Consumer shopping behavior has radically changed. Consumers are increasingly embracing social causes; they now seek brands and products that align with their values. Businesses should position technology at the core of sustainability initiatives, empower employees and educate consumers to deeply embed sustainability, and collaborate with the broader ecosystem.
With the advent of social media and mobile technology, consumer behavior and preferences have significantly shifted. Today’s consumers come highly informed, with distinct demands related to price, production methods, delivery options, and much more.
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According to a Capgemini Research Institute report, sustainability has risen up the customer’s agenda – 79% of consumers are shifting their purchase preferences based on inclusiveness, social responsibility, or environmental impact. Furthermore, COVID-19 has significantly increased consumer awareness to buying sustainably – 65% of the consumers said they would be more conscious of the impact of their overall consumption in the new normal. Therefore it’s no surprise that there has been an increase in brands implementing sustainability practices to the forefront of their marketing strategies and business plans.
Most organizations accelerated their digital transformation initiatives in 2020. However, not many leaders have managed to create a sustainable digital enterprise.
According to experts, businesses that invest in sustainability usually find that better operational performance, improved resilience, and business success follow. This principle held true especially in the face of the coronavirus pandemic as sustainable indices outperformed their parent benchmarks.
Companies need to align their sustainability and digital transformation objectives to meet customer expectations, and their decisions should be grounded in data.
Data and Sustainability
The rapid digitalization driven by COVID-19 has forced businesses to rethink their decisions, especially on how to apply technology in new and meaningful ways. Significant opportunity exists for businesses that can capture the value of data to power more sustainable solutions. For instance, as per a McKinsey report, the value unlocked by AI in helping design out waste in a circular economy for food, keeping materials and products in use, and regenerating natural systems, could be up to $127 billion per year in 2030.
Today’s digital transformations need to be purpose-led, delivering for all stakeholders as a necessity for company success.
So, let’s look at a few ways companies can set themselves on a path to success in digitalizing any business using purpose.
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Product-as-a-Service Model
In many cases, including environmental factors in the decision-making process can lead to a re-assessment of the company’s business models. For instance, leasing and product-as-a-service models are on the rise, integrating data from users and products to improve resource and asset utilization via intelligent provisioning and operational enhancements.
Consumers today are increasingly shifting away from buying and operating IT equipment and instead consuming it as a service. This helps eliminate the overprovisioning of IT, thereby reducing both the environmental footprint and capital expenditures.
Reducing Environmental Impact
It is crucial to optimize environmental impacts within operations, but its positive impact will be hampered if these measures are not taken throughout the entire supply chain. Today, technology helps people stay connected with each other, systems, and things along the way. The use of the tracking and data-sharing platforms provides both accountability and visibility in real-time, reducing environmental impacts before they are magnified.
Integrating Sustainability Considerations
Increasingly, consumers want the brands they use to focus on sustainable issues. The employees and prospective employees too want that from their companies. In fact, the ability to attract and retain talent, specifically the younger generations, is tied to an organization’s performance pertaining to sustainability and purpose-centric initiatives.
Business leaders must include sustainability as a strategic imperative throughout their organizations in order to remain competitive and resilient. Laggards in this area will suffer from talent shortages, leading to lackluster digital transformation results.
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