Quantifying the value of leadership for NRS.
NRS converted to full employee ownership and rebuilt its supply chain, then said very little about either. The question was whether saying it out loud would move revenue, or just feel good.
Preference rose by at least this much once NRS was identified as an environmental and social leader.
Customer Science™ · 23,000 customers, revealed choice · conservative end of a double-digit lift
Belief is not a business case.
NRS had spent years on the substance. Full employee ownership. A supply chain rebuilt rather than audited. The company competed on product performance and left the rest largely unsaid.
The internal theory was that customers cared. The question was how much, measured against everything else a buyer weighs, and whether it would survive a price increase.
That is a harder question than it sounds. Ask people directly and they will tell you they care, because that is what people say. The answer only counts if it comes from what they actually choose.
Surveys ask what someone would do. Purchases record what they did. The gap between the two is where most sustainability research quietly dies, which is why this study measured choices instead of opinions.
Measure choices. Not opinions.
Customers were put in front of real trade-offs and their choices recorded. The design isolated three things in sequence, so each effect could be read on its own rather than inferred from the total.
Leadership was part of the product.
For these customers, where the company stood was not background information. It was one of the things they were buying.
A price increase normally costs you preference. What the experiments showed is that leadership changes what it costs. The same 10 percent rise took less preference away from a company customers understood, and with the attributes attached preference did not merely recover, it finished above where it started.
Two claims sit here and they are not equally strong. That a leader ends up ahead on both price and preference is achievable, and NRS achieved it. That leadership shrinks the penalty a price increase carries is the reliable one. Lead with the reliable one.
Identifying the manufacturer as a leader lifted preference by double digits. Identifying it as a laggard pushed preference down. The effect ran in both directions, which is the strongest evidence that it was real.
The two effects compound. A laggard raising its price loses more preference than the price increase alone would explain. The same mechanism that cushions a leader exposes a laggard, and most companies are only ever shown the first half of that.
The Demand Realization™ Model then translated the preference gain into revenue. Expected growth from the shift ran well ahead of the general apparel market rate.
We have always believed in the importance of doing business the right way, but it was still powerful to see that benefit quantified in sales and dollar terms.
Mark Deming, NRS
They were already paying for it. Now it pays back.
For NRS, customer awareness of what the company actually does is a direct path to revenue, and one that would otherwise cost a great deal in marketing spend to buy. The work was already done. What was missing was the number that made it worth talking about.
From submerged value to banked value.
Let us talk about the value you create, and how you can demonstrate it. Credibly and concretely.
- Preference figures are from choice-based experiments with 23,000 NRS customers, measuring revealed preference rather than stated intent.
- The double-digit preference lift and the 10 percent price increase are the published figures. The price finding is stated as a reduced penalty rather than a willingness to pay more, which is what the experiments measured. A leader can finish ahead on price and preference together, as NRS did; the reduced penalty is the part that holds generally, and it inverts for a laggard. Revenue effects were modeled from the preference gain using the Demand Realization™ Model.