Often I get asked whether circular design comes with a hefty price tag. Delving into this query, I recently came across an insightful perspective in The Visionary CEO’s Guide to Sustainability by Bain & Company that sheds light on a crucial aspect of consumer behavior and sustainability.
The notion among consumers is that sustainable goods are synonymous with premium products. Companies’ decisions often shape this perception, such as the manufacturing process, natural ingredients, and eco-friendly farming practices. However, the key insight from Bain & Company challenges this perception by pointing out that consumers increasingly value factors like reusability, durability, and waste reduction over traditional markers of premium quality.
There’s a disconnect between consumer preferences and company practices that needs to be understood.
The essential question for companies shaping their sustainable product strategy and design is whether consumers recognize and appreciate the values embedded in their approach. This recognition is pivotal for the success of any sustainable initiative.
If the values of sustainable strategy and design are not perceived by consumers, the purchase may be viewed as transactional or an “Indulgence for Sustainability.” In such cases, consumers may show limited willingness to purchase the products simply because the value proposition does not resonate or is not even understood by the consumers.
On the other hand, some consumers recognize the value delivered by the product, such as the product is durable enough to be used for an extended period or as a ticket to a new and meaningful experience. This perception provides a compelling reason for consumers to pay a premium for the factors that make such a sustainable product possible.
How can we re-align a company’s sustainable product strategy and design with consumer preferences?
“I perceive the goal and challenge, not merely the differentiation aspect. Can Circular Design transform your product into something unique, attracting new clients rather than just escalating costs?”Karel J. Golta
We can address the questions from two sides:
- A longer-term perspective on cost
In today’s linear world, circularity can be expensive. However, the mistake can be that we wrongly compare the cost of a well-tuned, established process with a very new one, which is still early in the experience curve. The costs associated with circular products and business models can be driven once the process is optimized (based on value chain feedback) or the volume becomes more substantial.
- Alignment with consumer preferences
The second point can be an intermediate measure to recuperate for the early rising costs associated with circular products. By providing true, additional value to the customers there’s potential to persuade them to pay a premium.
To address the question “Is circular design expensive?” without resorting to typical consulting bullsh*t answer “It depends” is challenging. The cost implications are contingent on the specific approach adopted by companies.
- Does it bring true, additional value to the customers?
- Does it align with the company’s capabilities and resources?
- Does the circular business model have the prospect of generating a return in the long term while minimizing initial investment?
I understand these questions are too big to be addressed in an article like this, but I hope that it can initiate some helpful thoughts.
One last thing, for the circular practices that do NOT align with consumer preferences, should we just so simply render them as “useless”?
Industrial & UX/UI Design