The ‘New Value System’ Shaping Consumer Spending And What It Could Mean for Your Business

A groundswell of ethically motivated consumerism is poised to redefine the business landscape in new ways and potentially create new opportunities for businesses large and small with an eye toward social entrepreneurship.

Conscious capitalism, like buying products from minority-owned brands and supporting companies with eco-friendly practices, is nothing new.

But as the pandemic has turned consumers’ quest for wellness into an imperative, health and well-being are now intrinsically linked to socially responsible purchasing like never before.

The shift has birthed a “new value system” for consumers who are increasingly voting with their dollars for brands that reflect their beliefs and sensibilities — while delivering products and services that address their personal and public health concerns, too, said Emma Chiu, global director of futurism and innovation think tank Wunderman Thompson Intelligence.

The convergence of conscious capitalism and holistic health, from physical fitness to financial fitness, is now starting to taking shape in the consumer economy, from an app that helps brands like Starbucks reduce their carbon footprint to indoor malls transformed into open-air markets designed for social distancing, Chiu told CO—.

That comes as health goals and concerns increasingly dictate what we buy and why we buy it. According to WSL Strategic Retail’s How America Shops study, 73% of the U.S. population said it was engaged in some form of living well, from healthier eating and meditation to stress reduction and fitness. [For a deep dive into how COVID-19 is reshaping the wellness sector, read CO—’s feature here.]

The ‘new value system:’ Ranking brands according to ‘what’s important to people’

The amped-up quest for health and wellness goes hand in hand with the new value system that’s emerging, Chiu said.

“There’s a shift in what is important to people when it comes to personal purpose, and these needs are impacting expectations from companies, creating a new value system,” she said. “[Consumers] want companies to address social and political issues as well as move into philanthropy.”

In turn, people will soon look to “shop by values” as a distinct category, to know “what they purchase is ethically made, sustainable and contributes positively to the planet.”

Businesses are heeding the call in a variety of ways:

• Chiu noted the just-launched Transform to Net Zero initiative, a roadmap to help all businesses quicken the transition to a net zero global economy. Spearheaded by Microsoft and led by nine businesses ranging from Nike and Unilever to Starbucks, the push includes a sustainability calculator that enables brands to monitor the carbon impact of their services and products, with the ultimate goal of reaching a net zero carbon footprint.
• Meanwhile, “a number of credit cards were released measuring people’s spending in relationship to sustainability creds,” Chiu said. Doconomy’s Do Black credit card, for one, tracks the carbon footprint of each purchase and will cap the user’s spend if they reach a certain monthly limit.
• U.K.-based website Did They Help? debuted amid COVID-19 to hold companies and public figures accountable for helping — or not — during the pandemic, Chiu said, noting that the site became very popular. The site also tracks brands as “heroes” and “zeroes” according to their response to the Black Lives Matter Movement and LGBT rights.

The business of health — from personal to planetary — will touch all industries

Health, Chiu says, “is becoming part of every single business out there across all industries. Not only the health of people but our planet.” Be it buzzy disruptors or big legacy businesses, “health will be at our every touchpoint as all industries integrate the business of health.”

AeBeZe Labs is one such business. The San Francisco-based startup is designed to help people embark on a digital detox and establish “healthy digital habits,” she said.

Among established legacy brands, luxury conglomerate LVMH, like many businesses in the fashion and beauty sector, pivoted production to make products for healthcare authorities. “An initiative which back in mid-March started off as switching cosmetic and perfume production to create hand sanitizers in France, has now turned into a global initiative, #LVMHjoinforces, with health authorities,” Chiu said. The move might signal a broader push into health. “I wouldn’t be surprised if LVMH ended up creating a healthcare products division from this,” she said.

The internet’s game-changing influence on business gave rise in the 2000s to the role of chief digital officer. Now as health plays a greater role across industry sectors, Chiu wondered, “Will the future of every company need a chief health officer?”

Businesses will step in to ‘save the next generation’

The educational disruption and economic havoc wrought by the pandemic has dealt a harsh blow to young people with long-term consequences, Chiu said.

“Education is under a lot of stress and scrutiny for not being able to pivot, and moving online is not an easy solution as many [students] do not have the resources,” Chiu said.

Research reveals that kids are under “toxic stress” from not going into school, just as billions of dollars are required to rehabilitate the U.S. education system, which threatens to jeopardize the next generation and “rob them of crucial learning time,” she said.

At the same time, “unemployment during the pandemic hit the youngest generation hardest,” as many 2020 graduates opted to take a “coronavirus gap year,” Chiu said.

The perfect storm of factors threatens to exact a brain drain on the business community. “This is essentially stopping the next generation of workers, innovators, entrepreneurs,” Chiu said.

Businesses are in a position to step in and help fix the damage — which is also in their own best interest, she said. The business community will invest in “how to save education and the next generation, and as a result save future businesses.”

Chiu pointed to a new jobs council tailored to low-income minority students that’s looking to do just that, promising to leverage the capital might of Fortune 500 companies to help groom tomorrow’s executives.

The New York Jobs CEO Council set plans to work with universities, cities and businesses such as Mastercard and Verizon in a bid to “prepare a new generation of New Yorkers for high-paying jobs at some of the country’s biggest companies,” she said.

‘The outdoor reform’: Looking to exterior spaces to keep people — and profits — healthy

Amid the health dangers of population density and interiors posed by the coronavirus, companies are pivoting to outdoor spaces to drive business more safely.

“As the world questions the future of skyscrapers and indoor spaces, one area many industries and government are looking to maximize on are outdoor urban spaces,” Chiu said. “Schools, restaurants, retailers, museums and even libraries around the world are turning to the great outdoors to fuel the economy and continue business safely.” She said. “Over the years, the focus has been to bring the outdoors in. Now the reverse is happening and new experiences will be looking to bring the indoors out.”

• For example, retail destination One Paseo in San Diego reinvented itself as One Paseo Al Fresco, offering outdoor retail, workouts, dining and more, and Westfield Valley Fair in California created an open-air market after reclosing its indoor mall, she said.
• San Francisco’s Economic Recovery Task Force has introduced a new program allowing businesses to operate in parts of outdoor public spaces.
• And across the country at New York Public Library’s Stavros Niarchos Foundation Library, which reopened in July after three years of renovation, now includes a free public rooftop space, “billed as the first for the city,” Chiu said.

While you won’t see businesses in masse commit to outdoor spaces immediately, Chiu said, in time, “I definitely see this being a big opportunity.”

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