Does Social Responsibility = Retail Opportunity?

In case you missed it, one of America’s biggest and most iconic brands was in the news recently for something other than the latest sales figures: Wal-Mart announced an ambitious plan to hire approximately 100,000 veterans over the next five years.

The plan would give veterans who have been honorably discharged since the beginning of 2012 priority consideration for available Wal-Mart jobs within 50 miles of their homes (provided that job applicants are able to perform the work, and to pass a drug test and a criminal background check). In a demographic with rates of unemployment dramatically higher than the national unemployment rate, that seems like a pretty big deal, or at least a big step in the right direction.

While I see this as a laudable move by Wal-Mart, and an initiative that hopefully encourages other retailers to implement similar programs, it made me consider the social consciousness expected from retailers today. These days it seems like more and more brands are rolling out a wide range of charitable initiatives, “green” practices and community outreach programs. But why? Are they doing it out of the goodness of their hearts — because they are responsible corporate citizens and it is the proverbial “right thing to do?” Or (to take a more cynical view) are they reaching out because in today’s retail marketplace, socially conscious behavior can be an effective marketing tool, brand-builder, and even reputation maker? Perhaps it is a little bit of all of these.

We tend to equate social consciousness in the retail world more with names like Chipotle and Ben and Jerry’s than with a huge, value-oriented retailer like Wal-Mart. The reason has a lot to do with how we, as a society and as consumers, think about and define socially conscious behavior. Wal-Mart is a great example of how a retailer’s approach to social issues can vary dramatically depending on your perspective. For example, is it commendable that Wal-Mart provides a large number of jobs and sells decent goods at an affordable price? Or is that overridden by the fact that Wal-Mart is often criticized for providing a lackluster suite of benefits and health coverage to its employees? And should we find it any less admirable that Wal-Mart is providing jobs to veterans once we realize that the lion’s share of those positions will pay well under $30,000 a year? Ultimately I think trade-offs and compromises are always going to be present when it comes to these issues, and our view of how socially responsible any retailer actually is will largely depend on what our personal priorities might be. It is also tough to change the way the public perceives you on these issues. Very few people realize that, for example, Wal-Mart has been a pioneer in implementing a wide range of green and energy efficient standards, including the early adoption of compact fluorescent light bulbs.

No matter where you come down on these issues, one aspect of social consciousness in the retail world is indisputable: consistently responsible behavior pays for itself. The publicity alone is a significant factor: the stories about a big social program like Wal-Mart’s veterans hiring initiative will not only reach a wide audience, but have the potential to generate a great deal of good will and even expand their customer base beyond their traditional demographic. To be clear, I don’t think these kinds of programs are simply marketing ploys — they can add real value and vitality to a brand. With the proper follow through, I believe that retailers who make socially responsible behavior a regular part of their business model will realize a tangible benefit in terms of the way their brand is perceived. Ultimately, of course, that translates to a more robust bottom line. It’s no longer a small niche to be a “green” retailer or a socially conscious brand: Every retailer must consider the social implications of their business and community actions. More and more are taking this step every day.

In the long run, I believe that’s a good thing — both for retailers and for the communities they serve. Do you agree retailers no longer have a choice — that they must tackle issues of social responsibility? Is this an added burden or an opportunity for brick-and-mortar stores to show their value in local communities? We’d love to hear your thoughts through a comment below or you can contact me directly at jeff@jeffgreenpartners.com.


Click here for past columns by Jeff Green.

 

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