Patagonia Puts Its People Over Profits and Closes Between Christmas and New Year
Patagonia, the outdoor clothing and gear brand, has always marched to its own drummer. From its “Don’t Buy This Jacket” ad in the New York Times, using Black Friday sales not to line its pockets but to give back to environmental causes, and its self-imposed “Earth tax” which donates 1% of all sales to environmental nonprofits, Patagonia’s mission is to make the world a better place for all living in it.
In keeping with its commitment “not to be bound by convention,” Patagonia just announced it was closing all stores, offices and warehouses in the U.S. and Canada from December 25 through January 2 “because our people need a break,” the company said in a statement.
While its website will still be open, it warned shipments will be delayed till after the holiday week. It doesn’t say so, but we can assume all employees will get paid time off since it is taking this action to “look out for people.”
Because Patagonia is a private company, there’s no way to know how many dollars it is giving up by being closed but the typical sporting goods store generated about 60% more sales in a December week last year than during a typical week the other 11 months. For clothing stores, it was even higher, 85% more.
Taking care of business is taking care of people
Needless to say, Patagonia is putting its money where its mouth is. It’s more than commendable. It is truly remarkable. While every other retail brand cares about its customers, more or less, Patagonia cares about people, including its own people.
It’s a variation on the “waiter rule,” whereby a person’s character can be judged by how they treat servers in restaurants. The same applies to companies.
A good company treats its employees well, not just as impersonal automatons to use for profit. Retail employees so respectfully rewarded will give back to their employers and their customers.
It’s one of the fixes retailers can make to their current employment gap. In November, retail employment was 176,000 lower than pre-pandemic February 2020.
Patagonia doesn’t just talk the talk about doing good for people and the planet; it walks the walk. Sadly, that’s a rarity in business today.
“Brands are struggling to create meaningful, authentic connections with consumers because they themselves are not authentic,” says Dr. Martina Olbert, founder of Meaning.Global and a leading authority on brand meaning. “Patagonia is different. It doesn’t strive to connect with people authentically. It just is authentic. Its authenticity stems from its integrity.”
Retailers’ brand purpose statements are all well and good, but few actually live up to them. Brands are, in and of themselves, manufactured constructs.
“Brands have bombarded consumers with marketing messages that exploit our human aspirations and deepest desires to benefit their own revenue stream. But that value is illusory,” Dr. Olbert reflects. “The real power for brands can be found in empowering customers to live their own authentic lives.”
What makes Patagonia different is its products are manufactured to such high quality that ultimately you need to buy less because you get more out of the stuff you already own. The purpose of its products – to help people enjoy nature – are made in such a way that it preserves nature.
It offers an “Ironclad guarantee” to make good on any product that doesn’t fill the bill or if it is damaged through normal wear-and-tear, repairs will be made at a modest charge. It also offers customers a trade-in option for used goods for credit toward a new purchase.
And after it repairs and refurbishes used gear, Patagonia sells recycled products through its Worn Wear hub. “Because the best thing we can do for the planet is cut down on consumption and get more use out of stuff we already own,” the company states.
It produces its products in the most environmentally and socially responsible way, including nearly 90% of its products are made from recycled materials and 100% of its U.S. electricity comes from renewable resources.
Making a difference
Patagonia is doing more than just mouthing words and quoting statistics. It is making a real difference. It was just honored with the Award for Corporate Excellence (ACE) for Climate Innovation from the U.S. Department of State for work it has done in Argentina.
In accepting the award Alex Perry, Patagonia’s director of Latin America said, “We have rejected old ways of thinking and learned how to build a successful business that contributes to the future in a positive way. We’re humbled by this global recognition and we will continue working toward Patagonia’s reason for being, which is to save our home planet.”
A new humanistic brand concept
Rejecting old ways of thinking about brands’ relationship with consumers, as Patagonia has, is the challenge that Dr. Olbert is putting forward to all consumer-facing companies in her new study on the future of commerce, entitled ”Reimagining Consumerism As A Force For Good.”
Her thesis is that the implicit social contract between brands and their customers is undergoing a paradigm shift. “The consumer model as we know it is hitting its limits today as it is no longer socially and culturally aligned with what people value,” she writes.
She identifies a growing cultural awareness that all this spending and getting propagated by brands “to seduce them to fulfill their desires of material comfort and greater well-being” is leaving people unfulfilled, “trapped in a constant mode of becoming but never really getting there.”
“There is a meaning gap in consumerism – a missing context of people’s lives, its effect on people and how it makes us feel,” she continues. “It goes against our own best interest, which makes the consumption model we still use today unsustainable and unfit for the future we are heading toward as humanity.”
Based on Dr. Olbert’s analysis, the traditional aspirational model used to drive more consumption – “the fear of being ‘less than without something’”– must evolve to a conscious and conscientious consumption model.
The new consumer model she envisions is one where the value exchange between brands and people is measured in more than a commercial transaction. The brand must help consumers more fully realize their own human potential.
“For this, consumption needs to switch from the outcome [i.e. buy this product] to a vehicle toward an outcome,” she writes.
Patagonia does this by delivering products that enable customers to pursue an active, outdoor lifestyle thus becoming more fit, healthy, happy and fulfilled.
Expanded definition of sustainability
Brands have to respond to the cultural and social context of our times in more than words but in deeds. For example, many brands talk about sustainability in a narrow context, using it as a badge of honor rather than what is to be expected for doing business in the twenty-first century.
“Sustainability is not only a more responsible production cycle and ethically sourced materials.” She calls these a mere “hygienic factor.”
Dr. Olbert points out that sustainability is the opposite of exploitation, “whether it’s people, natural resources, the environment, ideas, profits or rewards.” She continues, “This [exploitation] was the operating principle we inherited in business as a legacy mindset from the twentieth century.”
Therefore, sustainability is “business done with consciousness and moral conscience. A sustainable business is a humanized business.” It’s about doing what is right morally and in the best interest of all brand stakeholders – consumers, employees, business partners – not just stockholders and senior executives.
Ultimately sustainability is about making the world a better place and Patagonia lives and breathes it from its 1% self-imposed “Earth tax” to its 360 degree approach to recycling, repurposing and reselling its goods.
And shutting its doors for this coming week so its employees can fully enjoy the holiday season is unparalleled in the world of retail where profits are measured by every minute their doors are open.
We can’t go back
The evolved humanistic consumerism model that Dr. Olbert sees taking shape is still in its early stages, but it is advancing more rapidly due to the profound changes brought on by the pandemic in people’s value system.
Patagonia is way ahead of most brands in this humanistic consumerism model because it was built into its DNA from the beginning in 1973 by founder Yves Chouinard. Other brands, however, need to realize the consumer shift that is happening now and begin taking iterative steps toward realizing it in their own businesses.
“If we keep applying outdated ideas to new situations, we will only recreate the past. But we are not going back,” Dr. Olbert warns. “We are going forward. As such, we need to look ahead and anticipate change.”
The old model of aspirational consumerism – I am less if I don’t have this brand – is giving way to a new humanistic consumerism model – I want this brand to become more of who I really am.
The aspirational consumer model is about buying ready-made meanings imparted by the brand. The humanistic consumer model is to help people create new meaning by themselves. Patagonia does just that.
“The consumer narrative is shifting from brand aspiration to human well-being,” she concludes. “As we enter the new era of conscious consumption, we need to create conscious commerce to satisfy our rapidly evolving human needs, values, preferences and lifestyles.”