More and more consumers exercise power through their wallet

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People have been using their wallet to exert an influence for hundreds of years. In the 19th century in the USA, for example, there were those who boycotted products made using slaves. But you can also do the opposite and make conscious purchases of products from companies that reflect your own political, ethical and environmental views.

The popular name for this phenomenon is a buycott. It might involve, for example, supporting organic products or groups that work actively to fight discrimination and poor working conditions. But you can also flip the coin and support non-organic products or groups that are notorious for poor working conditions.

Buycotting on the increase

Since the 1990s it has become easier to use your wallet to exert an influence, as various ecolabels and social labels have started to become more widespread.

"Buycott actions have increased down the years, helped by various labels. Yet buycotting isn't increasing in general in a comparative perspective," says Michele Micheletti, Professor of Political Science at Stockholm University, who has written a number of books and reports about buycotting.

Buycotting is on the increase primarily among younger people between the ages of 18 and 29 – according to the 'Fokus 10' report from the Swedish National Board for Youth Affairs, between 2003 and 2009 buycotting increased by more than ten per cent in this age group in Sweden.

And buycotting is effective.

"We've seen more and more major companies starting to label their products as organic or Fairtrade. That says something about the effectiveness of this kind of strategy. Companies view this as a way of working with social responsibility, and at the same time it's also a sales argument," says Michele Micheletti.

Get a strategy

The increasing buycott trend will be sustained into the future, believes Michele Micheletti.
As the phenomenon becomes more common in future, all companies, whatever their industry, will need to have a strategy for how to operate with this kind of consumer power.
Michele Micheletti believes that companies need to listen to the criticism put forward by various individuals and organisations.

"One smart strategy is to analyse the seriousness of the criticism and see what you can do to resolve the problems. That's my advice to companies, as otherwise things can really go wrong."

Companies should also be transparent, to make it easier for customers to make choices.

"Many consumers want more information. But they don't know where to find it. There are companies that are transparent, but you'll often need to click around a lot to find the information."