The second AIM Brand Lecture on "the future of behavioural change, public or private nudging?", by Professor Alemanno, took place on 6 May 2015. In his introductory remarks, Hubert Weber, President Mondelēz Europe and Member of AIM Board, launched our new initiative AIM-NUDGE.
(For more information about Professor Alemanno's lecture, click on this link).
Ladies and gentlemen, good evening.
The theme is an important and thought provoking one: The Future of Behavioural Change: Public or Private Nudging?
And I have the pleasure to introduce our lead speaker for tonight Professor Alberto Alemanno. A true expert in this field.
Some of you may not be familiar with the concept of nudging. I am no expert either. So I would like you to take the time to hear what Professor Alemanno has to share and ask yourselves, as brand owners, policy makers and opinion leaders, how you can take these concepts and apply them to what we too often see as challenges, to turn them into opportunities?
It’s this sense of opportunity that is inspiring the new initiative we are announcing today called AIM-NUDGE.
For us, Brand Owners, it means going at the core of what Brands can do for Healthy and Sustainable Lifestyles.
The topic is not new but we’re looking at it from a completely new angle with the revealing lens of behavioural insight.
Out of the much talked about topics of sustainability, health and nutrition, consumer behaviour is the one area that industry, public authorities and civil society have no control over. Yet, consumer behaviour lies at the heart of making lifestyles healthier and more sustainable.
The relationship between a brand and a consumer is one of the closest there can be in a business context. Some of our brands have been nurturing these relationships for many decades with European consumers. Many have been around much longer than the European Union.
Brand owners have had to adapt to the evolving needs and preferences over generations of consumers.
This is what we call ‘Consumer Insight’ and it informs all our decisions in managing our greatest assets, our brands.
But what we see today is that consumers claim to want healthier choices or more sustainable products, but they don’t like the consequences of potentially different taste profile or price.
We need therefore to focus more on implicit levers of behaviour which are observed and not just “declared” to truly amplify what we have already achieved in improving our products from an environmental, nutritional and ethical perspective.
We can ‘do well by doing good’ and identify opportunities where consumer satisfaction, public goals, profit-making and growth can coexist.
It may sound obvious but we are not there yet … for three reasons. And I’ll tell it like it is:
- As companies we’ve struggled to consistently translate our corporate values and ethical principles into our brands and consumer engagement
Brand Owners usually operate within a very firm set of corporate values: What is normally referred to as CSR policies, targets etc. These values and policies are primarily conveyed to our own employees and stakeholders, but not to consumers.
- It’s difficult for stakeholders to see our ‘marketing power’ as a ‘force for good’
There is a perceived mismatch between our business goals and public goals needs. This gap can be bridged if brand owners and stakeholders are willing to engage and commit to unprecedented levels of transparency. Traditional platforms for engagement, created years ago, often do not work effectively to break these trust barriers.
- Last but not least, we have learned that what stakeholders want is not always what consumers want.
For example: In this room we may all share a wish to solve the issues of obesity and diabetes as quickly as possible. Food brands have embarked in efforts to reduce salt, sugar or fat levels, while governments have looked into restricting marketing or taxing products. These efforts may have brought some health improvements. But we have learnt the hard way that it is not enough to bring meaningful lasting change in consumer eating behaviour.
Mondelez International, the company I work for, is the largest chocolate, biscuit and candy business in the world and in Europe. We are home to beloved and trusted brands like Milka, Cadbury, Toblerone, Cote D’Or, Oreo and LU biscuits.
I pride myself to have been a champion of sustainability in Mondelez, actively supporting increased investment in sustainable agriculture: for us mostly cocoa and wheat.
We’ve achieved a lot in terms of raising standards, championing increased investment in agriculture… but it’s when we succeeded to engage our consumers that it really made the difference;
On our iconic LU Petit Beurre biscuit, connecting consumers with wheat farmers and the protection of local biodiversity through our program called Harmony showed in the sales results. The brand was slowing down in 2009, by the end of 2010 with the Harmony story on-pack the brand was growing by 10%.
But we can be more ambitious and aim to bridge the trust gap among various stakeholders on topics like health and nutrition and sustainability.
Learning about the Nudge Theory is what made us at AIM believe that we can make this happen.
We already have a legal and voluntary framework for responsible marketing. With AIM-Nudge we want to go beyond compliance and unlock opportunities
We want to inspire marketers to use their deep consumer and behavioral insights to make it easy and desirable for people to adopt healthier and more sustainable lifestyles.
The traditional way of prodding consumers to lead a healthier and more sustainable life has been to multiply the facts and information at their disposal. Reliable and useful information is very important and we enjoy a great collaboration with BEUC on better consumer information, including our common principles. But there are two risks:
The first is information overload, which can lead to confusion and a deficit of understanding.
The second is that consumers are human. And often their decisions are not purely rational. ”. This is where Nudging comes into play.
With this in mind:
- We will focus our work on some of the big issues facing European society today: good nutrition, responsible drinking, less waste and litter, less energy use, better hygiene and selfcare.
- We will work with external advisors to help us move in the right direction: BEUC, WWF and Professor Alemanno himself all agreed to contribute to AIM Nudge as advisors.
- We will create a code of conduct and toolkit that will set the basic rules for us to leverage our marketing power to purse goals of public interest and gain stakeholder trust
And if you are wondering why a food manufacturer would want people to eat less or waste less food. My answer is simple: our iconic brands have been around for generations. We simply cannot build sustainable prosperity on the back of unsustainable or unhealthy consumption.
We are here today to share the sense of opportunities and plan to be able to announce more in October.
And now I have the pleasure of handing the floor to Virginie Rozière, Member of the Group of the Progressive Alliance of Socialists and Democrats in the European Parliament, who has been very supportive of our AIM-NUDGE initiative since its inception.
Link to AIM-NUDGE one pager presentation.
Link to AIM-NUDGE knowledge portal.