The impact of a social responsibility image on sales

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Consumers are casting their votes on brands with their retail dollars, and for companies not making an effort to be socially responsible, it could mean finishing last in the financial polls, says Xan McNelly, senior vice president and director of account service for The Integer Group.

According to a Time magazine poll, 40 percent of adults said they purchased a product in 2009 because they liked the social or political values of the company that produced it.

“There is a new normal out there. It has really changed how people consider their purchases and what they are thinking about,” McNelly said. “Obviously they are scrutinizing their purchases in a different way; there is a different level of thrift than there has ever been before in terms of what people are willing to spend their money on, and they are holding brands accountable in a different way than they did in the past.”

McNelly said the change in the level of accountability consumers hold a brand to is likely because as the economy shifted for the worse, people started looking at what they were purchasing and considering what the true cost was of owning a product.

What could be even more worrisome is that consumer boycotts of products is a growing trend, and one that made Integer’s top-10 trends to watch list. According to a study by the Pew Research Center, 35 percent of Millennials, 34 percent of Gen X’ers and 36 percent of Baby Boomers said they had boycotted a company at retail in the past year.

McNelly said consumers feel that they have more control with their purchasing decisions because of the transparency that the Internet brings to brands.

“They can control their decisions in a more visible and vocal way, and they can do that online,” she said. “Through blogging or whatnot, they are essentially casting their vote against a brand with the statements they are able to make online and the followers they are able to accumulate against a brand if the brand is not acting in a way that is within the value set that they feel is important.”

McNelly focused on the Millennial generation, calling it a group with growing influence that cares deeply about socially responsible behavior by the companies from which they make purchases. And what’s more, they are well connected because of social media.

“(Millennials) are connected in a way that Boomers (aren’t); we are grasping on to the technology, but (Millennials) were raised with the technology,” she said.

McNelly said that a brand has to tell a story and that the social responsibility aspects of a brand need to align in a logical way with the brand, because if they don’t, consumers will see right through the effort.

“People are not going to believe it, and you are literally throwing money into the wind,” she said. “Because people are not going to look at that and go, ‘Oh, that makes me feel better about that brand.’ It is going to create confusion in the consumer’s mind.”

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