Traditionally, consumers have been overlooked in the context of the circular economy, leading many companies to neglect the importance of communicating circular economy-related innovations to their target audience. However, recognizing the pivotal role consumers play in driving sustainable choices is crucial for businesses aiming to leverage the circular economy as a competitive advantage.

In this regard, the Finnish Ministry of the Environment recently published a comprehensive report titled “Consumers in the Circular Economy: Towards a Society that Promotes Circular Economy and Repair,” which sheds light on consumer behavior and their role as promoters of the circular economy.

While the circular economy has gained significant traction in sustainability and sustainable development, consumers have often been relegated to the sidelines instead of being recognized as central actors (Repo, Mykkänen, & Lammi, 2023). Despite this oversight, consumer choices increasingly influence consumption trends (Kirchherr, Reike & Hekkert 2017).

Interest in corporate responsibility is growing

It is worth noting that consumer interest in corporate responsibility is on the rise, particularly among young adults who base their brand choices on value-based considerations (Sanoma 2022). This growing segment of consumers represents a significant economic force that should not be underestimated.

Finland, with its high living standards, educated population, and widespread environmental and climate concerns, provides a solid foundation for promoting the circular economy. Finns already exhibit an interest in recycling and product repair (e.g., Repo et al., 2023), making the transition to a circular economy less challenging compared to other countries.

However, only a few Finnish companies have positioned themselves as pioneers in the circular economy due to diverse and often financial reasons. Challenges such as the cost-effectiveness of sustainable alternatives and supply chain complexities hinder wider adoption.

Despite the hurdles, building a brand around the circular economy is worth pursuing, as corporate responsibility offers a competitive advantage. It is not necessary for consumers to have an in-depth understanding of every aspect of a company’s sustainability efforts. Rather, providing sufficient information for consumers to form an opinion and conveying a clear and straightforward message is essential.

Consumers are skeptical by nature

Consumers are naturally skeptical of corporate responsibility initiatives, and isolated actions can be misconstrued as greenwashing. A study revealed that only 23% of Finns trust corporate responsibility communications (Kupula 2022). However, effective communication plays a central role in building trust and conveying a company’s values to consumers.

Aligning messages and consistently communicating about initiatives, even during the ongoing journey towards corporate responsibility, can help establish credibility and engender consumer trust.

To incorporate the circular economy’s branding into a company’s story, perseverance is key. Highlighting various milestones enables the construction of a coherent narrative that consumers can follow over an extended period. The story should be presented in a way that resonates with consumers, based on factual information and the company’s tangible actions.

Visual elements, such as graphs and illustrations, can enhance communication clarity. Companies can incorporate sustainability solutions into their annual reports, websites, or native advertising, intertwining them seamlessly into their storytelling. Such approaches ensure that consumers gain a comprehensive understanding of the company’s commitment to corporate responsibility.

Clear communication of a company’s commitment to corporate responsibility not only increases consumers’ potential to contribute to the circular economy but also enables the exploitation of growth potential within the circular economy sector. Recognizing the pivotal role of consumers and effectively communicating circular economy initiatives to them is essential for leveraging the circular economy as a competitive advantage.

By aligning messaging, addressing consumer skepticism, crafting impactful stories, and enhancing communication clarity, companies can position themselves as leaders in the circular economy while also driving consumer engagement and participation.

References

Corvellec, H., Stowell, A. F., & Johansson, N. 2022. Critiques of the circular economy. Journal of Industrial Ecology, 26, 2, s. 421–432.

Hobson, K. 2020. ‘Small stories of closing loops’: social circularity and the everyday circular economy. Climatic Change, 163, s. 99–116.

Kirchherr, J., Reike, D., & Hekkert, M. 2017. Conceptualizing the circular economy: An analysis of 114 definitions. Resources, Conservation and Recycling, 127, 221–232.

Kupula, N. 25.10.2022. Miten kuluttajat suhtautuvat vastuullisuuteen juuri nyt? Sanoma.

Repo, P., Mykkänen, J. & Lammi, M. 2023. Kiertotalous kuluttajien näkökulmasta. Teoksessa Berg, A., Heiskanen, E., Matschoss, K. & Posti, M. (toim.) Kuluttajat kiertotaloudessa. Kohti kiertotaloutta ja korjaamista edistävää yhteiskuntaa, s. 11–16. Ympäristöministeriön julkaisuja. 2023:5. Finnish Ministry of Environment. Helsinki.

Sanoma 2022. Vastuullisus markkinoinnissa.