By shifting from products to services FMCGs could yet become sustainable businesses

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To tackle the climate emergency, we urgently need to cut consumption. As the FMCG category faces greenwashing crackdowns from the CMA, Jos Harrison, head of brand experience at Reckitt explains how a shift in the business model is needed.

The latest IPCC report made for sobering reading. Scientists delivered a final warning – “Act now or it’s too late”, with the headline finding that there is more than a 50% chance that global temperature rise will reach or surpass 1.5 degrees celsius between 2021 and 2040. Incredibly, several weeks later, scientists published a shocking revision to that – we will likely crash through 1.5 degrees before 2027.

It is a call to action that brands need to take seriously. In addition, recent data from market research company GWI showed a gradual increase in environmental apathy. So, businesses must urgently find a way to connect with people on sustainability – but all too often they have been largely approaching the challenge in the wrong way.

So far, the approach has revolved around telling people what (and what not) to do. But to have a real impact, we will need more than innovative packaging solutions and small behavior changes. Instead, brands need to rethink how they sell – and shift from a product-led to a service-led model.

Shifting towards service-led

Looking at providing solutions as a service, rather than at an individual product level, is crucial. If you’re designing a product, you’re first thinking about the in-use moment. Then you think about how it has to be shelved in supermarkets, how it needs to be promoted to get to the front of someone’s mind before they enter the store. Whereas if you’re designing as a service, you can’t think in such a linear sequence anymore.

You need to design the entire service, and that makes you think about how to connect those various touchpoints and the overall brand experience. It’s a much richer and more human way of interacting and thinking about a brand’s role. This ultimately enhances the empathy between the brand owner and the end user, which is essential if we want to help change behavior and win people over.

A sustainable future for the FMCG industry – and a future that supports sustainable lifestyles – has to center on these types of service business models. Locally fulfilled for minimal carbon footprint, they will mean a move away from a focus on manufacturing millions of individual ‘consumer units’. Crucially, these reimagined FMCG business models will mean an equitable distribution of additional wealth at a smaller scale and the creation of jobs for those in industries that have to go through managed decline.

Products – or consumables – will undoubtedly be part of these models. But are they going to be ‘consumed’ by the end user in the format we currently know? Absolutely not.

Such services could be offered via an Uber-like app – for example, to contract someone to come into your home and disinfect once a week. They would be provided by a big-name cleaning brand, but in collaboration with a trained and accredited small to medium-sized enterprise, facilitated through digital platforms.

Making sustainability more human

To make this work, though, brands need to keep that empathy front and center and find ways in which to connect with that 80%. They need to start making sustainability more human.

A new report by Accenture Song, which looked at what sustainability means to people around the world, found that they don’t have to care about sustainability to act sustainably.

Moving towards a more sustainable life is inextricably linked to the complexity of people’s thoughts, ideas, values, socioeconomic conditions and so on. The report identifies six universal human values (caring, self-fulfillment, belonging, resourcefulness, empowerment, openness) that connect people with sustainable action more strongly.

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Entry points to behavioral change

So, there is a marked difference between how organizations assume they should define sustainability, and what is needed to encourage sustainable action. Only by linking to these universal human values can brand owners work with people to effect a real shift in behavior.

Those six universal human values are entry points to true behavioral change. Brands can use them to direct new strategies and programs, asking themselves, “Am I triggering one or more of these entryways? Am I tapping into these human motivations to help people be more sustainable without putting them off?” If they don’t do this, they’re missing a huge opportunity for real cultural change.

But driving this move away from the predominant product paradigm also needs to be a focus on collaboration and partnership. It will be the key to making this transition successful. Mobilizing new business models at the scale of global FMCG owners will only happen if they are open to learn, to experiment, to acknowledge the expertise of smaller partners, and casting aside normal assumptions of proprietary technology.

It’s an opportunity for all the brightest parts of multiple industries to work together to shift people’s behavior – to act now before it’s too late.

Jos Harrison is global head of brand experience at Reckitt.

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