New guest post by Mark Dacanay, a digital marketing professional that has a keen interest in cloud based technology.
One of the basic principles of economics is that people respond to incentives. People buy food to sate hunger, refreshments to quench thirst, and utilities because we are not in the dark ages and I need the internet in my life.
But not all incentives are physical or tangible. Sometimes the best reward is the knowledge that you are doing something good or that your decision helped save the world, even just a little.
Apparently, this principle is more applicable to customer success than most people believe, especially in today’s market. With the Millennials growing up and ready to take over the market, their purchasing behavior will also affect how companies will be marketing themselves. In fact, they currently account for about $1 trillion of US total current spending.
And one of the factors that really defines the Millennial market is their stronger sense of social justice. In a study by Horizon Media’s Finger on the Pulse, they found that more than 80 percent of Millennials expect companies to make a public commitment to good citizenship. This shows how essential corporate social responsibility is to this generation.
So, what does this mean for businesses? Here are some observations:
Price is not everything
While optimizing price may get your company more revenue, it turns out that it is not the main purchasing factor for millennials. In a 2015 Nielsen Global Corporate Sustainability Report, they found that 73 percent of global millennials are actually willing to pay extra for products and services that are sustainable.
This shows that this generation is really putting a premium on social responsibility. Traditional marketing where savings is the main message is no longer as appealing as before. The logic is that for a few more bucks, you are getting the product or service that you want, and you are also able to contribute to something worthwhile.
There is a reason why TOMS sell a lot of shoes. Even if they do not have the best quality, their strong focus on corporate responsibility by using environmentally sound products and improving lives in different parts of the world, brings them large support from the global community.
Faking it won’t help
Upon knowledge of Millennials’ tendency to give importance to social responsibility, some company executives’ first reaction would be to fake it. That is not advisable as the Millennial generation is inherently cynical of large corporations. Besides, faking it would only bring the company more negative press once the truth is discovered. If you remember in 2015, Volkswagen admitted to rigging emission tests. This was after their “Isn’t it time for German Engineering?” marketing campaign that stressed environmental sustainability. It was a messy time involving executives giving contradictory statements and a large-scale vehicle recall. The company has since recovered some of its luster but from being one of the top-trusted car brands, VW became the car company that everyone will second-guess.
That is the opposite of true environment-friendly products and services. In fact, that is the reason why a lot of cloud-hosted services like RingCentral, Amity, and Office 365 are doing well. Aside from the savings advantage of requiring little to no capital investment, using cloud services allows new breeds of executives and entrepreneurs to adopt paperless operations and reduce their waste contribution because they no longer need to buy more hardware to use the service. Cloud services are inherently more environment-friendly without having to advertise it and that is why Millennials support it.
It’s about true sustainable social responsibility
As said, faking it would not help, but neither will half-hearted attempts at corporate social responsibility. Making a few donations to a few charities and paying lip service would not cut it. It is not just about doing charity work; as said above, Millennials care about sustainability. They are not after short-term good deeds; they like campaigns that want to make the world better not only in the present, but more importantly in the future. Instead of just making token donations, why not create a more concrete corporate social responsibility campaign that can either help more people long term or turn business operations into a more environment-friendly operation. While true corporate social responsibility campaigns can be costly, it does pay off. Not only is your company contributing to a better world, you are also helping your business attract the dominant market today: The Millennials.
Edited and prepared by Amy Murphy, Journalism student from DCU. originally published here : https://www.ringcentral.com/