Purpose over price – a peek into the values-based economy

Since the beginning of the pandemic, there has been a monumental shift in the way that people are choosing to spend their money. They are voting with their feet by buying products and services that are in line with their social and ecological values, rather than based on convenience or brand. In fact, not only are more people buying from purpose-led organisations, 55% of people are willing to pay more.

Consumers are re-evaluating the businesses they support, it is no longer about the product or service but ethos. People want to spend their money with organisations that invest in communities and contribute to both society and the environment in all aspects of their operations.

So what does this mean for business?

There is a growing consumer demand for transparency around organisational values and an expectation that these will not only be declared, but acted on. Today’s consumer believes that values should go beyond merely a department dedicated to corporate social responsibility, they should be reflected in everything the company say or do. This doesn’t just extend to how the organisation behaves, but how they choose to align with suppliers within their eco-system.

Yet, it isn’t as simple as just adopting a social or environmental cause, or aligning your organisation with like-minded businesses. It is a much more complex process of embedding the intention of creating a better world into the organisation’s culture and then genuinely putting those values into action. An authentic approach is the key, because today’s consumer is well informed and can quickly determine whether or not an organisation is genuine in their social and environmental efforts.

Governance, Social and Environmental (GSE) issues are rapidly gaining traction across the Australian business landscape and many organisations are realising in order to thrive in the emerging values-based economy, GSE needs to be integrated into all aspects of operations to meet consumer expectations and to remain competitive in an evolving market.

Many consulting firms are starting to include GSE advisory as a part of their offering, helping organisations to strategically transition to becoming more purpose-led with a focus on creating authentic social and environmental impact. This involves helping them to identify areas for improvement, shape the processes and procedures of the organisation as well as measure and report the social and environmental impacts they have achieved.

As we move to a more values-based economy, measuring and reporting these outcomes will become vital in convincing consumers that the company is genuine in their efforts to create positive social and environmental impact. It will be interesting to see over the next few years, how organisations will adapt and evolve to meet the demand of the ethical consumer.