Marketing to the 99%

With the social unrest we are seeing all over Europe and the US, it seems to me that new consumer needs are arising. It’s not so much about physical needs anymore, but about intangible social needs corporations will need to address in the future.

These new “worries/needs” can not be satisfied within the current frameworks we know such as “social corporate responsibility”. Consumers are raising the bar further than the well-known “giving-back-to-the-community” or  “sustainability”. Consumers are demanding more, and corporations will have to act in different new ways that help consumer’s live with dignity. It’s about “social well-being and stability of our societies”. It is like if suddently, with the financial crisis consumers had come to realize that it is not only the problems in Africa or in other developing countries that matter, but also the problems at home that are making people lose their jobs and homes.

It is not a reaction against capitalism, but a reaction against greed, abuses and speculation. The feeling in the streets is that the wellbeing of a few can not jeopardize the wellbeing of the majority, and corporations will be asked to ADD REAL VALUE.

But what is exactly real value?

Satisfying consumer needs through a product and its well know 4Ps (product, price, place, promotion) is not sufficient anymore. Nor it is sufficient to take into account its sourcing, production and logistics. Consumers will be looking one step deeper into the value chain creation, they will be looking into the FINANCIALS, both as capital is poured into a company, and also as capital exits the company in the form of profits.

What can corporations do?

Let me start with the “capital output”.  In my opinion, expectations on how companies distribute their generated wealth will gain relevance in the future.

For instance, it is my belief that corporations will be expected to contribute to the taxation systems of their countries of origin. Off-shore structures and fiscal paradises could pose a thread and companies carrying out such practices could see consumers turning their backs on them in the future, as companies become unpatriotic, inmoral and socially irresponsible.

Other practices like further sharing profits with non-financial stakeholders could be seen as positive. Compensation schemes should therefore adapt to this new idiosyncrasy. Variable compensation or salary raises according to the company’s performance are good examples.

Furthermore, I could imagine consumers and stakeholders expecting companies to take the forgotten roles of states, for instance when it comes to massive layoffs. How can a company making thousands of millions of profits justify layoffs?

Note that these capital output measures do not necessarily have a negative impact on the overall competitiveness of companies. It is really a question of how to morally distribute profits.

When it comes to capital input, the source of the capital, its origins will gain relevance. Today big companies are controlled by big investments funds and financial institutions, always thirsty for profits and with a short term vision to maximize profit above anything else. In the future I could imagine consumers questioning the “identity of the driver”. Limiting the access of a company’s floating capital, for instance to individual investors or further incentivizing employee shareholder programs could be some of the solutions.

How to market these changes?

Still, it is legitimate for companies to capitalize on these changes. First of all however it seems to me there is a lot of “doing” to be done. Once this is done, sympathy for these companies and the companies image, will grow stronger and their products and services will be emotionally more appealing.

Finally, I could presume corporate branding will need to align with the new values/changes. Slogans like “good food, good life” (Nestlé), will take on a new dimension. I suspect the future of corporate branding will go in the direction of corporations being a good and responsible global citizen, from head to tail!