Today, Millennials represent 30 percent of the population and are regarded as the most diverse in U.S. history with nearly 44 percent identifying as an ethnic or racial minority. According to Russell Reynolds Associates, this shift has caused customer attitudes, and behavior, to change as well, finding 60 percent of shoppers wanting retailers to “be a part of the dialogue around social issues.”
Despite consumers demanding not only brands that prioritize diversity and inclusion but also creating distance with brands that fail to embrace social values, the research found that “more than half of consumer organizations [to be] in the early stages of diversity and inclusion strategy or [have] no strategy at all.” Further, only 32 percent of consumer executives told Russell Reynolds Associates that their leaders “make a visible commitment to diversity and inclusion.”
Forty-two percent of consumers responded to the company’s survey saying they would pay a premium of 5 percent, or more, to shop at a retailer where they can see a commitment to diversity and inclusion.
Store environment and diverse products and services are listed as the top catalysts for consumers to consider another brand. The report highlights efforts made by Chobani internally showing visible commitment by offering fully paid six-week parental leave for mothers and fathers.
Additionally, the company notes that establishing internal leaders and committees to support a diversity and inclusion forward strategy is a meaningful step in achieving diversity and inclusion goals. An example of this is Gap’s ASCEND program which utilizes mentorship programs to create an inclusive and diverse workforce that will be encouraged to become future leaders.
“The best-in-class organizations showcased all have one thing in common — they’ve taken the initial steps toward their D&I goals, even if those steps felt risky,” said Evan Sharp, a member of the chief marketing officers practice at Russell Reynolds. “Accountability for, and measurement of D&I initiatives will be critical for organizations that want to elevate their D&I strategy. This level of commitment is ultimately what will drive deeper engagement and stronger business results with consumers.”
Looking ahead, the authors of the study say “consumer organizations must make meaningful change,” investing in a diversity and inclusion strategy that is rooted in a holistic mission. “While advanced [diversity and inclusion] organizations will experience better business outcomes than other organizations, those that take a reactive, check-the-box approach to [diversity and inclusion] often do more harm than those taking no action,” noted the report.
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