Lush Ethical Retail Focus (It’s Way Harder Than It Looks)

While every firm should aspire to be ethical, there are many risks inherent in marketing a business as “ethical” — or the various synonyms for ethical that have become common in the last decade or so: green, all natural, fair trade, etc.

But there is no official standard for all-natural or ethical, which means all sorts of firms have been known to slap that on their product whether or not it is a fair or accurate description of their wares. There is a growing base of consumers — particularly among younger shoppers — that is willing to pay a bit more to feel confident that the person who made their object was treated decently and that the production process is not contributing to rapidly destroying the plant. And retailers across the board are trying to tap into that trend, in a variety of ways.

The most committed to ethical practices have, of course, worked hard to get control of their supply chain and production line to make sure they are living up to their high internal standards. Others, perhaps less committed, have more updated their packaging and advertising, but not changed very much else about their products. Consumers like — and will pay premium for — the former; the latter, on the other hand, generally leaves them feeling angry, ripped off and likely to write a very unpleasant review.

Hence the difficulty in marketing oneself as an “ethical firm”; falling short of high internal expectations can do lasting and irreparable brand damage, depending on how severe the miss is. And it is far from easy to live up to that high standard, even if a firm is trying quite sincerely.

But Lush, the Poole, England-based handmade beauty and bath products company, is proudly and affirmatively an ethical firm, even if it claims not to like marketing itself that way.

“Here at Lush,” its website notes, ”we have never liked to call ourselves an Ethical Company. We find the term rather a difficult concept, because it seems to us that it is used to describe companies who try not to damage people or planet with their trade practices — when surely this should not be regarded as ‘ethical’ but as normal business-as-usual.”

High-minded hopes for the future of commerce aside, Lush is very much identified by its high standards. Workers in its global factories in Britain, Germany, Japan, Australia, Brazil, Canada and Croatia are paid a living wage. The firm doesn’t buy ingredients associated with environmental destruction or slave labor.

And clean business has been good business for Lush. The firm, now headed by Simon Constantine (the son of two of Lush’s founders, Mark Constantine and Liz Weir), has seen sales double and profits up 50 percent since 2013. And as shoppers at the nation’s remaining popular malls have may have noted, Lush is growing and gradually becoming a physical retail staple in high-end shopping complexes.

And while Constantine maintains that is good news, it’s also a massive challenge, because at some point calling one’s supply chain 100 percent clean just becomes wholesale impossible.

“From the supply chain point of view, we have struggled to keep up,” Constantine noted. “With the amount of work you need to do to keep on top of things and everything changing so rapidly … I would never be comfortable saying our supply chain is 100 percent clean.”

But to fulfill its mission of making the world a cleaner place — which is a fitting goal for a business that started out making soaps and shampoos before exploding with its signature bath bombs — Constantine maintains that perhaps his firm doesn’t need to be perfect so much as it needs to be always perfecting itself with its ethically high-minded (but high-style) consumer group in mind.

“It seems a lot of the beliefs that Lush has held for a long time have suddenly become much more mainstream and relevant. We’re at the right point to offer products with the ethics people are suddenly looking for,” he said.

Most of the time anyway. A little over year ago, Lush found itself embroiled in something of a controversy on its home turf when it took on the institution of fox hunting in the U.K. as something it considered barbaric and obviously needing to be outlawed.

Constantine noted in interviews that, by and large, its customers agreed, but the reality of operating hundreds of stores all of over the world is one creates public spaces for those who disagree to fully express their dissatisfaction with your company’s beliefs.

“We tend to be a bit of bold and stupid in Britain, and that has stirred the pot sometimes, certainly around fox hunting with people … coming into stores and knocking things off shelves and threatening staff,” Constantine said. “Sometimes, we’ve veered away from particularly controversial campaigns … where it may end up with people being arrested or put in jail. It is also about staff safety.”

But Lush is mostly content to use its platform for change — such as it is — to push where it thinks it can do good — raising money for refugees in Syria and protecting chimp habitats by laying off the palm oil in its products.

Consumers can, of course, buy bath bombs from any number of places. A quick search on Amazon offers options to buy 10 “Lush-like” bath bombs for about $22, and some further search can net you 50 for $27. A single bath bomb at Lush tends to run $6.50–$8.00.

But consumers are buying them in ever greater numbers in an ever-increasing number of stores over the 20 years that Lush has been operating — particularly over the last five or so when it’s been expanding globally quickly. Lush may not have 100 percent clean control of its supply chain, but it has loyal customers convinced it’s as clean as it can be.

The lesson from Lush is that being ethical can be a great way to build a fanatically loyal and willing-to-shell-out customer base. But it only makes sense to do it if a firm wants to take it as seriously as Lush, because it’s much easier to do wrong than it is to do right — and doing it right is a constant and evolving effort.


New PYMNTS Report: Preventing Financial Crimes Playbook – July 2020 

Call it the great tug-of-war. Fraudsters are teaming up to form elaborate rings that work in sync to launch account takeovers. Chris Tremont, EVP at Radius Bank, tells PYMNTS that financial institutions (FIs) can beat such highly organized fraudsters at their own game. In the July 2020 Preventing Financial Crimes Playbook, Tremont lays out how.

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