Doing Well By Doing Good

By Rieva Lesonsky

Given the general nastiness dominating the news in this election season, I needed a break and went in search of good news. Happily I found it: At the end of last year, Mintel research revealed that 56 percent of American consumers actually stop buying from businesses they think are unethical.

Incredibly, 35 percent of consumers do this even when there is no substitute product available, and 63 percent believe ethical issues are becoming more important. About one-third of consumers will tell others about a brand they perceive to be acting ethically, and another 29 percent will spread the good word on social media.

Unfortunately, only 45 percent of consumers buy products from businesses they believe to be ethical—despite the fact that 58 percent of them reveal buying ethically produced products makes them feel good. This disconnect seems to be driven by skepticism. According to Mintel, 52 percent of consumers think marketing products as “ethical” is a way companies manipulate consumers, while 49 percent believe many companies behave ethically in one area while behaving unethically in another.

Beyond this mistrust, many consumers are just plain confused by businesses trying to show their products are socially conscious. Mintel says their research shows 68 percent of Americans are puzzled by what ethical icons on product packaging means and 46 percent feel the same way about ethical terms. For example only 10 percent of consumers knew what the icons for Fair Trade USA and Cruelty Free International meant.

Instead of using icons most Americans can’t identify, Lauren Bonetto, Lifestyles and Leisure Analyst at Mintel, says businesses should “consider alternative methods to showcase their ethical efforts, such as content marketing showing the full scope of a brand’s actions and participating in related grassroots efforts.”

In good news for entrepreneurs, Mintel’s North America 2016 Consumer Trends shows that many consumers would rather shop at small businesses. In fact, 49 percent “trust small companies to do the right thing.” Consumers are judging you based how you treat your employees (48 percent), where your products are made (34 percent) and if your products are environmentally friendly (33 percent).