Nearly all major fashion brands in the first half of the 20th Century utilized children to make their products domestically in North America and Europe. When labor movements forced changes to legal codes in these countries, the companies shifted production to countries in Asia where there were no child labor laws, and this practice continued.
It wasn’t until the late 1990s that fashion companies began eliminating child labor in their factories altogether. In a move that shocked the world in 1998, Nike came out in front of their competitors, and vowed to end child labor globally on their production lines. In doing so, Nike not only ended a horrendous practice, but also gained notoriety for leading the charge to root out child labor in apparel manufacturing.
The 21st Century’s parallel can be seen in making business more sustainable and eco-friendly. In the same way that 20th Century consumers began to change their spending habits based on the social welfare policies of companies and manufacturers, 21st Century consumers are heavily focused on the sustainability of their purchases.
In 2014, Nielsen conducted a study to determine if consumers would change their spending habits based on the sustainability of a brand. What they found was that 55 percent of consumers would pay more for their product if they knew that the company was employing sustainable practices.
“Sustainable practices” does not have to mean that the manufacturing of a product is end-to-end, 100-percent “green.” It means that the company is taking measured steps to ensure their business practices meet the “Triple Bottom Line” – that their practices account for increasing profits, ensuring social mobility for its workers, and employing practices to combat deforestation, pollution, and climate change.
For the blockchain industry, sustainability might seem like an irrelevant part of business. Everything is digital, and no blockchain company is creating plastics or cutting down forests. However, consumers are catching up to the reality that the blockchain is in fact a very “dirty” industry. The computing power required to run mining operations, and power servers, is overwhelmingly powered by fossil fuel energy sources.
What the 2014 Nielsen study found was that brands and companies that changed the labeling of their products to include information about sustainable practices saw an increase in sales twice that of companies which made no changes. Additionally, companies that simply launched sustainability-focused marketing campaigns saw a five-percent increase in sales year-over-year.
Modern consumers are changing their consuming behaviors towards minimizing their environmental footprint. As more and more consumers join the blockchain and begin using this technology, they will inevitably begin to seek out companies which are employing sustainable practices.
This does not mean that every blockchain company has to buy 100 percent their power from renewable sources. It means that crypto companies need to focus on this aspect of modern consumer behavior. Is your company mindful of its environmental footprint? Does it donate to eco-nonprofits? Does it have a sustainable business strategy?
Blockchain businesses must seek out the easiest, “no-brainer” ways to employ sustainable practices. To succeed in capturing the eco-consumer, consider:
1. Allowing your employees to work remote. This saves emissions from commuting to and from work. Increase the use of teleconferencing rather than flying around the world every week.
2. Donate to environmental non-profits. Consider donating a portion of your tokens or coins to non-profits every time you reach a milestone.
3. Switch to “proof-of-stake.” Reward your users for holding your token/coin, not for whomever can purchase the fastest computer (how the “proof-of-work” consensus algorithm works).
4. Purchase some, if not all, your business’s energy from renewable sources. Being able to claim that even 20 percent of your business is powered by wind energy will attract attention to your business.
5. Partner with environmental organizations. By co-branding, or having an environmental organization, such as the Rainforest Alliance or Sierra Club, their consumers will take interest in your organization.