Luxury brands are embracing purpose-led business models in a bid to navigate an increasingly turbulent consumer environment, according to Shopping with a Purpose: The New Retail Revolution.
The white paper, released in November, comes from global brand consultancy EY Beacon Institute and London based Positive Luxury, which awards a ‘butterfly mark’ certification to luxury brands that position sustainability as an integral part of their business.
Turbulent Times: According to the white paper, businesses today face tremendous levels of uncertainty and volatility in the consumer market. “Driven by a host of factors such as rapid technological developments, demographic shifts, sociopolitical instability and slow economic growth, the business environment seems to be in a state of permanent disruption,” said Valerie Keller, global leader at EY Beacon Institute. In response, brands are embracing purpose and rethinking how they create and measure value.
As consumers become more socially and environmentally conscious, overt displays of wealth are becoming less fashionable. Brands are increasingly incorporating sustainability initiatives as a strategy for connecting with consumers and generating value. Patagonia as a leading brand that uses purpose and functionality as its driving mission. The outdoorwear brand commits 1% of net annual sales to grassroots environmental groups.