The sharing trend that became popular with Zipcar is likely to expand to other industries such as tools and baby gear as consumers readjust their spending patterns to focus less on conspicuous consumption and more on making thoughtful choices with their money, says one leading social forecaster.

In the improving but not yet booming economy of 2013, Patricia Aburdene, author of the New York Times bestseller "Megatrends 2000" and most recently "Conscious Money" (Atria Publishing; $16 paperback), predicts priorities and values will play a bigger role in shaping spending decisions.

"Key concepts like practical, quality, meaningful, simplicity, chemical-free, local and sustainable will be what encourages consumers to open their wallets," said Ms. Aburdene, who lives in Boulder, Colo.

For the most part, people are still feeling some financial stress brought on by the Great Recession that started in December 2007, which she says is fueling the popularity of sharing trends such as Zipcar, which allows members of its sharing network to reserve cars for personal use by the hour or the day.

The car-sharing niche created by Zipcar in January 2000 is already starting to see more competitors. Hertz, Enterprise and UHaul have come up with their own versions of short-term car rentals. Regional competitors such as City CarShare in San Francisco, Mint in New York and Boston; and I-GO in Chicago also are becoming bigger players.

"Car sharing is taking off because people are realizing how darn much it costs to own a car," Ms. Aburdene said, adding that car sharing is more of an urban phenomenon.

Other new societal demands and behavior that she expects will gain more traction are transparency, fair trade and third-party verification of products.

Just as the "Good Housekeeping Seal of Approval" helped consumers in past decades put their trust in a product, Ms. Aburdene says more shoppers will be drawn to seals of approval from groups like Greenpeace and the Rain Forest Alliance. "Those product seals will let consumers know the company is socially responsible and the consumer is making a difference in the world when they buy the product," she said.

Fair trade is another growing global movement that will affect spending, according to Ms. Aburdene. Fair trade products -- ranging from coffee to chocolate to wine -- sometimes cost more so that farmers are paid fairly for their efforts.

Gerald Celente, publisher of The Trends Journal in Kingston, N.Y., said he agrees with Ms. Aburdene's analysis of 2013 trends in general. But he says the majority of Americans are on a downward economic path and may not have the luxury of making socially conscious spending choices, especially when there are cheaper alternatives.

"While they can have the best intentions, it's a stomach issue and a pocketbook issue. People are falling out of the middle class in huge numbers," said Mr. Celente, who forecast the popularity of gourmet coffee years before Starbucks became a household name and bottled water decades before Coke and Pepsi got into the business.

Mr. Celente, author of "Trend Tracking" and "Trends 2000" (Warner Books), said Ms. Aburdene's trend predictions for the new year refer mainly to a small segment of people in an affluent society, but do not apply to the masses of Americans struggling to make ends meet.

However, Ms. Aburdene has a pretty good track record of past predictions.

In "Megatrends 2000," which was published in 1990, when many economists warned of tough economic times ahead, she and co-author John Naisbitt instead predicted a booming global economy during the 1990s. The book also predicted the Pacific Rim would come to prominence in the 1990s, and it certainly did, with China and the economies of the Four Tigers (Hong Kong, South Korea, Singapore and Taiwan) expanding at explosive rates.

"When you look at the trends for 2013, the social trends have a very strong economic flavor to them," Ms. Aburdene said. "The way consumers can begin being conscious about money is to start by reflecting on their values and priorities so they spend money in ways that feel right to them."

First Published February 26, 2013 1:15 am by Tim Grant: tgrant@post-gazette.com

What is genuine prosperity? Whether you are an individual devoted to growing Conscious Money, a LOHAS company committed to delivering value to your customers, or an architect of economic policy, it serves you well to contemplate that question. When you do, you may find yourself wanting to distinguish true prosperity from the mundane variety that may dazzle at first, only to unravel because it is highly unsustainable. Many are tempted to define prosperity in strict economic terms. Metrics are handy and besides, we’re talking about financial matters, aren’t we? 

Whether you are a LOHAS company or a LOHAS shopper, you need to understand the megatrend of Conscious Capitalism—because it represents the larger economic context in which the critical trend of sustainability continues to unfold. If you are a values-driven consumer, you should learn how to identify a Conscious Capitalist company. Why? These are the firms you’ll most likely choose to patronize since they tend to espouse the same values that you do. As a company, you may want to measure your own standards against those of Conscious Capitalism. In this article, I describe what I call the three “Trademarks” of Conscious Capitalism.

The Stakeholder Model Conscious Capitalists embrace a philosophy of free enterprise that honors all the parties who contribute to the success of the enterprise. So, when leaders formulate corporate policies, they consider the interests of all “stakeholders”—employees, customers, suppliers, investors, communities, and ultimately the environment and the planet at large. By contrast, shareholder (or traditional) capitalists typically place the interests of investors over and above those of other stakeholders.

This is a critical distinction. But how does it play in business? Suppose a company’s sales and profits fall. That will probably displease investors. To make investors happy again, the company may decide to cut costs (aiming to increase profits) by laying off employees. Thus, the interests of investors supersede those of employees. That’s the Shareholder Model of capitalism.

Companies that champion the Stakeholder Model might well make another choice. For example, during the Great Recession, The Container Store (TCS) faced dwindling sales, like many other retailers. Yet the company, a prominent Conscious Capitalist, took a different path from that of traditional capitalism. Specifically, TCS adopted a “no lay-off” policy. But how, you might ask, was the company financially able to endure the continued cost of employee salaries at a time when sales and profits were slumping? The answer is balance. The Container Store found a new way to cut costs: it temporarily suspended matching contributions to employee 401K accounts. This policy proved far more acceptable to TCS staff than losing their jobs. And once sales again picked up, 401K matching benefits were back on.

As this example illustrates, the Stakeholder Model of Conscious Capitalism is neither vague, nor ideological. It holds clear operational implications for how a corporation is managed, how people are treated, and how a corporation can choose to generate economic value.

One might be tempted to assume that the Shareholder Model, i.e. putting investors first, delivers greater financial value to investors. In fact, traditional capitalists frequently make that very argument. But as you’ll see from the research cited in this article’s conclusion, Conscious Capitalists often outperform their traditional counterparts—in strictly financial terms.

A Purpose Higher Than Profit Despite their commitment to humanistic principles, Conscious Capitalists very much aim to earn solid profits. But unlike traditional capitalists, they do not consider profit to be the reason for their existence, or purpose. Instead, they choose a purpose that beyond the necessity of earning money, a “higher” purpose such as to “make a difference,” or “contribute to society” or to “sell products that foster good health and sustain the earth’s resources.” So, this Higher Purpose is the second trademark of Conscious Capitalism.

In fact, business always has a purpose beyond making money, specifically to fulfill some sort of unmet need. The heart of any commercial transaction is therefore to generate an exchange that is mutually beneficial. While capitalism celebrates the capacity to earn profit, it is purpose that infuses that profit with the profound mutuality and satisfaction.

A Commitment to Human Values In a world where people and companies alike are tossed about by a variety of intense and conflicting forces, we all need an inner compass to help us make the right choices, those that take us from where we are now to where we want to be in the future. In business as well as personal life, strong values supply the most reliable guidance and direction. The third trademark of Conscious Capitalism is a Commitment to Human Values.

Walk into any shop or store. Almost instantly you can get a very good read on the values practiced there. When values are lacking, you will almost certainly find a poor work environment, one that breeds boredom, gossip, and inattention to customers. On the other hand, when positive values are honored, it’s palpable. You feel and see it in the positive behavior of the staff.

The internet sales giant eBay, for example, is built entirely upon the value of trust. Early on, founder Pierre Omidyar posted this statement on the website: “We believe people are basically good.” Trust became the core of eBay’s policies and eBay technology reinforced that trust, so that considerably less than one percent of eBay transactions result in fraud.

What’s the Bottom Line?

            To the surprise of many, the Trademarks of Conscious Capitalism generate superior financial performance. Raj Sisodia, marketing professor at Bentley College and a co-author of Firms of Endearment with David Wolfe and Jagdish Sheth, studied 28 companies, including Google, Whole Foods, and Honda, whose managements fostered positive relationships with employees, customers, and investors. Over a ten-year period, the stock of these Conscious Capitalists soared 1,025 percent—versus 122 percent for the S&P 500. A second, decade-long study showed that public firms that are “great places to work” outperformed the S&P 500 by a very wide margin.

These studies show that when business possess the values, wisdom, and consciousness to appreciate that employees, customers, suppliers, and not just investors, contribute to the overall success of the enterprise, companies can achieve profound and sustainable success.

Patricia Aburdene is one of the world’s leading social forecasters and an internationally-renown speaker. She co-authored the number one New York Times bestseller Megatrends 2000. Her book Megatrends 2010: The Rise of Conscious Capitalism (EMBED Link for Megatrends 2010: http://www.amazon.com/Megatrends-2010-Rise-Conscious-Capitalism/dp/1571745394/ref=sr_1_2?s=books&ie=UTF8&qid=1353425143&sr=1-2 ), launched a business revolution. Patricia’s new book, Conscious Money: Living, Creating, and Investing with Your Values for A Sustainable New Prosperity, published in 2012, is a finalist is the Green category for the “Books for a Better Life Award.” Read Chapter one of Conscious Money at http://www.beyondword.com/consciousmoney/index.html. Patricia was named one of the “Top 100 Thought Leaders in Business Behavior” and serves as an Ambassador of the Conscious Capitalist Institute. Patricia’s journalism career began at Forbes magazine and she was a public policy follow at Radcliffe College, Cambridge, MA. Her website is patriciaaburdene.com.

Two of today’s greatest megatrends, Conscious Money and Conscious Capitalism, are cut from the same financial cloth. And each of these innovative strategies flies in the face of conventional money thinking—which insists that human values should play no role whatsoever in financial decisions. That view is clearly incorrect. Values powerfully shape our choices (even if we’re unaware of it) and our behavior. Our choices and actions write the story of our lives—and our money lives. I’d go even further: positive values support us make better financial choices. Why? Because values engage the heart in the way that sound financial practices honor the head. When heart and head are in sync, our emotions are steady, our mind is settled, and our direction is clear—all of which enhance our ability to make good economic decisions.

In the “better, but not booming” economy many predict in 2013, shoppers will focus more than ever on what they care about most deeply. So human values will increasingly shape their spending agenda. At the same time, new trends and priorities will inspire consumers to find new ways to take their values shopping. In addition to their abiding commitment to Health and Sustainability, values-driven shoppers will honor values like Transparency, Justice, Peace, and the more practical value of Frugality. Look for these trends to gain traction in 2013:

Non-violence Emerges as Top Value. In 2013 Peace and Non-violence will increasingly shape our financial choices. After the Newtown, CT massacre, a CBS poll found an 18-percent increase in people who favor tougher gun restrictions. This year powerful investors (i.e. the California teachers pension fund) have already sold weapons stocks. There are new consumer calls to boycott sporting goods stores that sell guns. In 2006, Walmart banned gun sales, but reintroduced them in 2011 to boost weak sales. “Boycott Walmart” initiatives now appear on Facebook.

Fair Trade Takes Off. Fair Trade (FT for short) consumers voluntarily pay a little bit more to endorse the value of social justice for farmers and artisans in developing countries. Result: Fair Trade is trending toward $5 billion global market. Fair Trade USA’s “Fair Trade Finder” mobile app helps consumers find FT products.

Third Party Verification Rules. Conscious shoppers favor products bearing a seal or certification from a reputable organization. LOHAS shoppers—80 percent of them—want trusted, independent sources to verify corporate product claims and 40 percent of all shoppers demand a seal or certification, reports a study by the Natural Marketing Institute.

Old-fashioned and Green Cleaning Products Rock. As green cleaners like Method, Seventh Generation, and Green Works gain market share over traditional labels, most mainstream cleaning brands (except Clorox and S C Johnson) still refuse to disclose chemical ingredients, despite pressure from consumers and activists. Meanwhile LOHAS shoppers enthusiastically embrace Grandma’s non-toxic—and ridiculously inexpensive—baking soda and vinegar. Great Recession helped us discover joy of frugality, but it’s unlikely we’ll abandon it as the economy picks up.

If there were a motto for 2013’s consumer spending mood, it might be: “Conspicuous consumption is gone for good; but discerning, values-driven spending never goes out of style.” Key words such as quality, meaning, simplicity, peace, economical, and local aptly describe the value propositions that will encourage shoppers to open their wallet in 2013. Time was, marketers asked, “Who is my consumer?” and defined consumer identity in strict demographic terms. But those who seek to build enduring relationships with LOHAS consumers must instead ask, “What are her values?” then cultivate a strategy for reaching said consumer by authentically embodying her values in all branding messages. 

________________

Patricia Aburdene is one of the world’s leading social forecasters and an internationally-renown speaker. She co-authored the number one New York Times bestseller Megatrends 2000. Her book Megatrends 2010: The Rise of Conscious Capitalism launched a business revolution. Patricia’s new book, Conscious Money: Living, Creating, and Investing with Your Values for A Sustainable New Prosperity, published in 2012, is a finalist is the Green category for the “Books for a Better Life Award.” Read Chapter one of Conscious Money. Patricia was named one of the “Top 100 Thought Leaders in Business Behavior” and serves as an Ambassador of the Conscious Capitalist Institute. Patricia’s journalism career began at Forbes magazine and she was a public policy follow at Radcliffe College, Cambridge, MA. Her website is patriciaaburdene.com.