How Small Business Is Tapping Into Conscious Consumption

As customers’ disposable incomes shrink, tap into their perceptions of value to boost sales.

Cost of living increases, the reverberating effects of COVID and rising climate change anxiety are all factors contributing to new purchasing behaviours that Dr Eloise Zoppos, research and engagement adviser to the Australian Consumer and Retail Studies (ACRS) group at Monash University, characterises as “conscious consumption”. ACRS studies indicate customers under financial pressure are shopping around more than previously. This represents opportunities for small businesses to beat the financial squeeze with genuine value propositions that speak to their customers’ needs, drivers and expectations.

“Australians are looking for alternatives,” says Zoppos. Those options might be price orientated. “Fifty per cent say that they are holding off or deferring purchases until sales or special deals now more than they did last year.” At the same time, “sustainability is a huge demand” and consumer surveys over several years have shown it’s becoming a much more important purchase factor.

Melbourne company Denimsmith promotes itself as “committed to the ethical production of high-quality denim clothing”. Its jeans are priced from $109 and are made in Brunswick East by its parent company, Vince Clothing, out of denim sourced from accredited sustainable mills in countries such as Turkey and Japan or from deadstocks (fabric from brands that have over-ordered or whose sales forecasts have had to be downsized). The jeans are produced in classic styles that have been designed and redesigned in response to customers’ feedback on wearability and endurance.

From the inception of the business in 2015, Denimsmith has offered free minor repairs on all its clothing. “It was really important for us that customers could always come back and have a chat about how we can construct our garments more durably or efficiently”.

In addition, Denimsmith customers who buy online and click and collect from the Brunswick East manufacturing site “can see the tranquil nature of the factory floor”, says Le. “I think that there’s something quite powerful about transparency, knowing where your garments are made and who the people are behind them.”

Zoppos cites Kuwaii, another Melbourne-based slow-fashion (locally made, limited-run, timeless styles) label, for its radical itemisation on Instagram of all the costs that go into making its $159 Heidi T-shirt and $279 Beatrix pants. “Kuwaii know what their customers want and they’re being authentic and transparent,” she says. “They’re setting the tone for their brand and providing a great example of how small businesses can play in this conscious consumption space.”

Durability and future savings are among the levers small businesses can engage to offset the up-front cost of their products. Ecoliv, a builder of sustainable, modular homes, promotes the fact that purchasers of its solar-equipped, insulated, double-glazed houses “can expect their utility bills to be reduced by about 51 per cent annually”, says director Ashley Beaumont. The seven-star energy efficiency rating of Ecoliv designs, he adds, delivers the “bonus of improved capital value, with University of Melbourne research showing homes with seven stars are worth 9.4 per cent more” than one-star homes.

It all comes down to knowing your customer and Beaumont believes that the market is growing for sustainably constructed housing. Even at a minimum cost of $379,000 for an 87.7-square-metre two-bedroom dwelling, he says buyers are willing to invest in homes aligned with their values. “The prospect of lifetime savings on energy bills, a reduced environmental impact and the ethical value of supporting sustainable practices outweigh the initial cost premium.”