The results of the study showed that, across every sector (i.e. 10 of the largest consumer-facing sectors in North America), a brand’s actual sustainability record does not correlate with consumers’ perceptions and awareness. This means that, down the road, all of a company’s investments in sustainability may not pay off in terms consumer behavior or even brand equity/corporate reputation, which is directly undermining the ROI of sustainability itself.

This disconnect, or perceptions gap, often results from the brand’s failure to “talk to walk” in a credible and meaningful way. Therefore, Change developed what it calls the 5C’s of sustainability branding – a series of principles to follow when creating sustainability branding strategies:

• Consumer Facing: Looking at what the consumer is looking at.
• Competitive: To compete, brands must innovate.
• Core: Tying sustainability to a brand’s core business
• Conversational: Leveraging two-way conversations, rather than one-way announcements
• Credible: Sequence and objective credibility are key to sustainable brand success.

I would also add a sixth “C”: CONSISTENCY.

Consistency means a brand, a company undertakes sustainability initiatives that match the reality of its business and the image it conveys. This is critical for building trust, and durably affecting consumer’s perceptions and awareness. And ultimately consumer behavior. How?

• First, sustainability has to be more than just an one-off campaign. Sustainability must be incorporated into the brand’s DNA. It must reflect the core values of the brand and contribute to delivering the brand promise over the long-term. This means that a brand cannot change its sustainability focus or ‘cause’ too often, or engage in too many non-related areas. Every brand effort has to be mutually supportive in order to achieve the broader sustainability brand promise.

• Second, consistency is important in the sense that messages must resonate with the brand’s existing voice in the market place. More importantly, sustainability branding must be communicated at every possible customer touchpoint in a consistent way. The 2009 edition of the Edelman Trust Barometer indeed reported that people need to hear a message 3-5 times, from different channels or voices, in order to believe in it.

• Finally, as brand and corporate reputation are increasingly converging, with consumers not only looking at a product’s sustainability impact but also the overall environmental and social performance of the operating companies behind the brands (see the GoodGuide for instance), sustainability branding needs to be aligned with corporate communications.  Such communications efforts have to be mutually reinforcing, not only with consumers, but also with a broader range of stakeholders such as employees, the media, etc.

And you, what do you think? Do you see any seventh ‘C’?

Well, this is also a golden rule for consumer engagement too.

When interviewed by marketers, consumers tend to reply that they want to buy green & eco-friendly. But as we know, the main bias of market research is that ‘intent’ rarely translates into ‘action’. Because a product will save the planet does not mean that consumers will love it.

Successful green marketing practices follow an ‘eco-frugal approach’. The rising prices of energy and the current recession have been an unprecedented opportunity to switch the marketing focus from ’spending green’ to ’saving green’. As John Grant, author of The Green Marketing Manifesto, says: ‘There are very few instances where saving money and saving energy are not compatible, and, in that sense, reducing the impact on the environment is the only silver lining in the recessionary clouds”.

Rather than promoting green credentials as an end in themselves and trying to bolster green brand image as a result, the strategy for brands to effectively and durably engage consumers (while not being suspected of ‘greenwashing’) is to help them make the life-style choices that will make a difference to both their pockets AND the environment, such as using washing power that can be used at low-temperature (30°C) or switching to eco-efficient light bulbs, which in turn help lower electricity bills as well as carbon emissions emitted in the atmosphere.

This is the approached for example used by EDF, France’s main energy company, which developed an online platform to advise customers on how to save energy (and therefore money) by managing and rationalizing energy consumption in their homes (i.e. electric appliances, etc…). The website called “Ma Maison Bleu Ciel” offers a full set of news, forums, blogs, Q&As, personalized support & follow-up, and more to be developed soon.

You may think it is not that groundbreaking (compared with what other companies may have already done in the past). But it is something simple, helpful, efficient and which matches consumer’s key concerns and needs.

This is green marketing 101, isn’t it?

Grail Research

Probably as a result of a ‘sustainability noise overload’, greenwashing-induced skepticism, eco-fatigue … or simply ineffective communications, it appears that the great majority of consumers (in this case 85%) have no idea about what pioneering companies such as Estee Lauder, Hewlett Packard, Unilever, Nestle and Intel  are doing in terms of sustainability and CSR.

Surprising? Not really. While corporate reputation and brand image are converging, the gap between a company’s responsible initiatives and consumers’ perceptions and … ultimately decisions still remains important. And not properly addressed.

While companies have been pressured to practice what they preach, i.e. ‘walking the talk’, it is also critical to be effectively able to ‘talk the walk’ as well:

• By being transparent and authentic: 63% of consumers rely on product labels as their primary sources of information about green companies and their products, only if product labeling does not lead to confusion.

• By leveraging the right communications channels (as well as the right messages), that engage consumers, leverage their experiences and interactions with brands and encourage peer-to-peer evangelism, through word of mouth conversations (both online and offline), which are considered as more trusted sources of information (45%)  than advertising (38%) or company websites (18%).

So in the end, isn’t it more a question of ‘are we allocating marketing & communications budgets properly?‘ What are you thoughts?

I found this report highly informative and well-written, as it defines greenwashing in very simple terms (i.e. 10 signs of greenwash), explains why greenwashing is still growing (i.e. consumer demand for green, general absence of industry-wide standards for communicating environmental messages, etc.), and finally offers a pretty comprehensive greenwashing checklist.

The best of it though is that the report provides greenwash perspectives for each stakeholder, i.e.  customers; regulatory, enforcing, and mediating bodies; NGOs; Media: journalists, bloggers, and media sellers.

In the end, “it all adds up” as shown in the graphic representation below. In determining whether a particular claim is greenwash or not, an individual may consider a wide range of factors, at the crossroads of brand reputation and corporate reputation, thus showing that both are more and more interlinked today:

]]> http://www.sustainabilityconversations.com/2009/09/21/understanding-how-stakeholders-perceptions-of-greenwash-are-formed/feed/ 3 http://www.sustainabilityconversations.com/2009/08/31/seth-godin%e2%80%99s-view-on-charity-brands-and-bottom-line/ http://www.sustainabilityconversations.com/2009/08/31/seth-godin%e2%80%99s-view-on-charity-brands-and-bottom-line/#comments Mon, 31 Aug 2009 02:53:50 +0000 admin http://www.sustainabilityconversations.com/?p=373 Martin Lindstrom, brand consultant and author of “Buyology – Truth and Lies About Why We Buy” interviewed Seth Godin for Advertising Age about the nature of charity for marketing and brand reputation purposes.

Best seller of management and marketing books including “All Marketers Are Liars“, Seth Godin here questions again the nature of charity and its profitability and benefits for brands.

You can chwatch the video here.

Pretty cynical about brands’ move to embrace social and environmental causes, Seth Godin shares with us his take on the topic:

1. Not every brand needs a charity plan
2. Charity has to be integrated in the brand, and make sense overall to be credible
3. Consider whether you want to join the sustainability/climate change-trend, or if you want to use your ad budget otherwise (see BP case)

Some of my thoughts:

• I agree with Seth when stating that not all brands need a ‘charity’ plan – as not all brands can meaningfully and trustfully engage their publics (i.e. consumers, and also employees, etc.) on social or environmental causes. Such involvement into causes should not be opportunistic – your consumers are not dumb and (please remember) they are extremely cynical about any CSR, Sustainability and social cause move.

Any social cause  involvement has to be deeply rooted in the brands’ DNA and overall purpose – it also has to be aligned with the company’s core values and strategic objectives. Your first word here is CREDIBILITY. The now ‘too famous’ BP trip to ‘Beyond Petroleum’ and back again to ‘British Petroleum’.. is (sadly) an example of how brands need to think twice.

• However, I believe we need to be clear with the terms we are using. Can we put ‘charity’ at the same level as Sustainability and CSR? Philanthropy is intrinsically different from cause marketing, social/environmental purpose marketing and sustainability at large (and more at an operational level). Factors at play, potential impacts and results indeed vary a lot among all these topics. And so does the ROI. We cannot put everything in the same basket.

• Furthermore, I do not think that “we will still be cheated and lied to by cynical producers” because consumers are the ones in control today. They see behind the curtains of your brands and, thanks to the transparency and the immediacy enabled by the internet, no company can hide anything from them anymore. Cynical brands can potentially be ‘rewarded’ with no increase in sales and weak corporate and brand reputation.

• In the end, if a company wants a) invest in a cause and b) engage its consumers to enhance its brand, signing a check to a NGO and getting some media coverage about it is clearly not enough. Consumers have moved from viewers to collaborators. Brands need to take advantage of this and engage consumers on issues that matter to them and that provide them with a greater purpose. The key here is to enable your consumers to become ‘change agents’

Some new and (old) rules prevail here:

• Do not consider your campaign as a mere PR (or Advertising) looking good exercise cos’ your consumers might not think you are as handsome as you may think!
• Do not not greenwash and mislead your consumers cos’ you will be breaking the ‘trust’ agreement that links you to your consumers, and also your employees, NGOs, investors, etc.
• Do not switch from one cause to another too often and support too many causes – it may give vertigo to your consumers
• Do not focus on a cause that does not resonate with your target audience, and that does not enable great social change on the ground.
• Partner differently – learn how to give up control with your customers and let them co-create change with your brand
• Converge around a powerful idea, and position yourself as it public advocate and converter.

]]> http://www.sustainabilityconversations.com/2009/08/31/seth-godin%e2%80%99s-view-on-charity-brands-and-bottom-line/feed/ 1 http://www.sustainabilityconversations.com/2009/08/28/question-your-most-rooted-assumption-green-consumers-do-not-exist/ http://www.sustainabilityconversations.com/2009/08/28/question-your-most-rooted-assumption-green-consumers-do-not-exist/#comments Fri, 28 Aug 2009 06:12:18 +0000 admin http://www.sustainabilityconversations.com/?p=384 What?! No kidding. I have already been writing about this here and there but a new, and interesting study, conducted in the US and published this week points out again to pretty important myths of green consumption and green behavior: a good reminder that the “green consumer” does not exist per se, and that communications and/or marketing messages often end up in deaf ears and do not effectively generate the expected ROI (whether in terms of more sales or more eco-friendly behaviors).

The study, called Green Living Pulse, shattered six myths that I share with you below:

1. Myth: Green consumers’ top concern is the environment

When asked to identify their top concern, the economy, by far, is No. 1 (with 59 percent calling it their top concern) and the environment falls far behind (8 percent).

2. Myth: Green consumers’ main motivation when reducing their energy use is to save the planet

When asked the most important reason to reduce energy consumption, 73 percent chose “to reduce my bills/control costs” and only 26 percent chose “to lessen my impact on the environment.”

3. Myth: Green consumers are all-knowledgeable about environmental issues

For example, the survey asked, “From what you have read or heard about CO2 (carbon dioxide), please place a check beside any of the following statements you think are true.” Almost half (49 percent) chose the incorrect answer, “It depletes the ozone layer.”

4. Myth: Green consumers fall into a simple demographic profile

While the study detected some demographic tendencies, it found that green consumers aren’t easily defined by their age, income or ethnicity.

5. Myth: Children play a big part in influencing their parents to be green

Only 20 percent of respondents with children said their kids encouraged them to be greener – promoting recycling and turning off lights, for example.

6. Myth: If people just knew the facts they’d make greener choices

The study showed that knowledge does not always lead to behavior. Individuals who answered all of the science questions correctly did report participating in a significantly higher average number of green activities — such as driving a fuel-efficient car or lowering their thermostat. However, the 25-34 age group consistently answered the questions correctly, yet, on average, their green activity levels were lower than those of older respondents.

No wonder all the environmental awareness raising campaigns conducted for decades seems to have questioning long lasting impacts down the road … so what does all of that mean?

• For too long such stereotypes have remained unquestioned, the “save the planet” messaging has for long been dead, and that also explains a lot why green marketing can often be seen as “bad marketing” because based on false assumptions as explained by Adam Werbach here.

• Acting like a teacher or an old daddy is counter-productive as most of us, and consumers first, have a low capacity for specific information. Most of our everyday decisions are often based on gut feelings, emotions or wish to attain a certain social status or appearance rather than business cases and scientific truth

• Speak in human terms, refer to what matters to your audiences and resonate with their emotions, needs or concerns, don’t enter into some form of conceptual talk

• Don’t forget the average consumer might see more than 3,000 “sell” messages a day, so innovation and creativity are critical for your messages if you want them to cut through the noise

• Also remember that you, as a CSR/Sustainability communications or marketing specialist, are able to appreciate the complexity, dilemmas and detail of CSR, – so please don’t assume this is also the case for your audiences. They will not be as knowledgeable and passionate about the subject as you are . Be simple, right and offer a greater purpose to your audience.

In the end, it is not that green consumers do not exist, but they exist differently that too many may think. This does also apply to citizens as governments are sorely trying to adopt some new environmental policies such as the Carbon Tax in France or the Waxman-Markey bill in the US. As Marc Gunther’s interview of  Ed Maibach from the Center for Climate Change Communication at George Mason University reminds us:

“The economy and energy have more salience and presence than the environment or global warming or the phrase climate change—which is very abstract,” Ed says. “It doesn’t mean much to people and it has no emotional resonance.”

Language matters. So Ed suggests that those who care about the climate change get away from descriptors like “greenhouse gas emissions” or “GHGs” or “CO2” and instead go with “heat-trapping pollutants,” a phrase that White House science adviser John Holdren has used.

According to the survey, consumers in both developed and developing markets ‘buy green’ not only because of  eco-friendly product features but mostly because green credentials relate to corporate reputation and are another proof of companies’ and/or brands’ honesty and trustworthiness (i.e. transparency, accountability).

This shows pretty well that corporate reputation and brand reputation are now inextricably linked. For consumers, it is less about the products and more about the brands. Consumers are questioning existing brand behaviour and asking whether they believe in brands and/or companies’ overall practices (which comes down to corporate DNA, values and strategic priorities).

The advantages of going green are not in increasing sales but rather in reinforcing corporate reptuation, enhancing relationships and/or rebuilding trust with key stakeholders such as employees, etc.

Therefore, I believe the graphic below can be understood as an assessment of the some of the most trusted  corporations as well as the greenest brands in each given market.

And you, what do you think?

Greenwashing, says Adam Werbach, is now on the verge of finally dying off and will be over in few years, for two main reasons:

• Firstly, the death of greenwashing comes with the rise of radical transparency and external community pressure, fueled by the transparency and immediacy of the web: “Transparency is not a choice anymore, either your become transparent or transparency will be done to you,” says Werbach. The GoodGuide (see one of my previous posts here) or one of the several greenwashing indexes (here) are compelling examples that no one can hide or distort information about its products or organization.

• Secondly, greenwashing will disappear because it is simply bad marketing and does not help grow sales. Just because your product will supposedly save the world (because it is green) will not make it popular. Consumers always think: “ok, this product is good for the earth, but what does it do for me?”. There is confusion around eco-labels, and also mounting problems of trust and transparency and consumer fatigue as consumers constantly get exposed to green messages and advertising. For Werbach, only approaches like “this product will help you saving money because it saves energy” or “a product that is easier to use because it has less packaging” can work.

I agree with Werbach’s points, however I also want to highlight that green should not only be seen as a marketing tool. It is also a reputation management tool that help brands and companies get involved on issues that matter to their key stakeholders. A strong value proposition. A higher purpose that people want to engage with, through which they can feel empowered, through which they can make a difference and build a better, greener world. Consumers should not only be seen as ‘wallets’, they are citizens/netizens, they can also be your employees, etc.. . We just need to look at the Obama campaign to understand how leadership and greater purpose helped make a difference.

But then, in order to create trust and enhance reputation / relationships with stakeholders, companies or brands have to go beyond nice green messages, and show their true commitment to green through their corporate values and priorities.

* You can listen to the podcast of this interview via iTunes, or just click here to listen, right-click to download. You can also find part one of TreeHugger’s interview with Adam here, and follow @TreeHugger on Twitter & get their headlines and news with @TH_rss!

Today everybody is indeed trying to understand how domestic consumption is unfolding in China as consumer demand in the West is shrinking and exports in China are suffering due to the world economic crisis.

A lot of these reports point out to the rise of green consumption, across all types of consumers in China. However, do we really understand what this is all about, what the Chinese consumer sees as ‘green’ and why eco-friendly attributes of a product or services would be a decisive purchase criteria?

:: Defining green consumption is not as easy as it seems

When researchers ask consumers whether they would prefer to buy environmentally-friendly products , they invariably answer in the affirmative as it makes them feel more virtuous and gives them a certain ‘good feeling’ . However such stated intents rarely aligns with actual behaviors in reality, for many reasons:

• Chinese consumers are still highly cost-sensitive and the premium put on being green is not as high as in Western markets. Beyond cost and price, brand name and image is also a key purchase criteria as it is often seen as a proof of quality and safety, as well as a ’social status symbol’.

• Chinese consumers are not as concerned about climate change and a deteriorating environment as their Westerners counterparts are as their level of awareness and education on these issues is not as high, even though there has been relatively some progress. At the moment environmental concerns directly affect the purchasing decisions of only a small proportion of Chinese consumers: “the wealthy, the ones living in the main cities, the better educated”

• The information needed to make the environmentally-sound or socially-responsible purchase decision is therefore not always easy to find, or to understand (and therefore to trust).

What is key to understand is the fundamental difference between Chinese and Western views on what green or eco-friendly means. For Chinese consumers, it means ‘honest and trustworthy’, ‘innovative’, ‘modern and developed’, ‘well-organized and well-planned’, ‘high quality product and services’, ’safe & healthy’ which is very different from the Western ‘back to nature’ perceptions (for some more takeaways, please check this study published in 2008 here).

Two key takeaways:

• When fine-tuning green marketing strategies and messages, it is therefore key to associate and link ‘green’ with ‘personal health’ and health-related product safety, rather than a much broader ’save the world’ type of messages. Messages have to be ‘audience-specific’ and talk directly to your consumers’ concerns or needs in a human, simple and compelling way (i.e. it is all about ME, rather than a broader US).

• The way Chinese consumers value ‘green’ goes beyond product attributes to relate directly to a company’s reputation.

Product safety & quality issues remain at the top of Chinese consumers’ concerns (i.e., recent melamine-milk crisis), which created some of sort of ‘presumption of guilt of corporations’. Brands and companies can therefore leverage the green credentials of their products and better communicate with their customers to ease tensions and doubts caused by asymmetry of information.

However, it is important to remember that this is a doulbe-edge sword that can potentially destroy brand and reputation: any ‘greenwashing’ type of accusations can be voiced and channeled not only by activists and NGOs, but also by millions of consumers online.

Well, I have just read the list of the top marketing buzzwords we can expect to hear a lot more of in 2009, as reported here.

The only sustainability-related buzzword is ‘Greenlining’ which comes down to the 83rd position. It is pretty sad, especially when we get to know what this buzzword is all about: the process of going green in the office as a method of improving the working environment!

Is that all? Yes, and no…there is a great number of other (better-ranking) buzzwords that are ‘CSR-relevant’ and that should guide our approach to CSR and Sustainability in 2009:

• No. 1: Value Justification – Does CSR and Sustainability create sufficient value that would justify spending on it? Of course, this has been a very hot topic in 2008 and 2009 as the recession hit and budgets got cut. It has also been the best test for CSR / Sustainability ever:

As Daniel Franklin in The Guardian wrote, “harder economic times may help to sort out CSR. Some pet projects with no obvious benefit for the business will be dropped. But thoughtful companies will keep at it, with a keener understanding that CSR efforts needed to be sharply focused – and require hard work and careful implementation”.

No one has the choice but to demonstrate the ROI of CSR, which implies abandoning superficial apporaches to rather focus on value-added approaches, aligned with business objectives and strategy over the long and medium term. CSR is an investment after all.

• No. 2: Business Objectives – When developing a CSR strategy, it is important to determine the top three business objectives of the company and develop CSR goals that will contribute to the achievement of these business objectives
• No.5: Benchmarking – In recession, companies that can stand above the average and keep up with their strategic CSR approaches will develop a strong leadership and competitive advantage. No wonder then why rounding out the top 5 is benchmarking as companies will be focusing on their competitors to try and measure their own performance.

And others:

• No. 24: Social Networking – No one is indifferent to the role of social media channels for CSR communications and reporting, as well as powerful stakeholder engagement around ‘good causes’ (i.e. consumers)
• No. 59: Corporate DNA – CSR must form an integral part of companies’ core values and mission, corporate culture.
• No. 79: Win-Win – CSR is not a zero-sum game – it is not about winners and losers. When done properly, it is a win-win situation that hits the triple bottom line.

And another one…Recession Proof (No.70) as consumer demand for green products remains strong despite a declining economy.