Authenticity is everything: an eco-initiative means nothing if nobody believes it | Deloitte UK has been saved
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On 22 July 2021, a world record was broken, but not for running, swimming, or eating hot dogs. A Pokémon card (specifically, a Pikachu Illustrator card) was acquired for US$5.28 million – the most ever paid.1 A trading card is small, around 9cm high, with nothing of intrinsic value printed on either side. Its value comes from scarcity. In the case of Pikachu Illustrator, it is over 20-years old, and only 39 are known to exist. Ahead of the world record, PSA, which offers a grading service, authenticated the card, and granted it “grade 10”, for the highest possible quality. Its nearest comparator, a “grade 9”, is worth a staggering US$4m less. Realising the value between a genuine card and a modern fake depends on one thing… authenticity. Without the authenticator, no card has value, and the world record does not exist.
Why does this matter for sustainability? Because the difference between a genuine Pokémon card, and a fake, is almost imperceptible to the average consumer. Likewise, the average consumer has little to no workable knowledge of climate and the environment. For example, the newest and best iPhone, the iPhone 14 Pro Max, has a lifetime carbon emission estimate of 73kg.2 But the problem for consumers is… how do they know this is accurate? What impact does this actually have on the planet? Is 73kg a lot, or a little? How does it compare to other emissions across our lives, such as food, travel and heating? Consumers rely on companies, regulators, governments, and the media to authenticate causes they care about, and also to provide context where causes are complex.
Deloitte’s Digital Consumer Trends3 asked a nationally representative sample of 4,160 people in the UK about their knowledge and expectations of sustainable credentials.
Figure 1: Consumers lack knowledge, and they know it.
The smartphone is the most pervasive consumer device, 92% of us have one. More than half of us (52%) use it the moment we wake up, and 18-million of them are set to be bought by UK consumers this year.4 In the UK, the average adult has probably had at least four smartphones in their life. So, in theory, we should know about our phones.
As per Figure 1, only 14% of people claim they could state the carbon footprint of their phone. And in reality – many of these confident few will be wrong. 68% disagreed that they would be able to state this, and 13% neither agreed nor disagreed. For many devices, this information is not readily available to consumers. For many more, it may be available, but they do not know where to look. It is fair to assume that knowledge is probably as bad across other digital product types: PCs, tablets, wearables, smart speakers, audio earbuds, smart home appliances and more. Consumers are also unlikely to know how their cloud service usage impacts the environment. Data centres use 1% of global electricity5, but quantifying the impact of a single, personal video stream is near-impossible. One thing is clear, consumers do not know much, yet.
Figure 2: Consumers want to know more.
Consumers crave better information about the environmental impact of their digital goods and services. Per Figure 2, 61% think companies should be forced to disclose carbon footprint. 26% neither agreed or disagreed with this, and just 8% disagreed.
Sustainable choices are a growing focus for consumers. As per Deloitte’s Sustainable Consumer survey, consumers are focusing on buying just what they need (+20 points vs previous year), on reducing meat consumption (+9 points) and opting for low carbon emission modes of transport (+11 points).6 These actions have clear sustainable outcomes. However, when it comes to digital products and services, outcomes are often less clear. When choosing between device brands, or subscription services, the consumer rarely has a chance to analyse two choices based on a clear sustainable metric. In smartphones, for example, telcos have allied to create an ‘eco-rating’ for devices, but this is rarely available at the point of purchase.7
Figure 3: Consumers lack trust in tech companies to be the authenticator.
The irony, however, is that even if tech companies disclosed the carbon footprint of their products, most consumers would not trust what they publish. Per Figure 3, just 32% of consumers trust tech companies to be truthful about carbon, 32% neither agree nor disagree and 31% do trust them. And so, we are back to authenticity.
Across all industries, not just tech, over one-third of large global publicly traded companies now have ‘Net Zero’ targets. In addition to that, tech companies are also investing to:
However, if consumers do not believe tech companies, then the brand cannot realise the value of these investments – just like how a Pokémon card needs an authenticator to realise its value. In tech, many of the global dominant brands are not new anymore. If a 30-year old PC brand approaches its customer base with a flashy Net Zero strategy, the customer has every right to ask what that brand had been doing for the prior three decades.
Tech brands cannot only explain what they are doing – they also need to explain why. They need to talk about the impact their sustainable outcomes will have, and by extension, the impact that their customers can have on the world. They need to demonstrate that sustainability is at the core of all company decisions, not just a marketing tool to generate demand from eco-conscious consumers. And they need to find trusted authenticators to rubber stamp what they are doing.
That authenticator might be a regulator, or it might be an aggregator (such as a telco). Or it might be a large global charity. In the same way that PSA is wholly trusted by collectors of Pokémon cards, and its grading service has immense value despite being almost imperceptible to the human eye, tech brands also need to find means to authenticate their message on sustainability, so that a lack of consumer trust stops being a barrier to sustainable decisions.
Authenticators are everywhere. Taking a broader view of the consumer, it pays to ensure that the products we buy are genuine, whether it is the new Nike Air Jordans, a Louis Vuitton bag, or a Rolex watch. If sustainability is truly a part of the modern customer’s purchase journey, the role of eco-authenticators is about to become much more important.
1 Guinness World Records, https://www.guinnessworldrecords.com/news/2022/4/logan-paul-owns-5-275-million
3 Deloitte Digital Consumer Trends, https://www2.deloitte.com/uk/en/pages/technology-media-and-telecommunications/articles/digital-consumer-trends.html
4 Canalys estimates, Smartphone Analysis, https://www.canalys.com/analysis/smartphone
5 International Energy Agency's “Data Centres and Data Transmission Networks” https://www.dw.com/en/data-centers-energy-consumption-steady-despite-big-growth-because-of-increasing-efficiency
6 Deloitte Sustainable Consumer survey, https://www2.deloitte.com/uk/en/pages/consumer-business/articles/sustainable-consumer.html
7 Eco Rating, https://www.ecoratingdevices.com/
Ben Stanton is TMT Insights Manager at Deloitte, casting perspective on the big issues in technology, media and telecommunications. His research spans devices, connectivity, media, sustainability, data privacy, and the metaverse. As part of this, he leads Deloitte's worldwide Digital Consumer Trends survey and contributes to its annual TMT Predictions reports.