A new startup called OpenLabel aims to give Americans all the information they need to shop their consciences in one app. Simply by scanning the UPC code of a product with their phone, customers who use the app can see everything from a manufacturer’s political contributions to an ecological report card to information about working conditions for the company’s employees.
It’s a “radical transparency” model that’s part Yelp, part Wikipedia, for the socially conscious consumer. Individual users are able to submit their own information about a brand, which is then up-voted or down-voted by the community. Advocacy groups like OxFam and the U.S. Product Safety Commission also have accounts, and can give specific products a warning label or stamp of approval. Currently there are 20 million products on OpenLabel, and founder and CEO Scott Kennedy hopes that number will grow to include everything on your shopping list.
“I don’t think it’s totally hammered into people’s heads that we’re funding something every time we spend money,” says Kennedy. “Economics have a huge impact on what gets done in the world. We spend trillions of dollars on products each year, not necessarily knowing if the company aligns with our values.”
The growth of mobile commerce apps for deals and coupons has already made smartphones part of consumers’ regular shopping routine. Kennedy believes that OpenLabel can use that familiar interface to tap into customers’ more altruistic desires. “We all know the things we buy have an effect on the world, but sometimes you really have to stop and think about it,” he says. By intercepting the customer at the point of purchase, OpenLabel allows busy consumers to consciously choose where their dollars go.
According to a 2013 study conducted by brand consultancy group BBMG, 86 percent of consumers worldwide say ingredient transparency is “extremely important or very important” when making decisions. However, only 57 percent of shoppers are so-called “box-turners,” who actually take the time to check ingredients and labels. Kennedy believes more people would be engaged with their products if manufacturer labels incorporated more useful information.
“We’ve come to an age where people have so many questions about where things come from, spanning from animal welfare to politics. There wouldn’t even be room on the box,” says Kennedy. In the future, he believes the digital label will be widespread and our current labeling system will look antiquated. “I think [not having a digital label] will almost be confusing to a new generation of people,” says Kennedy, “Like buying food with no nutrition information.”
OpenLabel’s business model is to ultimately charge brands for access to user data and feedback. For now, the goal is to populate the site with as many reviews as possible and experiment with the way early users interact and contribute. “Right now we’re finding an asymmetry with the crowdsourcing,” says Kennedy. “More people want to find information than come with information to give.”
Crowdsourcing with a conscience might be a new model that needs fine-tuning, but Eric Whan, Director of Sustainability at consultancy firm GlobeScan, believes open source apps like OpenLabel are ultimately going to resonate with consumers.
“Trust in global companies is at an all-time low. Essentially, consumers don’t believe what big companies are saying,” says Whan. “But global polling tells us that transparency is the single biggest driver for trust.”
Today’s consumers don't just want to buy a product without asking any questions, says Whan. They want to interact with a brand and even see their feedback help shape it, especially through the convenience of technology. The emergence of apps like OpenLabel provide an opportunity for consumers to rebuild relationships with brands they truly believe in. In turn, says Whan, “Companies become more beholden than ever to the marketplace. They begin to engage with the growing segment that cares about sustainability and other issues.”
Ultimately, greater transparency pushes both consumers and companies to be better, says Whan. “It’s a transition from the tyranny of ‘or’ to what we call the power of ‘and,’” he says. “You don’t have to sacrifice quality for ethics in consumption. You can have both. When you align that thinking with the power of mobile communications, it’s a powerful proposition.”