussed what else is needed. Here is what we agreed:

  • Guide your consumer. As our recent survey with GlobeScan indicated, a large majority feel that businesses have a duty to offer sustainable product lines instead of, rather than in addition to,unsustainable ones. We looked at leading efforts to choice edit OUT unsustainable products such as B&Q, who have phased out selling patio heaters in the UK, and efforts to choice edit IN sustainably such as 100% Fairtrade or Rainforest Alliance certified brand switches. We also discussed choice influencing – and a world where corporate advertising budgets were dedicated to driving sustainable consumption. What products, services and ideas should you promote and sell?
  • Influence beyond the transaction. Eighty-seven percent of respondents in our survey believe that businesses should educate consumers on benefits of more responsible consumption and, as Greg is quick to point out, 90% of environmental impact is in the consumer use phase. Levi’s is taking this issue head-on with its Care Tag, which advises the owner to wash less, wash in cold water, line dry and donate the jeans to Goodwill. What is your company doing above and beyond the transaction?
  • Look beyond your own business and think scale. Greg pointed out that APS, an energy company based in Arizona, needed to get closer to consumers to better understand how to deal with energy consumption. They needed to connect with companies such as builders and appliance makers to change energy usage and consumer behaviour. He also pointed to new innovations that become platforms for wider change. The plant-based bottle that Coca-Cola designed is now being used by Heinz. Who are your potential partners and collaborators and do you have a model to take your idea to scale?
  • Continue to defy the pressure of Wall Street and measure true costs. Our survey revealed experts are divided on whether there is an inherent conflict between economic growth and sustainable consumption. However, some of our Engaging Stakeholders network members believe as long as short-term profits and other Wall Street-driven drivers of success persist, companies will be challenged to address business model shifts linked to sustainable consumption. Unilever is a standout, as the company has stopped providing earnings guidance and quarterly profit updates to investors as it sets about implementation of its Sustainable Living Plan. We also give kudos to Puma for its ground-breaking environmental P&L to measure true costs. What measures are you willing to take?

Let’s get on with the above steps – addressing what we already know can make a difference. And let’s not get bogged down with the question of whether consumption in itself is or can be sustainable – in fact, I prefer the terms “creative” or “innovative” consumption, which diffuse this unhelpful debate and instead encourages us to consider how to sustainably and profitably meet the needs of our planet and our people – seven billion of them and counting.

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