Chapter Two: Clothes and How to Nudge Consumers to Buy Sustainably
Overview of the Episode
Episode 2 of the podcast focuses on the textile industry. Fashion represents 10% of the world’s greenhouse gas emissions and uses about 20% of our annual freshwater consumption (Ro, 2020). To better understand what the industry is doing to improve its climate footprint, I interviewed Kutay Saritosun, Head of Marketing and Communication at BlueSign Technologies. Mr. Saritosun has a career in the textile industry, often focusing on sustainability. BlueSign is working with brands such as Patagonia and Adidas to improve the sustainability of their textile supply chains. For example, by reducing the need for harmful chemicals and decreasing water use. We also discuss how consumers can make active decisions to buy sustainably and how gen z is increasingly demanding brands to emit fewer greenhouse gases.
How Fashion Brands can use Nudge Consumers to Buy More Sustainable
As Mr. Saritosun mentions, it is vital that fashion brands clearly explain how their products are sustainable, for example, by providing information on the production process of each product. It is also essential that brands align their sustainability communication with their brand; otherwise, consumers will “see through” the marketing. When brands have products that emit fewer greenhouse gases, they are often priced higher to make up for, for example, organic cotton. Then, the brands can use a behavioral economic tool: nudge. In this chapter, I will evaluate how brands can use the concept of a nudge to convey consumers to purchase more sustainably and pay the green premium.
Nudges are “any aspect of the choice architecture that alters people’s behavior predictably without forbidding any options or significantly changing their economic incentives” (Hankammer et al., 2021). The definition highlights that nudges should not restrict actions but guide people’s attention by using choice architecture. For the sake of choosing more sustainable, a subconcept is called “green nudges,” of which there are three types:
- Simplifying product information of making specific product characteristics more salient to activate green behavior
- Integrating peer comparisons or status competitions
- Exploit passive choice with purposefully set defaults (Schubert, 2017).
In other words, nudges alter the information to make consumers’ choices feel more natural. For them to be effective, three elements should converge simultaneously for a behavior to occur: prompt, ability, and motivation. When a behavior does not happen, at least one of the elements is missing (Figure 1; Wintermeier, 2020). According to the Fogg Model, a nudge is only successful when the individual is motivated and able to complete a task and has a trigger to cue the behavior. To put that into practice, consider the uses of nudge below.
Nudges are small but can significantly impact critical metrics for businesses: sign-ups, conversions, and customer loyalty. However, in a rush to nudge online consumer behavior, marketers sometimes use product badge nudges in a harmful way. An example of this is “must go”-signs (Figure 2), implying that the product is unpopular. Instead, it is better to use psychological scarcity such as “just x left in stock.” The badges can also be fewer, not to make it difficult to perceive the different messages and create choice overload (Pixel Union Developers, 2021). The badges can also be varied using different colors to make different messages stand out.
Instead, fashion brands should use default options, trust symbols, and banners to make it easier for consumers to choose the desired products. An example of a successful green nudge is Patagonia’s overlay nudge, a strong pop-up nudge to advertise its section of revamping old clothing and giving it out (Figure 3). They also use an economic incentive; to give out trade-in credit in exchange for old clothing. Uninterested consumers can use the x-button, providing a good user experience. More than encouraging customers to trade in their clothes, it emphasizes Patagonia’s mission and branding as a sustainability-focused clothing brand. When using overlaying green nudges, it is important not to affect the user experience negatively — for example, using data to study when the perfect moment is for the pop-up. And to make the cancel-button obvious so users can navigate away from the overlay. Considering the Fogg-model, Patagonia-customers are likely motivated to donate clothes, and the pop-up makes it easy to do so, resulting in a successful prompt.
A Neurological Explanation for Preference of Sustainable Nudges
While consumers often have positive attitudes about green marketing, fashion purchases are seldom linked to sustainability. It reveals an unbalanced psychological state among consumers (Newman et al., 2014). At the same time, environmental priming can increase consumer preferences for fashion products with green logos. Lee et al. (2020) used fMRI to examine whether green badges that nudge consumers to purchase sustainability activate brain regions related to reasoning. Their findings implied that exposure to environmental priming messages (the nudge) increased brain activation in the superior parietal lobe and the bilateral lingual gyri. The activation in these areas supports how the nudge increased the participants’ preference for sustainable fashion products. The results show how companies should use green nudges, such as green “organic”-badges, to increase the sales of more sustainable products. It influences people to pay the green premium, which can make companies invest more in sustainable clothing as it becomes more profitable. In the longer term, increased investments can drive down green premiums, which is the goal (White et al., 2019). Customers are clearly an important part of the equation — but companies should use the available psychological tools to convince them.
Hankammer, S., Kleer, R., & Piller, F. T. (2021). Sustainability nudges in the context of customer co-design for consumer electronics. Journal of Business Economics, 91(6), 897–933. https://doi.org/10.1007/s11573-020-01020-x
Lee, E.-J., Choi, H., Han, J., Kim, D. H., Ko, E., & Kim, K. H. (2020). How to “Nudge” your consumers toward sustainable fashion consumption: An fMRI investigation. Journal of Business Research, 117. https://doi.org/10.1016/j.jbusres.2019.09.050
Newman, G. E., Gorlin, M., & Dhar, R. (2014). When Going Green Backfires: How Firm Intentions Shape the Evaluation of Socially Beneficial Product Enhancements. Journal of Consumer Research, 41(3), 823–839. https://doi.org/10.1086/677841
Pixel Union Developers. (2021, March 4). Top 10 eCommerce design mistakes and how to avoid them. Pixel Union. https://pixelunion.net/blogs/state-of-the-union/top-10-ecommerce-design-mistakes-and-how-to-avoid-them
Ro, C. (2020, March 11). Can fashion ever be sustainable? https://www.bbc.com/future/article/20200310-sustainable-fashion-how-to-buy-clothes-good-for-the-climate
Schubert, C. (2017). Green nudges: Do they work? Are they ethical? Ecological Economics, 132, 329–342. https://doi.org/10.1016/j.ecolecon.2016.11.009
White, K., Habib, R., & Hardisty, D. J. (2019). How to SHIFT Consumer Behaviors to be More Sustainable: A Literature Review and Guiding Framework. Journal of Marketing, 83(3), 22–49. https://doi.org/10.1177/0022242919825649
Wintermeier, N. (2020, July 28). Nudge Marketing: From Theory to Practice. CXL. https://cxl.com/blog/nudge-marketing/