by: David Wigder
Carbon Trust (CT) predicts that by 2010, the UK consumer market will have reached a tipping point: Purchase decisions will take into account climate change impact and how companies are actively addressing it.
Like all tipping points, the shift will be marked by abrupt and rapid change in consumer behavior with potentially significant consequences for corporate profitability and brand value (see Climate Change in the UK Market – Part I: “Brand Value at Risk”).
According to CT, three factors must align for consumers to reach a tipping point on climate change. Specifically, consumers must:
· “Be concerned about climate change
· Make the link between environmental issues and their daily actions, and
· Modify their purchasing behavior to reflect their concerns about how companies are addressing the issue.”
CT offers analogies where similar tipping points have been reached on social and environmental issues: unleaded gasoline, dolphin-friendly tuna, and more recently, mass market organic foods. Tipping points such as these occur when consumers “both want to, and can, take action”. As such, there are two critical questions for today’s marketers to consider: Are similar dynamics in motion for climate change and, if so, when will they reach a tipping point?
If you were to make a prediction solely by examining the mindset of the average British consumer today, you would be hard pressed to conclude that a tipping point may be fast approaching. While 67% of British consumers claim that they know “a great deal” or “a fair amount” about climate change, there is little evidence to suggest that a substantial number of consumers have made a clear link between their own actions and the environmental consequences.
Nonetheless, CT identifies five factors in play that may accelerate these dynamics:
· Personal experiences (e.g. draught, perceived temperature shifts) make the issue more relevant and “provoke the strongest reaction” from consumers
· Exposure to media which enables consumers to better comprehend and “internalize” the message
· Leadership by other countries provides a road map for others to follow
· Supporting regulation which reinforces desired consumer behavior
· Realistic and available substitutes enable consumers to make other choices without changing consumption patterns
While CT projects such factors will accelerate the onset of a tipping point by 2010 in the UK market, do similar dynamics exist in the US? It could be argued that such dynamics may be emerging:
- Though a more-mild-than-anticipated hurricane season defied forecasts this year, heat waves, droughts and continuing recovery from Katrina will keep the potential consequences of climate change fresh in consumers minds
- Exposure to climate change issues is increasing, and is becoming more ingrained in our mass culture (keep an eye on An Inconvenient Truth at Oscar time). This will only be reinforced next year as a massive awareness campaign spearheaded by Al Gore is set to launch in early spring.
- Given the political climate in Washington, at least until this month, leadership on climate issues has emerged from states such as California or New York (both, incidentally, led by Republicans). These states have passed bills that cap carbon emissions or mandate use of renewable energy.
- Substitutes are emerging: Green energy is becoming more cost competitive and hybrid vehicles are being rolled out in conventional styles.
While the US consumer market may still lag behind the markets in Europe and Japan, seeds continue to be planted that will inevitably move US consumers closer to the tipping point. Marketers should take note.
Original Post: http://marketinggreen.wordpress.com/2006/11/18/climate-change-in-the-uk-market-part-ii-consumer-tipping-point/
