Case Study: Does Sustainability Matter to Chinese Customers?

A number of reports, such as one conducted by Nielsen in 2015, have shown that sustainability became one of the priorities determining a purchase decision for global consumers.How strong is this sentiment in China? And how can a company working in one of the most polluting industries in the world boost its image?

What can sustainability bring to a company 

Let’s look at the reasons why companies embark on the journey to do good for the environment and communities their business affects. A better public image is probably the first reason on the list. At some poit, sustainability is a way to stand out and win more consumers’hearts.

Receiving positive recognition from media is extremely important for a company, and embracing sustainability/CSR initiatives helps driving more media coverage. Recently, even employees engagment has seen an interesting shift towards sustainability: it seems that sustainable practices now give a competitive edge to the companies that want to attract the younger generation’s best and brightest.

Still, nothing supports a company’s decision to embrace CSR, as actually receiving profit from it. How sustainability policies pay off

In the last few years, a growing number of companies take CSR and sustainable practices seriously. However, it is not yet a standard across various industries, but rather an advantage that brands can leverage not only to elevate their image.

Research shows that sustainability actually generates profit. For instance, a Harvard Business School study, using a sample of 180 companies, found that companies which voluntarily adopted sustainability policies more than 15 years ago significantly outperformed others over the long-term in the stock market. Similarly, The Business ROI of Social Investments report, launched by ACCP and IO Sustainability shows that contributions companies make to support the well-being of communities, individuals, and environmental systems can boost share price by as much as 6%, increase sales by 20%, and productivity by 13%.
Sustainability sentiment among Chinese consumers

How do consumers feel about sustainability in China, where environmental side effects are woven into the fabric of daily life? 70% of Chinese consumers already have a certain degree of awareness about responsible consumption, according to report, released jointly with the UN Environmental Programme in Beijing last year. The report also revealed other findings: nearly half of consumers are willing to pay more for sustainable products if the price doesn’t exceed 10%, which it does currently. Perhaps the judgment about product sustainability and purchase decision is somewhat limited now, but the overall, the sentiment is there.

Branding and sustainability

For companies working in the second most polluting industry in the world—fashion—projecting a sustainable image is a powerful branding tool. PLTFRM recently worked on the rebranding of a textile company, delivering Polyviscose fabrics to all major fashion brands. Here’s how with our help, they boosted the brand image through sustainability.

In 2010, XinTianYuan expanded their technology into “top dye” process/category. This allowed to increase the quality of the product, by reducing water and waste by nearly 80% in the production phase. This was a courageous and successful move, helping XinTianYuan to shift the company’s culture with a focus on sustainability in everything they do. However, this shift had little influence over the brand’s image, as it wasn’t highlighted clearly enough.

XinTianYuan requested PLTFRM to articulate their core belief, and after a series of interviews to understand the company from the inside, the core vision turned into “By Improving Ourselves, Today, We Improve All Our Tomorrows”. The core belief was then aligned with XTY value proposition “Million Miles color consistency” and the slogan “Tomorrow’s textile”, along with a highly systematic and functional Visual Identity. XinTianYuan is now the leader of China’s textile market and the role model of a movement to make the fashion industry much more sustainable than it is today.Outlines:

  1. Reports have shown that sustainability became one of the priorities determining a purchase decision for global consumers. Responsible consumption awareness is spreading in China.
  2. Sustainability pays off: these policies can boost share price by as much as 6%, increase sales by 20%, and productivity by 13%.
  3. As China’s implementing tougher environmental policies, looking for ways to achieve economic growth in a sustainable manner, projecting a sustainable image is a powerful branding tool. As Forbes article stated: “Any business seen as alternatives to polluters, and any business seen as benefiting from being part of the clean-up crew will see above market average growth”.

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