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How Businesses Benefit From Rising Conscious Consumerism

Conscious consumerism is not a new phenomenon, but one that appears to be gaining traction in marketplaces. In essence, conscious consumerism can be defined as a move toward more thoughtful purchasing and investing: one that aligns social and ethical values with everyday buying habits more closely. Many business owners dedicate time and resources to our environment or communities simply because it feels good to do so. However, there are also compelling reasons to pursue these positive impacts to help businesses continue to attract customers.


For many, the conscious aspect of consumerism has transformed perspectives of consumer behavior due to a growing awareness around ethical purchasing and its positive impact on the world around us. 


In fact, a recent study found that 78% of USA consumers[1] say a sustainable lifestyle is important to them and can potentially influence their purchasing decisions. This can also be considered in the context of shared consumer-company values. 


Businesses may be focused on building positive impacts across society and the environment. And now, further opportunity exists to incorporate impact investing initiatives into their funding needs to attract potential investors and networks with shared values.


Consumer Attitudes Are Changing

Consumers are showing that they want and need more from their purchasing experiences. This is reflected in recent data from 2023 demonstrating that 42% of Americans[2] are planning to spend more with socially responsible companies.


As businesses are integrating their ESG (environmental, social and governance) goals into their near and long term planning, consumers appear to be becoming more concerned with and committed to buying as a result of social and environmental motivations. 


Businesses can leverage these shared values of pursuing positive impacts on the environment and societal issues, and align these values with fundraising needs. Conversations with potential customers and investors may hold the key to creating an effective crowdfunding campaign, building momentum, and encouraging collaborative partnerships.


There are advantages for businesses that embrace the elements of conscious consumerism and acknowledge its growth potential in diverse markets across the globe. This article explores the benefits that businesses can tap into as they align more directly with the social and environmental values that consumers are increasingly expressing. 



Garden rooftops


Creating Loyal Connections And Investment Opportunities

There have been some consumers advocating for social and environmental change for decades. While this is a long-standing phenomenon, in the last few years, there has been increasing momentum behind conscious consumerism. 


The Conscious Consumer Spending Index (CCSIndex) reports a three-year trend in rising socially responsible spending, up from a score of 48 in 2022 to 57 in 2023[2]. As a measurable index, this research quantifies the consumer approach to spending, charitable giving and practices with an environmental focus. 


What does this mean for businesses? The conscious consumer no longer simply belongs to a niche market segment, but is representing an increasingly prominent share of the consumer population. 


Socially-minded consumers make thoughtful choices regarding products and services they want to buy, purposefully selecting companies that have distinct social and ethical values. Research completed in 2023 demonstrates the current trend, with 71%[2] of consumers buying goods or services from socially responsible companies. 


In terms of mindset shifts, this spirit is not just influencing consumer spend. It may also apply to investment decisions for conscious investors that may further support conscious consumerism's rise. Crowdfunding for business can amplify a more socially responsible investor base, driving investments in companies from customers and individuals that share a financial stake and shared values, promoting further advocacy for these businesses.


We believe that businesses implementing socially and environmentally responsible practices can benefit, such as with customers who are aligning themselves with a company’s ethics and values, who are more likely to return again as loyal brand advocates. The numbers speak for themselves, as 42%[2] of consumers plan to spend more with socially responsible brands in the future. 


Generating Positive Change With Impact Investing

Generational attitudes can influence more than simple buying patterns. When generations grow and begin to exert their purchasing power, what they believe in shapes the products and services they choose to buy. 


All generations have their own views on social and environmental issues, but the latest data exhibits how these views on the opportunity of impact investing are becoming more popular in younger people. With 62% of millennials saying impact investing has the capacity to create long-term change in contrast to 28% of baby boomers[3], it is increasingly evident that impact investing has real-world relevance as an opportunity for businesses to raise capital and build a community of investors with incentives to advocate for the business.

 

These statistics demonstrate the trend that current and future generations are showing increasing support for social and environmental change, not only in their beliefs but also in their purchasing decisions. We believe businesses and investment companies can benefit from considering  evolving consumer focus on business impacts. Crowdfunding for businesses, with The Impact Crowd's support, creates a new opportunity for businesses to leverage these trends.


Conscious Consumerism And Crowdfunding For Business

Embracing the conscious consumer movement may deliver a variety of benefits for businesses. We believe that when a business evolves their goals and incorporates social and ethical values within its plans and practices, this may enhance their reputation and lead to industry recognition alongside increased levels of loyalty from customers and other stakeholders who have shared values. 


Additionally, when businesses commit to more sustainable and ethical practices, this can help them differentiate from competitors as a company to consider  investing in and purchasing from. Moreover, there is also the possibility that developing a strong ethical mission and goals will create robust connections with new partners who have similar sustainability and socially-focused objectives. If these collaborative partnerships are established, working together for fundraising purposes could be an option that may create additional opportunities. Access to fresh markets may also become a valuable pathway, as conscious consumerism is considered across national and international markets and opens up segments previously underexplored. 


While building wider and stronger networks may provide access into untapped territory, it can also support business momentum and visibility to transform existing networks for companies to leverage when they are ready to take the next step. With a connected community behind your business, the potential for raising capital through crowdfunding and focusing on impact investments can become a meaningful opportunity. 



Happy Shopper


How Impact Investing Connects You With Conscious Consumers

As financial markets across the globe may still face a level of uncertainty, the act of impact investing in companies that are consciously sustainable with ethical values presents a new opportunity for investors who are willing to accept the associated risks, including the risks of loss. Seeking new supplies of investors by leveraging crowdfunding opportunities can support an evolving landscape of impact-oriented businesses. 


Here are some key reasons as to why crowdfunding promotes stronger ties, increased loyalty and more sustainable growth.


Accessibility

Affordability conversations are on many people’s minds these days. The Impact Crowd currently allows minimum investments of $100 per person and uses Regulation Crowdfunding rules, which allow anyone 18 or older to invest. This means anyone 18 or older within a business's customer base, personal networks, or the general public could become a potential investor in the business.  Potential investors should remember that investment offerings are speculative, illiquid and involve a high degree of risk, including the risk of loss of their entire investment.  


Social Impact Investing

Working toward a better world for everyone seems to be an increasingly prevalent topic  for younger generations. Regulation Crowdfunding provides more equitable access, as it allows anyone 18 and older, who is willing to accept the associated risks of loss, to invest in businesses with shared values. Also, when people choose to invest into the business, each investor may become a stronger advocate and supporter of the business, due to a shared financial stake in the business. The Impact Crowd focuses specifically on hosting these impact-oriented business fundraises, promoting shared values between businesses and potential investors.


Opportunity to Confront Inequities 

According to Zippia as of 2021 and Forbes as of 2022, while almost 36% of entrepreneurs are women and nearly 11% are Black, less than 10% and 1% of venture capital dollars go to funding their businesses respectively [4], [5]. These businesses may struggle more to get funding themselves, and they could also be looking for better ways to encourage and support more diverse communities. As such, crowdfunding initiatives executed by companies with these shared values can facilitate investments from the general public 18 and older in ways that were less available prior to Regulation Crowdfunding rules, and The Impact Crowd wants to help.


Conscious Consumerism With The Impact Crowd

Are you ready to embark on your crowdfunding journey? Let's work together to create capital-raising opportunities for your business that can also support positive environmental and social change, while potentially bringing additional conscious consumers and advocates to your brand.


The Impact Crowd would be happy to discuss your individual business’s fundraising needs further with you, along with how you could structure your desired positive impact. You can connect with us today at fundraise@theimpactcrowd.com to explore how we can support your business’s crowdfunding plans! And, join The Impact Crowd to receive notifications about our new investment opportunities as well as future articles discussing impact investing and other related topics.



References:

[1] NielsenIQ, “Sustainability: the new consumer spending outlook”. 2022. Available: https://nielseniq.com/wp-content/uploads/sites/4/2022/10/2022-10_ESG_eBook_NIQ_FNL.pdf [Accessed May 2, 2024]

[2] Good.Must.Grow., “Is Good Still Growing?” 2023. Available: https://goodmustgrow.com/cms/resources/ccsi/gmg2023ccsifinal.pdf [Accessed May 2, 2024]

[3] K. Arora, “Impact Investing Unlocked: Inside The White-Hot Equity Crowdfunding Revolution” July 25, 2022. Available: https://www.forbes.com/sites/forbesagencycouncil/2022/07/25/impact-investing-unlocked-inside-the-white-hot-equity-crowdfunding-revolution/?sh=60b793fe47e5 [Accessed May 2, 2024]

[4] S. Gupta, “Diversity: The Holy Grail Of Venture Capital”. May 26, 2022. Available: https://www.forbes.com/sites/forbesbusinesscouncil/2022/05/26/diversity-the-holy-grail-of-venture-capital/?sh=216494424178 [Accessed May 2, 2024]

[5] Zippia, “Founder Demographics and Statistics in the US”. 2021. Available: https://www.zippia.com/founder-jobs/demographics/ [Accessed May 2, 2024]


Disclaimer:

Investment offerings are speculative, illiquid and involve a high degree of risk, including the risk of loss of your entire investment.


 Any opinions expressed herein are those of the author(s) and are for informational purposes only.  The information and opinions expressed herein are subject to change without notice and do not take into account the particular investment objectives, financial situation or needs of any specific investor(s). Additionally, any factual content in this material was obtained from sources believed to be reliable, but we do not warrant the accuracy or completeness of any information contained herein and provide no assurance that this information is, in fact, accurate.


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