Northumbria University professor speaks on the rise of the ethical consumer

We look at why companies can no longer ignore complaints

Jiri Rezac/Greenpeace/PA Wire Lego figures fitted with protest banners, by Greenpeace activtists, to save the Arctic from oil drilling
Lego figures fitted with protest banners, by Greenpeace activtists, to save the Arctic from oil drilling

The old maxim that the customer is always right has never been more true.

In the age of Facebook and Twitter, in which complaints can go round the world at a click of a mouse, businesses can no longer afford to ignore consumers. Once small-scale movements like Fairtrade are now mainstream and political activists will organise boycotts of countries (South Africa in the 1980s, Israel now) or companies with poor environmental records (such as the recent campaign to get Lego to end its association with Shell).

Even at an individual level, people are more in tune with when to complain and how to do it than ever before, says Helen Woodruffe-Burton, professor of marketing at Newcastle Business School at Northumbria University.

The latest company to learn that consumers are not to be trifled with are payday loan company Wonga.

The Newcastle United shirt sponsors have softened their approach following an outcry from the public and action by the Financial Conduct Authority.

Many a company has learned a similar lesson after being given a bloody nose because its customers have said enough is enough.

It might be a question of moral business decisions such as how much it pays workers in poverty-stricken countriesor it might be a groundswell of opinion over a domestic issue such as interest charges or making excessive profit on the provision of energy.

Or something personal to one customer which somehow, thanks to social media, gets known by thousands.

But, whatever the issue, companies know they can never simply ignore complaints.

Consumer power can and does make a difference in today’s world of social media and instant communication.

Professor Woodruffe-Burton said: “It does make a difference and I think the big thing is the internet and social media. Consumers are more vocal and more sophisticated in the information they have access to than ever before.

“In days gone by what would you do? Go to the shop, perhaps, and then write a letter which might or might not be acted upon. Now you can tweet and leave messages on social media and, if you catch people’s attention, it can go international.

“We are seeing a very fast acceleration in this way of making a point.

“We have always had consumer rights. There have been campaigns to change the way companies behave long before the internet.

“Camra is probably the UK’s most successful ever campaigning group and we have Peta, People for the Ethical Treatment of Animals, and Greenpeace which are essentially consumer campaigns.

“It’s always been there but now there is more consumer concern about production and manufacture. The rise of the so-called ethical consumer is a result of the internet and social media.

“It’s not enough to say you are green, you have to show you are green by cutting greenhouse emissions, for example.”

Opposition takes many forms from the simple act of opening a Facebook page to get an individual point across to national and international campaigns.

Jaake Tod, of North Shields, could have suffered in silence after cancelling a holiday flight with Jet2 when his wife Natalie was diagnosed with oral cancer and had most of her tongue removed. The airline had refused to help when he asked for a refund.

The family had not yet taken out insurance to cover cancellation but, after a campaign on social media reached thousands of people, Jet2 changed their minds and refunded the family.

Messages of support poured in and Jet2 was forced into a situation where it had to respond.

Jaake said: “I decided to tell as many people as possible on Facebook and Twitter.

“Three thousand people liked the page in 48 hours, Jet2 saw it, realised people were talking about it, and messaged me to say they were going to give me a refund.

“Another family in the same position were following what was happening and I was talking to them via social media as well. They had been fighting Jet2 for five months and had got lawyers involved but the airline decided to refund them as well on the back of the discussion going on about us.

“You don’t know how these things will snowball if they catch the public imagination.

“Without social media we would not have got so many people involved and maybe the result would not have been the same. Total strangers sent us messages of good luck and really cared for us. Jet2 knew that and had to do something to show they had a heart.”

There are many other examples as people are ready to stand up and be counted over issues that matter to them.

The tax dealings of multi-national companies like Starbucks, Amazon, and Google has put the companies in the public eye in a way they would rather not. Social media has galvanised boycotts and taught the public they can do something by simply not giving money to companies caught up in what are now called tax shame scandals.

You can walk past a Starbucks to another coffee outlet, use companies other than Amazon for online shopping, and uninstall Google Chrome on home computers.

Experts suggest it’s got a lot to do with a sense of fairness on the part of consumers who have had to struggle financially since the economic crisis and want to know that big business is doing its part to show honesty in the way they deal with hard-pressed customers.

Professor Woodruffe-Burton says companies are now forced into the position of listening.

She said: “They’re have been a few high profile mistakes by companies. There was the American food chain Chick-Fil-A which got into trouble with consumers because one of their owners spoke out against same-sex marriage.

“It was then revealed they were making donations to political organisations which took an anti-gay stand. A few individuals started a campaign to boycott the company, then it was taken by the LGBT community, and then ordinary customers.

“They had to respond, they had to take steps to put their message across, because it was getting so much attention.”

One high profile case was a campaign started by the Vegetarian Society following an announcement of plans to use the animal product rennet in Mars Bars.

The campaign started when the society urged members to complain to the company, their MP, or local newspaper. Within a week the firm had received more than 6,000 calls and e-mails and 40 MPs had signed a petition.

Mars promptly agreed to revert to the old recipe, apologised, and declared the “consumer is our boss”.

It was the champions of ethical consumerism that brought a change in culture at pay day lenders Wonga.

The Newcastle United shirt sponsors had been subject to constant criticism by the public, watchdogs, and press. Complaints included high interest rates, misleading advertising, and the admission they had send letters to customers which seemed to come from law firms when in fact they were originated from Wonga itself.

Wonga had admitted its previous lending criteria were wrong.

“We have strengthened our lending criteria to ensure that we only lend to customers we believe can reasonably afford to repay their loans,” said a spokesman. “We’re changing the way we make decisions about lending, and setting additional requirements around the financial circumstances of people we can lend to.

“On conducting a review into our previous lending criteria, we recognised that we may not have always made the right lending decisions, and on reflection some of these loans may not have been affordable.

“Consequently we’re implementing a major forbearance programme for existing customers whose loans would not have been made had they been subject to the new affordability criteria.”

The measure will cost the company £220m in debts which have been written off but it might not be enough to get the public behind a brand which has been the subject of so many complaints.

Just this week MPs have renewed their calls for Wonga to be banned from having its name on children’s replica Newcastle United shirts.

Politicians say the company, and other payday loan firms, should be brought in line with the alcoholic drinks and gambling industries following a crackdown on lending practices by the financial regulator.

The fresh demands follow comments by new Wonga chairman Andy Haste, who said he did not want to target the “vulnerable and the young.”

Under the rise of ethical consumerism he can expect to be held to his promise.

Professor Woodruffe-Burton said: “More people are aware of consumer rights. People are more willing to check it out. There are numerous review sites and this word of mouth, even if it is not literally word of mouth, makes a difference.

“We like reading the experience of other people and because it is real consumers like ourselves we trust it. The big thing about Wonga was exposure in the media about the use of bogus legal firms.

“A lot of ordinary members of the public would find that unacceptable. We expect companies to behave in an ethical manner.”

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