SXSW14: The future of business lies in empowered consumers and empowered employees
The future of business lies in the hands of empowered consumers and of companies' empowered employees, the founder and chief executive of Change.org, Ben Rattray, said today (8 March) as businesses continue to operate in an increasingly transparent world.
Ben Rattray, founder and CEO Change.org
Speaking at the SXSW interactive festival, Rattray said businesses are beginning to change not only the products they sell to consumers but also the ways that companies are run and how they treat employees because of the increased power of petitioning and social accountability.
He said "the wind is at our backs" in terms of transforming businesses from the perspective of having an "exclusive focus of profit maximisation and shareholder value to a stakeholder perspective and a much broader vision of the possiblities of business".
This, he argued, means that the tech industry has the power to be at the forefront of this changing business landscape, stating: "If there's any industry in the world that has the best chance at pioneering a movement to use business in the service of social impact it is absolutely the technology industry."
Empowered consumers at scale
Rattray said the first example seen at change.org of consumer empowerment happening at scale was started by a 22 year old part time nanny called Mollie, who took the Bank of America to task over its $5-a-month fee to consumers for the use of its bank card.
"As a reminder the Bank of America had been bailed out in part by the American public and then contributed, with a number of other banks, to a law that made it difficult to switch you own bank, and then after this added a $5 fee to use your own bank card every month," he added.
Rattray explains there wasn't an immediate reaction to the new charge until Mollie started a petition on the global platform. It achieved 300,000 signatures; made Mollie a "permanent fixture" across daytime television; mobilised people outside of the bank and helped to get "thousands of people to pull their money out of the bank of America".
After a month of campaigning, Mollie "got the biggest consumer bank in America to rescind the $5 fee as did every other major national bank".
The power of young people
Young people are increasingly "peircing this veil of corporations and calling on them to be their best selves". Rattray showed a picture of a Californian fourth grade class who have dubbed themselves the "Green Team". He said the team loved Crayola pens but had found out that the company was letting "hundreds of millions of plastic cartridges being thrown away and not recycled every year".
The children started a petition on change.org asking Crayola to implement a proper recycling programme, and though they gained more than 80,000 signatures, they were ignored by the company. However, a pencil company that had seen the work of the children, held a press conference to launch their own recycling programme inspired by the Green Team's work.
"So what does Crayola do? Two months later they change their policy and implement their own recycling scheme shamed by this pencil company and fourth graders in California," Rattray said.
He added: "It's an incredible illustration of how the businesses that used to have their brands largely defined by paid advertising and paid marketing, and in the past had policies that were largely obscured to most people, are now in a radically transparent environment where they cannot hide.
"You have to listen to your consumers as they are going to drive the future of your business."
Companies' internal disruption
"The consumers that are now mobilising like never before, calling on companies to be accountable, are the same people that work for you – just because they work for the company doesn't mean they don't care," Rattray said.
He used the example of a 15 year old girl called Mia who loved the Jamba Juice brand, but discovered that they did not use compostable cups. After she created a successful petition Jamba Juice agreed to switch to 100% compostable cups, though the change in company policy did not come from Mia's actions alone, Rattray said.
"The impact wasn't exclusively down to Mia and the 100,000 people who backed her," he said, "it was the employees at Jamba Juice who themselves had signed the petition, talked about it, and advocated it themselves."
Rattray said that even though Jamba Juice's own sustainability team had tried impletment this change previously with no effect, the petition from Mia had not created the "trigger effect" seen with Molly's campaign, and the company had not previously felt the obligation to change the policy on its cups.
"But when you have this massive outpouring of support externally demonstrating consumer demand, and then it really seeps internally to disrupt your own organisation, that is what is incredibly powerful and this is going to accelerate significantly," he said.
This article was first published on marketingmagazine.co.uk
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