How do Consumers React to Environmental, Social and Health Positioning in the Food Industry?

Major Research Questions:

1.     What environmental and social messaging resonates best with consumers?

   Does consumer behavior toward green products change depending on whether product consumption is conspicuous or private?  If a difference does exist, how does this behavior change?

I am a sucker for social and environmental positioning.  Throw a Fair Trade label on a box of tea or bag of coffee and I’m sold.  Heck, I spent a year of my life helping farmers get Fair Trade certifications.  Needless to say, I fall under the “Greenest Americans” minority in Joel Makower’s “American Environmental Worldview” bell curve.  Unquestionably, environmental and social marketing works well if I am the target.  Since I am such a fan of this new wave of marketing, I am really interested in trying to remove my personal biases and look at how the American consumer base is reacting to this nontraditional marketing. 

I am choosing to concentrate on the food sector because this industry is riddled with impulse buying decisions.  Food purchases are relatively inexpensive, so customers spend less time researching and preparing for the buying process.  Further, customers usually do not engage in a long deliberation period at the point of purchase.  Habit and price are assumed to dominate purchasing decisions in this space, but the proliferation of alternatively positioned products and the rise of retail concepts such as Whole Foods Market suggest that other factors are influencing buying decisions.   I want to get at the heart of what is turning impulse buying green.

In this research report, I am operating under the assumption that some key words related to environmental and social product attributes are more effective in influencing consumers’ decisions than are others.  At this point, I am still uncertain as to which phrases are the most effective.  My assumption is that this will differ by target segment.  Here is an initial list of the terms that I wish to consider:

Health: natural, organic, no GMOs, % organic, vegan, no bioengineered ingredients

Social: Fair Trade certified, % fair trade, ethically sourced, fairly traded, locally grown, local, vegan, Girl Scout, % profits to nonprofit

Environmental: Rain Forest certified, organic, % organic, % profits to nonprofit

Health: natural, organic, no GMOs, % organic, vegan, no bioengineered ingredients(This study will not look at consumers’ reactions to the traditional health claims, such a “zero trans fat” or “low in carbs”, but rather will consider health claims related to lack of chemicals or artificial ingredients.)

Clearly, there is some overlap as to which words fit under each category, but I think that this may lead to one of the most interesting components of the research.  I tend to associate the term “organic” with both beneficial health and environmental connotations, but am unclear as to how most Americans would react to this word.  Understanding how these words resonate with consumers will be extremely important for green marketers crafting marketing communication.  I threw in the term “Girl Scouts” in attempt to get at consumers’ reactions to social positioning before it was a hot topic.  Whether the Girl Scouts knew it or not, they were way before their time.  I am curious to see the difference in consumers’ responses to Girl Scout cookies versus Fair Trade bananas.  At first blush, these products seem light years away from one another, but I have a feeling that they may share a common thread in positioning.

The second piece of this research will look at whether individuals’ consumption environment influences green purchasing decisions.  With this, I am really trying to figure out whether people that order a Venti Fair Trade Coffee with Soy Milk at Starbucks buy Folders and whole milk for their homes.  My guess is that social pressure and lifestyle aspiration may increase the demand for environmental and socially positioned products in public environments, hence the rise of Starbucks and Chipotle.  In supermarkets, where social pressure is less prevalent, customers may retreat to cheaper options that they can enjoy in the privacy of their own home.  However, only research will have the answer.

I plan to use Joel Makower’s book, “Strategies for a Green Economy” as a resource for my report.  I will also read Makower’s blog as a means of gathering information.  Makower’s work will be particularly useful since he is viewed as a leading thinker in green business.  Any more reference or research suggestions are welcomed and appreciated.

True of False? "The Customer is Always Right"

This week I did some reading on marketing research that was particularly valuable. The articles that I read, “Turn Customer Input into Innovation” by Anthony Ulwick, “Metaphorically Speaking” by Gerald Zaltman and “Kenna’s Dilemma” by Malcolm Gladwell; all challenge the notion that the “customer is always right”.  Maybe I am biased from the countless summers that I spent working in the restaurant business while in school, but I took issue with this notion as it was first introduced.

            I began with Gladwell’s article, which made for an ideal starting point since it was replete with examples of how customers have led marketing executives astray.  I must admit; I have a lot more respect for Coke after hearing about the extensive customer taste testing and research that went into the launch of the “New Coke”.  Prior to reading this article, I would have considered that launch one of the most ill advised new product releases in history.  However, Gladwell changed my mind as he described the panic of Coke marketers as customers repeatedly picked Pepsi over Coke in blind taste tests as their competitor continued to gain market share.  I now empathize with those who believed something had to be done. 

The moral of the Coke story hit me hard and I believe that it is a lesson to all of us involved in customer insights.  What customers say and do may not always be aligned.  While New Coke prevailed in blind test tastes by impressive margins, it was a complete failure in the market.  The reality is baffling until completely digesting Gladwell’s maxim: “Customers do not consume beverages blindly.”  This insight is invaluable in new product development.  In order to understand how customers truly feel about a product, marketers must simulate as natural of a trial experience as possible.  People must me permitted to bring the product into their homes and integrate it into the course of their loves in order to evaluate it properly.  I find this thesis particularly compelling and will attempt to keep this concept in the back of my mind, as I imagine that I would regret the day that I forget the lessons from Coke.

While Gladwell’s argument for simulating reality in product trials resonated well with me, I was less convinced by Zaltman’s case for greater customer abstraction.  After some convincing by Gladwell, I was able to buy into Zaltman’s assumption that consumers have a difficult time articulating what they truly want or need.  I was right there with him as he posited that most social communication is nonverbal as well.  His argument fell apart for me when he suggested that having interviewees make a photomontage of a research topic would allow researchers to tap into consumers’ deeper thought processes.  In my opinion, it is dangerous to assume that individuals will spend six hours thinking about this assignment prior to the marketing interview.  Further, I would expect that individuals would be frustrated as they search for relevant images to no avail.  One’s propensity for creativity must certainly affect the quality of the materials produced in the process.  While there may be some value in moving the customer toward a more abstract way of thinking, my limited time and budget as a marketer will be spent exploring the product usage process more deeply.

I was drawn to Ulwick’s article since he takes particularly outcome-oriented approach toward market research.  Ulwick recognizes customers’ adeptness in highlighting small improvements or missing features for existing products, but posits that customers are not able to stretch much further to give game changing insight.  Ulwick is probably accurate in this assessment.  Intuitively, it seems reasonable that customers will not know that they want something that does not already exist.   Nevertheless, customers are aware of the results that they want from a certain product, whether it be greater comfort, increased ease of use, better accuracy, etc.  Rather than asking customers what features they want to achieve these goals, it seems logical to leave the product design up to professionals that are aware of the product attributes that are most likely to achieve the desired results.

Overall, these articles won me over with the argument that the customer is not always right, or at least not in the papal, infallible sense of the expression.  Customers know what they like and don’t like, but may not always be able to properly articulate what aspects of the product lead them to making that evaluation.  That is where experts must fill the void in designing and assessing products.  Customer involvement in the development process remains critical, but the generally accepted way that marketers interpret customer insights must be modified in order to create truly innovative product offerings.