Increase NPS Scores through Social Impact

Discover why consumer expectations are more nuance than brands realize from Brian Sugar, the Founding Partner of Sugar Capital.
Brian Sugar

Brian Sugar is the Founding Partner of Sugar Capital, the VC firm that funds and advises companies ranging from Afterpay and Everlane to Brightland and Feastables. He's also the Co-Founder and Chairperson of Novel and the Co-Founder of POPSUGAR.

We sat down with Brian to learn from his 25+ years of influencing category-defining eCommerce names. Our conversation covers topics including:

  • The evolution of social impact in eComm since the late '90s
  • Three key motivators behind his investment in ShoppingGives
  • Why consumer expectations are more nuance than brands realize

"I had a front seat to the eComm giants of Web 1.0, then Web 2.0, and now web3. Corporate social impact and buyer demands for impact have grown immensely."

The Evolution of Impact & Commerce

Looking at his career in a nutshell, Brian can trace almost three decades of the eComm space:

  1. Web 1.0 -- As VP of eComm for J.Crew in the late '90s, he witnessed and orchestrated the transition of mail-order businesses into digital companies.
  2. Web 2.0 -- This brought the early DTC wave of Everlane, Casper, Warby Parker, etc., AKA brands working to both lower CACs and save the environment by not relying on catalogs.
  3. web3 -- As the co-founder of Novel, he's admittedly 'bullish' on web3 and anticipates its intersections with the next phase of eComm buyer engagement via social impact.

Overall, he's observed the consumer pool shift from the early days of pure amazement at the possibility of digital commerce to demanding accountability from it.

"Gen X" Commerce & Going Digital

Brian summarizes Web 1.0 and J.Crew in the '90s with a few words: "We killed a lot of trees."

Before getting on board with the dot-com boom, beloved brands sent out millions of catalogs to hundreds of thousands of customer addresses each year.

In retrospect, what he finds most interesting is how industry leaders never stopped to question the impact of their operations on the state of the planet.

The DTC Era: Stand Out By Doing Good

In sudden contrast, the busy DTC eCom market of the early 2010s meant brands scrambling to stand out. For Everlane, they landed on one distinct, memorable trait: sustainability.

As a day-one investor in the company, Brian points out just how remarkable it was for the fundamental identity of an apparel brand to not be rooted in churning out good clothes.

They essentially set an era of "radical transparency" in motion, with countless companies hoping to also leverage social impact to keep users coming back and set DTC players apart from legacy omnichannel competitors.

"Previous generations shopped for branding and product quality. Today's buyers look beyond that for one more factor: impact on the earth, fellow humans, etc."

The Next Phase of Impact-Driven Buying

Younger generations of consumers -- particularly those who've grown up in the digital age of easily accessible information -- are the most likely to partake in impact-driven buying.

At the same time, Brian reminds us humans are, by nature, incapable of acting idealistically at all times. For instance, one only needs to turn to two examples:

  1. The era of panic buying at the onset of COVID-19
  2. The continued success of the guiltiest fast fashion companies

One industry being revamped for a greener future is home cleaning products, i.e., entire brands based on all-natural, non-toxic, plastic-free, and/or refillable product lines. Reports even project the global market for green household cleaners to surpass $20B by the end of the decade.

Simultaneously, when spring 2020 saw grocery shelves being ravaged for cleaning products, greener brands with potentially lower efficacy rates were the last to go -- if purchased at all.

At that point, Brian explains, the broader public still had little idea of how COVID spread, so every item from the outside world had to be efficiently scrubbed down for fear of infection.

For better or worse, the early months of the pandemic demonstrated that, in the face of sickness and death, people preserve their own lives before any value system.

Dual Realities: Fast Fashion Prevails

Despite the ever-growing popularity of eco-friendly apparel, some fast-fashion retailers (think SHEIN, ROMWE, or AliExpress) are literally valued at dozens of billions of dollars.

As Brian puts it, slow fashion plus viral images of dumping grounds full of unpurchased clothing can only do so much to combat the momentum of cheap, quick outfits.

In driving forward a social impact agenda, brands must operate based on both realities:

  • Today's buyers place immense value on ethical, sustainable products
  • Elements like affordability and fulfillment speed can compete with those values

"Today's users are pretty idealistic. But when it comes to protecting yourself from COVID or shopping fast fashion to save money, they might sacrifice values."

Brian's Perspective: The Efficacy of ShoppingGives

During his first-ever demo of the ShoppingGives platform, Brian was shocked to be able to find his childhood soccer team in Parsippany-Troy Hills, New Jersey, as a recipient option.

He donated $100 and was moved by the simplicity of the process that enabled him to give back to such a nostalgic, substantial organization in his upbringing.

Since then, he's found other reasons to be a proud ShoppingGives investor through and through.

Alignment of Values

Much like buyers crave a sense of shared values between themselves and their favorite brands, the Sugar Capital team strives to invest in the making of a genuinely greater good for humanity.

So they seek out the same dedication in their portfolio brands. ShoppingGives easily fit that bill.

Even more, Brian admits to a sense of jadedness that comes with decades in eComm. Every giving campaign or green initiative can feel like a simple PR move or cash grab.

Yet, upon meeting the ShoppingGives team, he discovered a pocket of the industry where people wholeheartedly believe every human has the instinct to give back.

Pure Metric Growth

On top of the ethical case for employing ShoppingGives, Brian can't deny the pure metric impacts of the platform. Client growth has been documented across:

  • Conversion rates — Brian estimates the average increase in conversions to hover in the double digits, in addition to strong results in A/B testing of checkout flows.
  • LTV — While it’s too soon in ShoppingGives’ lifespan to run retention numbers, buyers are more likely to show extended, public support of a brand they deem socially impactful.
  • NPS — Even as a "softer metric," execs can't deny the value of positive word of mouth among one's user base, often citing it in earnings calls or conference talks.

"If I'm a buyer, I think the brand using ShoppingGives makes the most important impact because I'm selecting the cause. It's an extremely effective approach."

The Outcome: Driving Growth with Zero Lift

Ultimately, Brian is a ShoppingGives proponent because, as he puts it, it's just the right thing to do -- and with little-to-no lift required.

Looking back at the start of DTC impact efforts circa 2010, brands like Everlane had to manually execute every campaign or program because no streamlined software equivalent existed.

Today, running an impact initiative is integrated into one tech product, ShoppingGives, including:

  • Charging and collecting user donations
  • Paying out amounts to the respective recipients
  • Carrying out compliant government and tax reporting

Social impact has historically been difficult for brands to strategize and execute on their own, says Brian, often resulting in short-lived, half-hearted, or otherwise less successful attempts.

With ShoppingGives, all you do is install, configure some copy, and let customer donations become a low-maintenance, high-impact feature of your company.

"If you say no to ShoppingGives, I do believe there's probably some sort of evil bone in you, because it is so unbelievably easy to do good this way."

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