5 customer needs that will shape marketing in the circular economy
There’s no doubt that the circular economy is the best model for a sustainable economy yet. Not only has the European Union already invested € 10 Billion in public funding in circularity and will keep on doing so. Big brands like IKEA and adidas are hopping on as well, with both ambitious goals and real products.
Some of these products have circularity built right into them. So marketing can do marketing as usual: „Love our brand, crave our products. And by the way: buying them is OK for the planet, too.“ Candles made from renewable biomass as a sustainable alternative to palm oil are such a product: You buy them, you burn them. And you even feel good doing so. No special skills needed.
But a lot of products – and services – in the circular economy will need a different approach. Consumers will play a pivotal role in making their circularity work: by maintaining them, repairing them, upgrading them and returning them into the cycle at the end of life. Also, the role of consumers will change when they do not purchase products anymore but access them as services.
That’s why marketing for this changing economy also has to change. Our industry has become notoriously good at making people believe they will only be happy in life if they buy the latest gadget, discarding the old stuff. So how do we convince them that from now on actually taking care of stuff and using it as long as possible is “the new black”? And even more, how do we make them pay for it?
Sustainability is not a human need
Off course we all would wish that „living a sustainable life“ would be a desire that we can build our marketing on in the circular economy. The bad news: If that would work, we would not be in the mess we are in right now. People know about climate crisis. People know about their negative impact on the environment. People know about the alternatives. But as consumers, they do not act accordingly. Sustainability has proven not to be a desire, more a reassurance or sedation.
To come up with new and effective paradigms, we have to consider that people, products and the services they provide are different. So here are five needs of different target groups that can be addresses by different circular business models.
1. Familiarity
High quality, durable products have a long life cycle and low maintenance. They are the ultimate circular product. Not because they do not use virgin materials or are highly recyclable. But because they just last forever.
They also come at a high price. Marketing those products could address those rational benefits: “On the long run, this product will actually save you money.” or “This will probably be the last product you ever need to buy in this category”. But as we all know, we seldom purchase stuff just because of rational reasons.
That’s why emotionally, we need to address other desires. Such as familiarity, or even intimacy: The longer I use a product, the more I get to “master” it. The more features of a product I use, the longer I will use it, which is the main goal of circular experience design.
Mastery and expertise will also raise my social status, which is another basic desire of humans. In this sense, upgrading a product to extend its life cycle needs to be marketed as mastery, whereas just buying the next, more advanced product is kind of dumb.
This marketing strategy will work with casual conservative consumers, because they appreciate the uniqueness of products.
Australian Manufacturer of wallets Bellroy uses “familiarity” in their “older = better” campaign.
With more progressive target groups, personalizing a product will make them more attached to it. Especially when they do the personalization themselves.
Photo Credit: Roland Tännler
Freitag, the manufacturer of fashionable bags from used truck tarp, has integrated several of these concepts into a new service: In their “Sweat-Yourself-Shop” in Zürich, customers produce their own bag, which will be more intimate and familiar to them then any other product. It’s also a clever use of your customer’s workforce while making them pay for it.
2. Rituals
With hybrid products, that are not as durable as high quality products and therefor need maintenance, repairment and refurbishing, a different approach is needed. People have to take care of them. A tactic to market that is rituals. We hate nasty, recurring tasks. But we do love a good ritual, because it organizes our day and ads some routine to our life. The art is to make that ritual easy and joyful.
Regular maintenance for instance is essential for circular business models, and it can be turned into a ritual. Straws made from stainless steel as a sustainable alternative to plastic comes with such a ritual, and it even has it’s own neat physical form: A tiny brush. It’s cleverly included with a set of straws, because even if it’s just an accessory cross-financed by the straws, it makes people feel they paid for it. And we do want to use stuff that we paid for. That way, using that small little brush becomes an integrated part of the product experience – and a ritual.
Photo Credit: Ukonserve
3. Community
A growing number of business models in the circular economy are based on sharing products or just accessing the services they provide when needed. So “ownership” – which results in the positive feeling of power, status and convenience because of continuous access – is out of the marketing equation.
When marketing a shared service to a cost savvy target group, making them feel part of a “smart” community will be a good strategy. Smart communities do not only share stuff. They also share the responsibility and risk related to stuff. “Why own a mediocre product and feel mediocre, if you can access a great product whenever you need it and be part of a great community?”
I am not a big fan of the so called sharing economy originating from tech companies like UBER, as they are mostly about exploiting people and monetizing their data. Sharing apartments makes optimal use of space and thus makes sense ecologically. The alternative to AirBnB FairBnB.Coop shows that this can also be done in a fair way. Their marketing very much builds on “community” and the “commons”.
4. Ease of mind
Netflix and Spotify have introduced the idea of access instead of ownership to a broad audience. This especially is attractive to novelty seekers: Instead of owning what they already know, they get access to everything they can discover. And all that at a simple, transparent and affordable price: The flat rate.
Marketing in the circular economy can leverage that desire for “small adventures at a small price” and amplify it with “ease of mind”. This concept is the opposite of “familiarity” and “rituals”, as you do not need to be attached to a product or care for it at all. The service-provider takes care of that, doing a more effective job then you ever could.
Swapfiets, the acclaimed bike-as-a-service concept from the Netherlands, builds their marketing around that desire: You get a bike, and you keep it, in contrast to free floating bike sharing that makes you hunt for a bike every time you need one. And when it’s broken, the provider collects it for service and provides you with a replacement.
You will not find a single mentioning of “sustainability” or “circular economy” on their website. Because they do not have to. The circularity happens when bikes are designed, manufactured and collected, as the provider has an economical interest in making them repairable and reusable.
5. Hedonism
Marketing for sustainable products has neglected our human need for indulging ourselves for a long time. That’s why sustainability to most people equals sacrifice. Organic food was one of the first sustainable industries to change that, telling us “You do not need to buy the organic chicken for the sake of the chicken. It’s OK to buy it because it’s more delicious and healthier for you and your loved ones.” For the chicken that’s OK as well, as it does not care why it had a better life.
Hedonism can also be fun. The expectation of a sensation like “fun” is a strong desire with humans. And it’s also one of the least sensations connected to sustainability. Tesla is a good example of a sustainable alternative that is not marketed as “more sustainable” but as “more fun”.
Final remark: Does really no one desire a sustainable life style?
Off course they do: People having the privilege of writing and reading articles on circular economy – like me and you right now – actually have that desire. But we need to accept the fact that we live in a bubble. It’s actually a high impact bubble, as we are also the ones with the largest footprint and impact on the environment.
People less privileged do not care less for the environment. They actually have less impact because they own less stuff, travel less, produce less waste. But they also have less time to be educated on a sustainable lifestyle and circularity. Educating customers nevertheless is still a duty of brands and governments. But marketing – that helped creating the problem – has the potential to enforce that education, kick start circularity and become part of the solution.
