Sourcing for Consumers Under 40: The Value of Corporate Social Responsibility
As generations shift, so do consumer expectations. To meet the ever-evolving needs of new generations of consumers, it’s important to understand what drives them to buy.
The Millennial generation (born between roughly 1981-1996) now makes up the largest generation of consumers, and Gen Z (born between roughly 1997-2012), is right on their heels. They’re also the most diverse, socially conscious, and digitally savvy generations yet.
When it comes to sourcing for consumers under 40, you cannot underestimate the value of corporate social responsibility (a focus on objectives like sustainability, ethical sourcing, and transparency). It is a vital aspect of reaching and building brand loyalty with today’s young consumers.
In this blog, we’ll examine the different aspects of corporate social responsibility and discuss how Flywheel Sourcing can help you reach your goals in this area.
What Is Corporate Social Responsibility (CSR)?
Corporate social responsibility, or CSR, describes a company’s contributions to the social and environmental wellbeing of the community around them, both locally and globally. The goal is to make a positive impact on the society in which they operate by incorporating elements of social and environmental accountability throughout all aspects of the business.
The concept itself isn’t necessarily new, but it’s one that has become increasingly important to younger generations of consumers. There are a number of elements of CSR, including:
Making eco-conscious choices
Promoting diversity, equality, and inclusion
Ensuring ethical labor practices
Making ethical business decisions
Giving back to the community
There are some regulations in place at the state, national, and even international levels for some of these concepts. But many companies are choosing to go beyond what’s legally required because they recognize that new generations of consumers are choosing to spend their money with businesses that prioritize CSR.
Sourcing for Consumers Under 40: What’s Important to Millennials and Gen Z?
A company’s CSR practices can be a huge differentiator in the global market. In fact, companies that embrace CSR are, in many cases, outperforming their competitors.
One 2020 study found that companies seen as having a strong positive impact on the world demonstrated 175% growth over the course of 12 years, while those viewed as having a low positive impact showed only 70% growth.
Consumers under 40 are especially likely to spend their money with and remain loyal to companies they perceive as being highly ethical. Another study showed that 94% of Millennials said they would buy from companies with strong CSR programs, and 84% would give those companies the benefit of the doubt in the event of a crisis.
It’s clear that CSR is a priority to today’s consumers. Let’s take a closer look at three aspects of CSR that are important to Millennials and Gen Z.
Social Responsibility and Ethical Sourcing
Millennial and Gen Z consumers are passionate about social responsibility and ethical sourcing, and are loyal to brands that share a commitment to these values. High on their list of priorities are brands that:
Advocate for ethical labor practices and human rights
Cultivate inclusive workplace cultures, and
Get their materials and products from ethical sources
This kind of social awareness is central to the lives of Millennials and Gen Z, who grew up connected to the world around them through the internet and social media.
With near-constant access to information (and to one another), this is the most connected generation yet. They know what’s going on in the world around them, and have a deep sense of commitment to helping others. They’re more likely than previous generations to look for companies who are making positive contributions to the world.
Environmental Considerations
Millennials and Gen Z are also more environmentally-conscious consumers than preceding generations were. Sustainability is on their minds when making purchasing decisions, and they may choose to forego products or brands that harm the planet or clash with their values in favor of those who prioritize sustainability.
In fact, 73% of both Gen Z and Millennials are willing to pay more for sustainable products. What’s more, 75% of Gen Z consumers consider sustainability to be more important than brand name when making purchasing decisions.
Needless to say, this is a significant priority for today’s youngest consumers.
Any steps you can take to reduce your carbon footprint and contribute to sustainability will both benefit the environment and help improve sales and brand loyalty among young consumers.
Brand Authenticity and Transparency
To draw in new generations of customers, it’s important to communicate clearly the ways your company addresses ethical manufacturing, social responsibility, and sustainability.
Millennial and Gen Z consumers look for authenticity and transparency in the brands they shop for and are more likely to support companies that openly communicate their values. In other words, they want to know what drives the companies they buy from.
And they have little tolerance for brands who talk the talk but don’t walk the walk. These tech-savvy consumers can quickly determine which brands are living up to their CSR claims and which aren’t.
Clearly communicating your CSR goals and routinely measuring and reporting on the impact of your initiatives can help build trust and brand loyalty with young shoppers.
Find Factories That Help You Reach Your CSR Goals With Flywheel Sourcing
At Flywheel Sourcing, we help our clients find the right factories for their needs. We can provide sourcing support to identify factories that are compliant with your customers’ needs and your CSR objectives. From factory pre-screening to continual auditing to ensure your expectations are maintained, we’ll support you every step of the way.
Contact us to discuss your sourcing support needs and how the team at Flywheel Sourcing can help.