by Emily Curwood
Throughout
the 21st century the environmental impact and sustainability of a
business or company had been scrutinised more and more heavily, as a result of
the ever-increasing threat of climate change. Given this, whole new target
markets have been created for the eco-conscious buyer, leading to the creation
of new businesses, such as clothing company Patagonia. But while new businesses
are being created, it is the way that existing businesses, especially the
multimillion-dollar ones that have already established a huge customer
following, react and evolve to compete with this thriving sector that is
perhaps most interesting.
In the case
of increasing sustainability without sacrificing customers or market share,
IKEA is a very successful example; the company now consistently appears in
multiple lists for the world’s most eco-friendly businesses. The fact that they
have invested in sustainability throughout its entire business operations shows
IKEA’s commitment, not only do they hope to be powered by 100% renewables by
2020, and, in a step towards that goal have 700,000 solar panels powering their
stores, they have taken their image of being a sustainable business a step
further by announcing that they will start selling solar panels to UK customers
in the near the future. While there are many more examples of successfully
eco-friendly businesses with some, like IKEA, not only adapting to what the
world needs but also going a step further and profiting from selling and
spreading their initiatives into the market.
However,
there are businesses that have not managed to find that all important balance
between customer satisfaction and thus customer loyalty that is key to a
business’ success in the market, and, consequently their survival. McDonalds’ change
from plastic to paper straws in order to avoid the negative environmental
impact of its waste disposal raised a few eyebrows but the customer faith in
the fast food chain meant that it was reluctantly accepted by customers, however
the move was greatly appreciated by sustainability advocators, given the move
to paper straws by multiple other large chains like Costa prior to this
decision by McDonalds. But this need to prioritise the ethical considerations
meant that customer satisfaction greatly suffered, the disapproval towards the
change was made clear when a customer campaign with over half a million
supporters forced the hand of McDonalds, who, as a result, announced recently that they would be introducing
an “evolved” paper straw in order to regain customer support.
Therefore,
McDonalds shows that sometimes tipping the balance towards being more environmentally
friendly is not necessarily the best solution for a business and that the line between
the two is fine; trying to appeal to the new and growing demographic of sustainable
customers, without alienating your current customers is a difficult task. In
addition, these so called “eco-friendly” straws are not even recyclable, and,
in addition to the fact that 1.8 million are used every day, McDonalds
sustainable goal of reducing their waste has not even been met. This failure to
adapt to the evolving, more eco-conscious, market is a common trend for fast-food
chains; Burger King and Subway are only now changing their plastic bowls,
cutlery and straws, and only due to the new EU laws. This proves that the
reluctancy, and, in McDonalds case, avoidance of real positive environmental
impact, is commonplace in big name industries.
Although McDonalds establishment in the market
means that this balance between customers and sustainability doesn’t come with
as high stakes as a new business- they can afford to make mistakes as they know
that customer dissatisfaction won’t necessarily equate to less customer
loyalty. However, finding this balance and consequently evolving your business
for the better, not only gives the positive of helping the planet, but also
often leads to better business initiatives, new customers and overall greater
success.
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