A decade ago, only granola-crunchers wearing Earth shoes demanded environmentally friendly products. Today, droves of consumers are favoring businesses, products and services that are environmentally and socially conscious. Read on to find out how the LBEs industry can cash in on the trend.
Consumers are changing their buying habits toward a more sustainable lifestyle, both environmentally and socially. Businesses, including location-based leisure businesses, have an opportunity to take the lead within their industries and be the first to deliver and market around the idea that less, or smaller, can be more.
In fact, a report (pdf of report) released in July 2007 by Goldman Sachs, one of the world's leading investment banks, found that public companies that are considered leaders in implementing environmental, social and governance policies to create a competitive advantage have outperformed the general stock market by 25% since August 2005, and 72% of those companies outperformed their peers over the same period.
GfK Roper Consulting released its 2007 GfK Roper Green Gauge® study in August, finding the vast majority (87%) of consumers indicate they are seriously concerned about the environment. The four environmental issues weighing most heavily on Americans' minds are:
The study also found the majority of consumers say they consider a company's environmental practices when making key decisions, including:
Another survey conducted by the ClearVision Institute, Gallup, and Yale University found that an increasing number of Americans consider global warming to be an "important threat that calls for drastic action." "One of the most surprising findings was the growing sense of urgency," said Anthony Leiserowitz, principal investigator of the study and director of the Yale Project on Climate Change. "Nearly half of Americans now believe that global warming is either already having dangerous impacts on people around the world or will in the next 10 years - a 20%-point increase since 2004."
Generation Y, also known as Millenniums, who have grown up with increasing environmental awareness, will likely be the most demanding in this realm. They'll also be the most discriminating in choosing which businesses to frequent, based upon the business' sustainable practices.
A recent Maritz Research Retail Group poll of Gen-Y shoppers (18 to 30) entitled "Environmentally Friendly Retail Marketing: All Hype or Consumer Preference?" found that 50% of respondents said retailers' environmental policy and sustainability influenced their shopping behavior. When asked to describe their attitude toward a retailer's environmentally friendly positioning, 46% said they would shop more at a retailer if it was environmentally friendly. Also, 47% of respondents said they would be willing to pay more for environmentally friendly services, products or brands. Of this percentage, 77% cited "care about the environment" as the main reason for their willingness to pay more. Other reasons followed far behind in importance, including "it's the right thing to do" (21%) and "so that people know I'm environmentally aware" (2%). Maritz predicts that this trend will gain more momentum with consumers in the future.
Today, brands and businesses need to compete on who offers "less" in a way that means more to consumers. This is especially important for businesses that want to resonate with female consumers. As well as Gen-Y, it's women, the chief decision-makers in a household, who are most focused on doing business with environmentally and socially responsible companies.
The location-based entertainment industry still appears behind the eight ball on these issues, short of cause marketing to support not-for-profit organizations. It is a great opportunity, just waiting for some location-based entertainment business to move into the limelight and take on a true competitive advantage.