Ethical Consumerism and Your Business

by Thom Tracy

2 min read

When you make purchasing decisions based on whether products and services are provided in a way that minimizes or avoids detrimental impact to humans and the environment you are being an ethical consumer. Small business owners can benefit from understanding the important issues affecting ethical consumerism and earn the loyalty of customers who place these shared principles high on their list of shopping criteria.

Ethical Consumerism in Canada

In December 2010, Abacus Data conducted an online survey concerning ethical consumerism among 1,362 randomly selected Canadian adults from an online panel of over 100,000 Canadians. The survey’s key findings included the assessment that 58% of Canadians considered themselves ethical consumers.

Only 28% of the respondents indicated that they would refuse to pay any additional price for a $100 item because of a guarantee that it had been ethically made. On the other hand, 29% of the respondents indicated that they would spend an additional $15 for a $100 item if they were guaranteed that the product had been ethically made. The survey identified ethical manufacturing conditions as excluding the use of child labor, sweatshops, and animal cruelty. When asked about discussions with friends or family during the previous year, 40% of the respondents indicated that they discussed avoiding a product or service from a company they considered unethical.

Issues Affecting Ethical Consumerism

For politically conscious consumers, ethical consumerism can be a form of political participation. According to a 2010 report, between 2003 and 2008, the level of ethical consumption in Canada increased, while participation in most other types of political activity declined or remained the same.

Ethical consumers seek products with characteristics demonstrating adherence to the shoppers’ moral values. For example, ethical shoppers seek food products from producers with a reputation for providing fair treatment and appropriate wages for farmers and other workers. Other important product qualities include elimination or reduction of the use of harmful chemicals, incorporating the use of wood products from sustainably managed forest land, and the use of products causing less pollution and waste.

There is a wide range of qualities that can attract ethical consumers to a particular brand or product. Ethical consumption can also involve a preference for locally produced products based on the rationale that shipping items over a greater distance causes more carbon fuel emissions.

How Small Businesses Can Benefit From Ethical Product Sourcing

Small businesses have an advantage in attracting ethical consumers because ethical consumption is more prevalent among people who place little confidence in large corporations. Once the conscious consumer is on the premises of a store, having ethically sourced products on display can gain the shopper’s confidence and loyalty. For consumers unconcerned about ethical consumption, a business offering ethically sourced and produced products can nudge shoppers to make those ethical purchases. Ethical consumers have a preference for local businesses – small business owners can take advantage of this niche market and win loyal customers.

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