So why wouldn’t you embrace all that psychology and behavioural science can do in your drive for improved sustainability?
Why is sustainability in retail important?
Sustainability in retail is important for a number of reasons.
First and foremost, sustainability supports the health and well-being of our planet. By increasing energy efficiency and investing in renewable energy sources, retailers can help to minimise their impact on the environment.
Furthermore, sustainability also helps to promote social responsibility. By reducing waste, minimising pollution, and developing green products, sustainability in retail fosters a more sustainable economy for future generations.
Ultimately, by recognising the importance of sustainability in retail today, we can help to ensure a bright and environmentally-friendly future for our communities and our world.
But how do we convey brands’ sustainability efforts and how to we get shoppers and consumers to change their shopping habits?
Sustainability issues in retail
Shoppers are increasingly being recognised as having limited desire for engaging in conscious rational deliberations with respect to most routine purchase decisions. After all, there are a lot of more pressing things we need to think about in our busy lives.
Instead, shoppers act more as creatures of habit, creatures for which automatic repeat purchases are triggered by situational cues and coloured by implicit emotional responses; think promotional displays and added value special offers.
Importantly, shoppers are also quick to conform to prevailing social norms and they often seek information not to illuminate and improve their understanding of a situation but rather to confirm their existing beliefs: Confirmation Bias
These embedded shopper and shopping related traits and habits need to be acknowledged, understood, and designed for in advance. For example, in product packaging, marketing communications and sustainability related initiatives.
Challenges in promoting sustainability in retail
Unfortunately, human nature stands as a potential challenge to the sustainability agenda, as any attempts to shift shoppers to more sustainable ways of thinking and behaving will need to overcome significant mental barriers.
As a result, rather than expend the extra effort needed to learn how to shop more sustainably, shoppers often just walk away and cling to familiar and more comfortable, even if fundamentally flawed, unsustainable alternatives.
Using behavioural science to encourage sustainable shoppers
Let’s focus on a number of cognitive biases and heuristics that brand managers and retailers can harness and use to their advantage.
Firstly, What is a cognitive bias?
Firstly, a cognitive bias is a type of mental shortcut that involves making judgements and decisions based on quick, intuitive judgments rather than more deliberate, reasoned thinking.
Cognitive biases are often rooted in our evolutionary history, as they helped our ancestors to interpret their environment without the need for intensive analysis or reflection.
While this kind of thinking may have been adaptive in the distant past, it can be problematic in modern society, where we are often confronted with complex issues that cannot be easily reduced to simple evaluative categories. Nevertheless, cognitive biases continue to shape our daily lives, shaping how we perceive people, events, and information around us.
The key to overcoming these biases is to cultivate greater awareness and understanding of them, so that we can approach problems with an open mind and a critical eye.
Secondly, what’s a heuristic?
Heuristics are mental shortcuts that allow shoppers to make judgments purchase decisions quickly and efficiently. They are mental strategies shorten decision-making time, reduce mental effort, and allow people to function without constantly stopping to think in detail about every item in their shopping trolley, basket, or cart.
Fortunately, these heuristics are very predictable. For example, shoppers tend to be risk averse in the short term, yet they severely discount the value of rewards in the longer term; Hyperbolic Discounting.
Changing the landscape of sustainable shopping through behavioural science initiatives
To cope with the tremendous amount of information that shoppers encounter in-store and online, our brains rely on mental strategies to simplify things so we don't have to spend endless amounts of time and energy analysing every detail.
Let’s take a deeper look at 4 ways brands can better influence consumers to make sustainable purchase decisions.
1. Hyperbolic Discounting
Hyperbolic discounting is a cognitive bias where people choose smaller, immediate rewards rather than larger, later rewards. To put it plainly, it is a cognitive bias that stems from impatience!
How does hyperbolic discounting affect purchase behaviour?
Shoppers prefer immediate rewards over delayed gratification. If you run any sort of free gift or instant reward scheme for a more sustainable brand, shout it from the rooftops - the hyperbolic discounting theory will have shoppers flocking to your brand.
While heuristics are helpful in many situations, they can also lead to cognitive biases. And it is these biases that we can use to encourage more sustainable shopping.
2. Availability Heuristic
The availability heuristic is a mental shortcut that relies on immediate examples that come to a shopper’s mind when evaluating a purchase decision. Shoppers make decisions based on what they remember - they mistakenly assume their memories are a representative sample of reality.
Endeavour to make any sustainable brand the most front of mind in category. Link it to consumption and link it emotionally too. When shoppers think of your category, they need to immediately think of your brand and draw upon Availability Heuristics, without having to get all ‘System 2’ about sustainability issues.
3. Confirmation bias
Here’s another well-known human imperfection. Confirmation bias is the tendency for the brain to value new information more if it supports existing ideas and beliefs. Once shoppers have formed a view, they embrace information that confirms that view while ignoring, or rejecting, information that casts doubt on it.
When it comes to working with confirmation bias in-store, there are a number of considerations and opportunities. For example:
- What’s the story? Identify what it is that shoppers want to hear about your category and make your sustainable brand the key owner of the most important attributes. Confirmation bias will set in and shoppers will be more likely to become consumers because they feel that the sustainable product meets their desires.
- Tell, tell and tell again! Repeated advertisements and product placements convince shoppers that a particular sustainable product is really good. When they go into a store and see it on a well-designed display, they are more likely to really want the item, even if it's something they don't really need.
- Remind shoppers. Play on confirmation bias as a means of reminding shoppers who buy your brand of the good choices they’ve made (positive affirmation).
In an increasingly competitive market, reducing friction is critical for retaining customers and outperforming your competition.
So, what is friction?
Friction is any activity that makes the purchasing process more mentally difficult than it needs to be. Every bit of friction gives shoppers and consumers one more reason to step away from your brand as they have to learn and adopt a new behaviour.
It is the opposite of something being intuitive and effortless. Simply put, friction is experienced when existing beliefs are violated, existing habits are made ineffectual, and expected rewards are denied.
By removing mental friction at every stage of the customer journey towards sustainable brand choices, you will achieve better brand performance. And yet only a minority of businesses are currently doing this, which leaves a huge opportunity for companies to improve their sustainable brand performance and gain a competitive advantage.
How do we remove friction?
Firstly, you need to understand the customer's psychological needs and desires, to identify what potential mental barriers exist between them and fulfilling those needs/desires through a more sustainable brand.
Companies need to make the more sustainable choices more customer-centric by providing convenience, consistency, and trust, all optimised from using behavioural science.
As a result, they will be rewarded with loyal customers who continue to purchase their products or services because they deliver what is expected at every touchpoint in the customer journey.
So, how can retail become more sustainability-focussed?
In this article, we’ve taken a tiny handful of well known cognitive biases, that are proven to strongly influence shopping behaviour. And what we’ve done is simply apply them to persuading shoppers to make more sustainable choices.
The aim is to demonstrate that encouraging more sustainable shopping may be easier than we think if we simply align the more sustainable purchase choices with the minds, forged by evolution, of more shoppers.
Adcock Solutions offer Behavioural Science insights and expertise that improves product visibility, appeal, engagement, and sales. We help put an end to spray and pray marketing and clients struggling to understand what customers really want.
Adcock Solutions have been improving the marketing communications of leading brands and retailers for 25 years.
Now we’re turning our attention to sustainability. So, if you have any questions, please drop us a line.